N.J. Democrats' pension funding push moves forward

State lawmakers are one step closer to putting a constitutional amendment mandating contributions to New Jersey's public pension system on the ballot in November.

The state Assembly Judiciary Committee on Monday advanced a resolution that would create a ballot question asking voters whether they want to write regular payments for the state's underfunded pension system into the constitution.

An identical resolution was passed by the Legislature last year and must pass again this year in order to qualify for the fall election, which is expected to see high turnout from the presidential race.

The measure (ACR109) was approved by a 5-2 vote along party lines, with Republicans expressing concerns that the mandatory payments could lead to steep tax increases.

Democrats in the state Legislature have been pushing the amendment since the state Supreme Court ruled last year that a 2011 law locking the state into a regular payment schedule could not be enforced.

The Assembly Judiciary Committee will take up a proposed referendum mandating billions of dollars into the public worker pension system.

After years of not meeting their payment obligation, committee chairman John McKeon (D-Essex) said lawmakers had run out of other options.

"Not only is there a moral obligation, but a legal one," he said before taking testimony, mainly from business leaders opposed to the amendment and public workers' advocates in favor.

Thomas Bracken, president of the New Jersey Chamber of Commerce, told the committee such mandatory payments "are very dangerous" to taxpayers. He said lawmakers were rushing the issue because the largest pension funds for state workers and teachers aren't expected to go broke for another decade.

"We have 10 years before something of magnitude happens," he said. "We have plenty of time to come up with the right solution to this problem."

Wendell Steinhauer, the president of the New Jersey Education Association teachers union, said lawmakers had already delayed too much, calling the issue "a problem two decades in the making."

Without the amendment, the size of the state's payment — or whether the state makes one at all — is at the discretion of the governor and the Legislature. That's part of the reason the state's portion of the pension system is only about 48.6 percent funded.

"Every year for 20 years there's been some excuse, but there's never been a full payment," Steinhauer said. "Not once."

The amendment also would force the state to make the contribution into the retirement fund in installments throughout the year. State Senate President Stephen Sweeney (D-Gloucester) has said waiting until the end of the year costs the state millions of dollars in investment earnings.

Assemblyman Michael Patrick Carroll (R-Morris), who voted against the resolution, said he agreed the state should fulfill its payment obligations, but he opposed the measure because it did not contain a provision guaranteeing the payments would not be funded by tax increases.

The resolution needs to be passed by both houses by a simple majority to land the question on the November ballot.

Original Article

TROY SINGLETON
ASSEMBLYMAN, 7TH DISTRICT
400 NORTH CHURCH STREET, SUITE 260
MOORESTOWN, NJ 08057
 
Tel: 856-234-2790
Fax: 856-234-2957
Email: AsmSingleton@njleg.org