No Bait-and-Switch on Pension Reform
TRENTON – Senate President Stephen M. Sweeney today questioned Governor Christie’s judgment in cavalierly declaring he might defy a law that passed with bipartisan support and that he himself championed and signed. Christie said he was considering not making a minimum payment next year to the state pension system, contrary to law passed in March to put the state on a seven-year path to meeting its full obligation.
“Governor Christie hailed our bipartisan pension reforms as a ‘great day for New Jersey,’ but he’s already trying to laugh away a law he championed and put his signature on,” said Sweeney (D-Gloucester, Cumberland, Salem). “The longer this obligation goes unpaid, the bigger of a drag it will become on every future budget. The Governor can’t simply skip paying his bills at home, and he shouldn’t be doing it at the State House.”
In an interview two weeks ago, state Treasurer Andrew Eristoff told Bloomberg News that the state was prepared to invest $512 million in the pension system, the minimum payment required by the law Christie signed on March 22. That bipartisan law – and a similar proposed state constitutional amendment sponsored by Sweeney and Senate Republican Leader Tom Kean, Jr. – would require the state to make incremental payments into the pension system over the next seven years until the full $3.5 billion obligation is met in 2018.
But two days later, the Governor chided Eristoff at a press conference, saying his treasurer “got a little out front.” Christie further said the state might not live up to the law after all, cavalierly tossing the reform aside by quipping, “laws change all the time.”
“The governor not only is damaging his own credibility but endangering a bipartisan effort designed to save the pension system from bankruptcy,” Sweeney said. “I strongly urge Gov. Christie to recognize the fiscal damage this could cause and agree to support the law that only four months ago he promoted as critical to New Jersey’s future.”
The law overwhelmingly cleared the Legislature by votes of 34-2 in the Senate and 62-5 in the Assembly. It was signed by Christie minutes after its final passage.
Sweeney noted that the state’s $3.5 billion pension obligation makes up one-third of next year’s estimated $10.5 billion structural budget deficit, according to the nonpartisan Office of Legislative Services. Christie has sought to dismiss that estimate as “fake,” despite his reliance throughout last year’s campaign season on an identically calculated OLS fiscal analysis that estimated an $8 billion deficit – an estimate that included nearly $2.5 billion in pension obligations.
“The reforms we pushed this year were about fixing a system that had run aground – bringing it back to solvency and returning its focus to the rank-and-file public employees it was created to support,” Sweeney said. “By turning his back on that simple idea, the Governor is straining the state’s credibility – and his own. And he is endangering New Jersey’s economic well-being.”