Mays Landing – Speaking at a Town Hall meeting at Atlantic County Institute of Technology, Senate President Steve Sweeney today emphasized the need to confront the state’s mounting fiscal problems and warned that New Jersey won’t be able to make critical investments in education, transportation, higher education and social services unless it enacts reforms to address the looming budget crisis fueled by runaway pension and benefit costs.
“The Path to Progress report has provided us with various reforms and recommendations that would make New Jersey’s economy healthy and competitive again while also providing a more efficient government,” said Senator Sweeney (D-Gloucester/Salem/Cumberland). “The taxpayers deserve to have their government operating in an efficient and effective manner, which is achievable by implementing the recommendations developed by the Economic and Fiscal Policy Workgroup.”
The findings of the bipartisan panel were released in the Path to Progress report as a working blueprint to achieve the operational and structural reforms needed to restore financial stability and affordability.
Introductions were made by Philip Guenther, Superintendent of Atlantic County Institute of Technology and the forum was moderated by Marc Pfeiffer, Assistant Director of the Bloustein Local Government Research Center.
The discussion included proposals to address soaring pension and benefit costs, make government and school districts more efficient, assess the efficiency of our tax structure and leverage state assets.
The panel’s recommendations include merging the high-cost School Employees Health Benefits Plan (SEHBP) into the lower-cost State Health Benefits Plan (SHBP) to take advantage of the cost savings negotiated by the Governor and the state’s largest public workers union. Combining the two healthcare plans will save money at the local level and reduce costs for school employees.
The merger would produce hundreds of millions of dollars in savings for local governments, school systems and their employees, with more savings in future years as additional school districts and government entities rejoin the SHBP.
Significant cost savings and educational and service improvements can be achieved through initiatives such as K-12 regionalization, increased use of shared services at both the county and municipal level, and shifting the cost of Extraordinary Special Education from the local to the state level, according to the report.
Senator Sweeney repeated his pledge that the Path to Progress legislative package will not require retirees to pay more for their healthcare coverage.
“This is about cost savings for everyone, including retirees,” said Senator Sweeney. “While they pay less than current employees for their healthcare coverage, we recognize that those who are living on fixed incomes in retirement have to contend with high costs of living.”
According to the state’s health actuary, there are 61,900 current school employees and another 61,000 of their family members signed up for SEHBP coverage – 86 percent of whom are in Direct 10 plans. Their healthcare plans cost $961 million, and their $37,905 Direct 10 family plan is 28 percent more expensive than the SHBP’s new $27,269 Direct PPO family plan. There is no excuse for teachers and taxpayers to pay $10,000 more for SEHBP coverage than the State and its employees pay under SHBP, Senator Sweeney said.