The government in every State with a cap law is likely to point out the spending limit restraints, thus complicating the arbitration process. In a case involving this issue, Policemen's Association v. Town of Irvington (New Jersey), the judge found that the arbitrator has to consider the entity's cap situation before rendering a decision, and although the arbitrator is not automatically bound by its percentage limitations, the decision must be reasonable in view of statutory factors. Cap laws will be particularly troublesome in States where the spending limitation is in States where the spending limitation is determined by growth in the economy or personal income. Each arbitrator will have to learn the mechanics of cap laws: how the cap is calculated, how much has been committed to noncollective bargaining expenditures, and how much remains for collective bargaining costs. Constraints imposed by cap laws, however, are alleviated where the legislature has the power to approve or reject arbitrated or negotiated agreements. Taxpayers' concern over spending also has produced laws limiting or more narrowly defining the arbitrator's role in public collective bargaining. Nine notes are included.