Christie creates panel to study pension changes

Gov. Christie said the study commission would make recommendations to him within 60 days of its formation.
Gov. Christie said the study commission would make recommendations to him within 60 days of its formation. (MEL EVANS / Associated Press)
Posted: August 03, 2014

PARSIPPANY, N.J. - Continuing to argue that change is needed to address a brewing state pension crisis, Gov. Christie announced Friday that he is creating a study commission to present recommendations within 30 days.

The Republican governor signed an executive order Friday to establish the commission, whose members, he said, would be named next week.

The commission -- which Christie said would include experts, "not political folks" - will review the history of the state's pension system, changes in other states, and benefits provided in the private sector to help reach its conclusions, the governor said.

The commission's charge will be "to think long-term," Christie said at a news conference outside the Parsippany-Troy Hills municipal building in Morris County. "When it comes to battling costs . . . no idea is off the table."

Democratic leaders immediately dismissed the announcement. Until Christie provides "appropriate funding" to the system, "there will be no further discussion between us on pensions," said Senate President Stephen Sweeney (D., Gloucester).

Christie cut $2.4 billion from the state's planned payments into pension funds over two years, backtracking on a schedule of escalating payments that formed the basis of a landmark pension deal reached with Democrats during his first term.

The governor, who agreed to make the payments in exchange for workers' contributing more toward their pensions, said the cuts were necessary in light of a revenue shortfall.

Democrats passed a budget that filled the gap with an income tax increase on the wealthy and a corporation business tax increase, but Christie vetoed the measures.

His actions spurred a lawsuit from public-sector unions, which lost a battle to force Christie to make the full payment in the fiscal year that ended June 30. They are continuing their court case.

Christie said Friday "no level of available taxation" could account for the rising pension payments, which were scheduled to escalate over several years to $5 billion into a system that had been underfunded for years before his tenure.

The recent cuts by Christie - instead of contributing $3.8 billion to the system in fiscal years 2014 and 2015, he reduced the payments to $1.4 billion - cover the cost of benefits accrued by current workers but do not compensate for years of skipped payments. The cuts have worsened the system's unfunded liability.

The study commission will issue a status report within 30 days of its formation, and recommendations within 60 days, Christie said.

At that point, "I'll decide what, if any, of the recommendations I want to accept," he said.

Christie, who has held town-hall-style events promoting his call for pension changes, had said he would present a plan for the pension system by the end of summer.

On Friday, he said that the issue was "more difficult and complex" than he had expected, and that he decided outside experts were needed.

He fielded questions on several other topics Friday, including a top administration official's testimony in July to the legislative panel probing the lane closures at the George Washington Bridge.

The official, Regina Egea, said she had deleted text messages she sent Christie in December related to testimony given by officials at the Port Authority of New York and New Jersey.

Christie said Friday he had "no recollection of her even sending me a text." He said the lawyers he hired to conduct an internal review "would have had access to everything I had. . . . If I still had it at that time, they would have had access to it."

609-989-8990 @maddiehanna

comments powered by Disqus