Christie's Tool-Kit Reform Package Stalls in Legislature

Posted on May 6, 2011 by Donald Barbati

 

As reported by nj.com, Governor Chris Christie challenged lawmakers last May to pass a series of bills he said would lower property taxes, but a year later, with only some of the reforms enacted, property taxes are up $1 billion. Depending on who’s talking, the impasse on Christie’s reform package, what he calls the “tool kit,” speaks to either the governor’s poor vision and execution, or the Legislature’s lack of urgency and political courage.

Although some big pieces of his reform effort have been enacted, Christie has repeatedly criticized lawmakers in recent weeks for failing to clear the remaining bills. He labels them “do-nothing” legislators who get poor grades for choosing special interests over lower property taxes. Democratic legislative leaders counter Christie by blaming him for both designing a flawed blueprint to lower property taxes, and for being unwilling to compromise on some of the measures that lawmakers have advanced with amendments. Regardless of which side is right, property owners in New Jersey continue to be the losers during the yearlong debate because they are stuck with average annual property tax bills that continue to rise toward $10,000. 

The average property tax bill in New Jersey increased last year by $295 to a record high of $7,576. That increase came during a year that saw Christie and lawmakers pass a state budget that replaced $1,000 property tax rebate checks with a small credit that was not realized until earlier this year. 

Once again, each side is blaming the other for the increase in property tax bills. Christie says the Democrats own the increase because they have not moved all of his legislation. Democrats say Christie’s bills, even if passed, would have had a marginal effect at best in the face of state school aid cuts and the loss of the rebates.

The full article on nj.com shows where things stand right now with the key pieces of Christie’s proposed “tool kit” reforms, to include what has passed, what has stalled, and what they are saying.

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Will New Jersey Public Employees Collect Their Pension Benefits?

Posted on July 25, 2010 by Frank Crivelli

The Asbury Park Press published an article in today's Sunday edition addressing the ability of The State of New Jersey to honor its pension obligations to those public employees that have been paying into the retirement system since the start of their public employment .  The article, entitled "Can New Jersey Keep its Pension Promises?" unfortunately reiterated the same information that we have been hearing for the last several years.......The Pension System is Broke.

The article stated that as of June, 2009, the state's pension system faced unpaid liabilities in the amount of $45.8 billion dollars.  However, this is assuming that the state receives an annual 8.25% return on its pension investments.  At this point in time, everyone is aware that the State hasn't seen 8.25% for several years now.  Furthermore, many studies have demonstrated that the unfunded liability of $45.8 billion is a conservative estimate and the true unfunded liability is more along the lines of $173.9 billion, with unfunded health care costs reaching $55 billion dollars.  Eileen Norcross, a George Mason University researcher has been quoted as stating, "It's mathematically impossible to pay this out.  It's too large."

However, despite the fact that the public employment pension system is in dire straits, Governor Christie, has made the decision to "skip" the state's 2010 $3billion dollar pension payment. In reviewing the administration's decision to forgo the payment, one has to question if the Christie administration has already given up on attempting to save the state pension system and the countless amount of money that has been withheld from public employee's paychecks on a weekly basis since the inception of the system.  I bet many of you who are reading this article would like to skip a few pension payments or take a "pension holiday" the way that the state, county and local governments have over the last sever years. 

A year or two ago, myself and other attorneys representing public employee labor unions filed suit against the State of New Jersey for failing to fund the State Employee Pension Systems.  An argument was made that the state had a constitution mandate or obligation to fund the pension system.  Unfortunately all of the suits were dismissed under the notion that the state had very broad discretion in making decisions on how to appropriate funds concerning fiscal obligations.  However, the court did leave the door open and stated that a suit would be entertained if pension recipients did not receive payment due to the state's inability to pay.  With that being said, one has to ask the question:  "Wont it be to late at that point in time?"

We will continue to follow this issue on this blog.  You, the public employees of the State of New Jersey, and retired public employees of the  state of New Jersey need to take affirmative steps to attempt to revive your retirement system.  If you do not take immediate affirmative steps to protect your retirement income, unfortunately, it appears as if it will be lost due to government irresponsibility and mismanagement. 

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Pension and Health Benefits Reform Introduced by Assembly

Posted on March 1, 2010 by Donald Barbati

On Thursday, February 25, 2010, Assembly Speaker Sheila Oliver and Assembly Republican Leader Alex DeCroce announced bipartisan Assembly legislation to reform public worker pensions and health benefits has been introduced.

They also said additional legislation to target pension and benefit reforms at state authorities and agencies and to close a loophole that allows public employees to collect a full pension while collecting an additional public salary are being finalized and will soon also be introduced.

Oliver and DeCroce sponsored the bills introduced, but additional sponsors will soon be added. The following bills were introduced:

A2461, which would:

  • Limit pension system enrollment to new full-time employees who work at least 35 hours per week for the State or 32 hours for local government and schools;
  • Base pensions for new police and firefighters on the three highest salary years rather than the highest single year;
  • Impose a pensionable salary cap for new employees of the Police and Firemen’s Retirement System and the State Police Retirement System; and
  • Repeal 2003 legislation that allowed a police or firefighter to retire at any age with 25 years of service credit on a special retirement allowance of 70 percent of final compensation.

A2460, which would:

  • Require all public employees to pay at least 1.5 percent of their salary toward health benefits after the expiration of a current contract;
  • Require new state workers to work at least 35 per hours per week to qualify for health benefits; and
  • Require all newly-hired employees to pay at least 1.5 percent of their base pension toward health benefits upon retirement.

A2459, which would:

  • Eliminate the sick leave injury program; and

ACR115, which would:

  • Ask voters during a November election to amend the State Constitution to eventually require the State to pay the full amount of its required pension fund contribution.

This legislation serves as a companion to the legislation that was recently introduced in the State Senate. As such, please continue to check this blog periodically to ascertain updates regarding the same as it has tremendous implications for New Jersey Public Safety Officers.

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