Fund for New Jersey offers roadmap for solving pension crisis

 (Graphic by Alan Tu)

(Graphic by Alan Tu)

A private New Jersey foundation that provides public policy grants said poor fiscal decisions are hampering the state’s ability to pay for basic needs, and it’s recommending immediate changes.

The Fund for New Jersey said the most critical financial problem is funding the public employee pension system. Rutgers University professor and fund trustee Henry Coleman said a balanced approach would include limiting retirees’ health coverage commensurate with private employers.

“Some of the savings that would result from that could be used to help address the unfunded pension liability. It would include reversing the state tax reductions that were approved as part of the Transportation Trust Fund deal.”

The foundation also recommended increasing the sales tax to 8 percent and adjusting the income tax to boost revenue by 10 percent.

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Former N.J. state Treasurer Feather Houstoun is also a Fund for New Jersey trustee. She said revenue increases are needed to generate additional resources to improve the quality of life for residents.

“If you stop the conversation with well we can’t afford any more taxes, then the state will not be a place where people want to live. If the state is place where people value their environment, value their communities, value their schools, they will come to terms with the need to do some of these things.”

Houstoun hopes the report spurs candidates this election year to examine the options for dealing with the state’s financial woes.

“I hope they’re going to say I understand and respect this problem and I intend to work on it and that’s why you should vote for me. We’re not taking sides on who but that should be part of the conversation.”

The group calls the problem immense — and says policy changes will take longer than a single gubernatorial or legislative term in office.

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