Monday, 20 April 2015

New Jersey Democrats join court battle over Christie’s pension funding cuts

Democratic leaders in the state Legislature joined the court battle over Governor Christie’s funding cuts to the New Jersey pension system on Monday, arguing in a legal brief that public workers have the law on their side as they seek an extra $1.57 billion than Christie authorized this year.

Christie, a Republican, signed a major overhaul of the state pension laws in 2011. Among other provisions, the law gave public workers stronger contracts with rights to full contributions from the state’s yearly budget to their pension funds, which are underfunded by $37 billion.

Three years after signing the law, Christie now argues it is unconstitutional. He has cut $2.4 billion from New Jersey’s legally required pension contributions, paying $1.38 billion instead of $3.8 billion over the last two years in a last-resort effort to balance the budget. The latest cut is under review by the New Jersey Supreme Court, which has scheduled a hearing May 6.

Senate President Stephen Sweeney and Assembly Speaker Vincent Prieto, both Democrats, submitted a five-page brief rebutting the central plank of Christie’s legal strategy. The 2011 pension overhaul is, in fact, constitutional, the lawmakers argue.

“We want to make it clear to the court that the administration’s refusal to make the legally required pension payments violates the law and disregards legislative intent,” Prieto and Sweeney said in a joint release. “The pension reform bill approved by the Legislature and signed by the governor is a law he can’t choose to ignore.”

In their brief, Sweeney and Prieto point out that the same 2011 overhaul increased pension costs for state workers – and that workers have no way of skipping them. They also point out that the Legislature approved a budget last year that fully funded the pension system, making a $2.25 billion payment, by raising taxes on businesses and wealthy earners. Christie vetoed the tax hikes before signing the budget and reduced the pension contribution to $681 million.

 

 

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