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Saturday, October 31, 2009

Municipalities had no choice but to sue

The Nashua Telegraph says that New Hampshire cities and town were right to take the state to court over cuts in municipal retirement subsidies, whether or not they win the case.
The state took $50 million from cities and towns in the form of suspended state revenue-sharing payments. That, as far as we know, is resented but not being challenged.

It then handed municipalities a bill for $27 million. That’s the estimated cost of reducing the state’s contribution to public employee retirement funds from 35 percent to 30 percent next year and to 25 percent in 2011. The reduction, which is the subject of an impending lawsuit, will cost Concord taxpayers between $300,000 and $350,000 over the next two years.

The municipalities are right to challenge the state’s unilateral abrogation of a longstanding agreement. They may not win, but given what’s at stake, they must fight the state’s move, one that could have been avoided by raising more revenue.

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