This piece is written to highlight the possible unintended consequences of this particular bill.

It is no secret that I have been very outspoken pertaining to the Warwick Fire Department finances and the management of the department’s budget.

For the last ten years I have scrutinized the budget, found numerous disparities within it, and spoken publicly about my findings. I have brought to the attention of the city and the residents that unused sick time, unused vacation time, and medical exam budgets were being used in a manner that was a direct violation of the municipal contract. My findings were documented by a third party CPA firm and ultimately a lawsuit was filed to obtain restitution for the scheme. Unfortunately as of this date the city has not taken any aggressive steps in the suit to recover these “stolen” funds.

In May of 2019 during the budget hearings, Mayor Solomon ended the unused sick time scheme where members of the department manipulated the numbers to be overpaid compensation that was not due to them. At that budget hearing I spoke publicly and predicted that there would be a dramatic increase in overtime due to a revolving sick out scheme that would ensue. In fact, I was correct and sick time increased greatly, and overtime increased dramatically from approximately 1.6 million to now 4.5 million. The official documents clearly showed that younger members of the department that had not reached the level of being paid out for unused sick time took excessive sick days and the members of the department that had previously participated in the scheme were now coming in to cover the sick time at the overtime rate.

I am now making a prediction that overtime in municipal fire departments will increase again based on the following hypotheses. I make these assumptions publicly as a warning to municipalities based on what I have already discovered in Warwick and hundreds of hours of research.

As of my last public records request, the Warwick Fire Department had accumulated 22,845 days of banked unused sick time. In Warwick, members of the department are allowed to accumulate 140 unused sick days that they can cash in upon retirement. At retirement they are paid 75% of the days and that number of days is monetized into one lump sum check. I will assume for this conversation that these monies will most likely incur a 28% tax.

If the new proposed Trump bill on no tax on tips or overtime passes it will allow for more gaming of the system from municipality employees particularly fire departments.

What will take place is as follows:

Instead of taking the end of career cash out on sick days and only being paid a portion of the accumulated time, the members of the department will use them during regular working hours where they call in sick and will be paid 100% of the value of the day and be taxed accordingly. Then, fellow members of the department will cover the sick day at the overtime rate and not be taxed state or federal income tax. If this bill passes it will incentivize departments to increase sick time as the no tax on overtime will greatly increase overall pay to the individual members.

This only makes sense. Why would any member want to keep these sick days in the bank to be paid less upon retirement when they can take them now and collectively the members can cover each other to enhance their annual pay?

The Warwick Fire Department members have taken extraordinary steps in the past to squeeze money from the taxpayers, and the behavior has gone unchecked by the department and by the administration. If not for astute taxpayers calling them out on the behavior, these schemes would still be in full force.

Unfortunately, as great as this bill sounds to the ordinary person there will be unintended consequences for taxpayers footing the bill. I put this forth only as a warning that municipalities need to police the sick time and scrutinize contracts to ensure that no member is actively taking advantage of the taxpayer. In Warwick, the facts indicate that this department will take whatever steps necessary, legitimate or not, to abscond as much money as possible from the taxpayers. If they are not held accountable, which they have not been to date, the behavior will continue. I would encourage municipal leaders to heed my warning and address this issue if this bill should pass congress.

The consequences of ignoring this will ultimately be passed on as yet another burden to the taxpayer.