Democrats prod Christie to make pension payment immediately
Public employee union members fill the plaza and street in front of the Statehouse last month in Trenton, New Jersey. The unions are protesting Gov. Chris Christie's pension funding reductions. Since last year, Christie has reduced how much the state has contributed toward the retirement funds for public workers. The Republican governor has put in more than his predecessors, but less than he agreed to in a pension overhaul in 2011. (Mel Evans/AP photo)
The Democratic leadership in New Jersey’s Legislature has another proposal to boost state payments into the public employees pension system.
Lawmakers are urging Gov. Chris Christie to make the state’s $1.3 billion budgeted pension payment early next month instead of waiting until the end of the fiscal year, June 2016.
Borrowing the money to make that payment now could generate additional investment income, said Senate President Steve Sweeney, estimating a gain of $92 million.
“The carrying cost on a bond anticipation note is $6.5 million,” said Sweeney, D-Gloucester. “The governor says he’s committed to helping fix this pension system. This is one of the ways to do it.”
Senate Republican Leader Tom Kean dismissed the idea as bad fiscal policy.
“To do something like this upfront in July when you don’t know what’s going to happen in January, much less March or next April, is shortsighted in the extreme,” said Kean, R-Union.
But Assembly Speaker Vinnie Prieto said Monday making the payment early would send a “clear message” that the state intends to begin paying down the pension fund liability.
Christie last week vetoed legislation pushed by the Democrats to impose surcharges on the corporate business tax and income above $1 million to fund a larger pension system contribution.
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