It was exactly two months ago that a Superior Court judge issued a ruling that ordered Gov. Chris Christie and lawmakers to work together to find another nearly $1.6 billion for the state pension system before the current fiscal year ends on June 30.
But since that order came down, and as the fiscal year now enters its final weeks, instead of cooperation there has been mostly posturing and finger-pointing between the governor, a Republican, and the leaders of the Democratic-controlled Legislature.
That bitterness was again on full display yesterday as Christie, during a town hall-style event held in Cedar Grove, ripped into Senate President Stephen Sweeney (D-Gloucester) and Assembly Speaker Vince Prieto (D-Hudson) for filing a legal brief earlier this week seeking to join the litigation over the pension payment, which has now reached the state Supreme Court after Christie’s administration appealed the February 23 ruling.
And the lawmakers’ legal filing came on the heels of the New Jersey Education Association’s announcement that it was pulling out of discussions with acommission impaneled by Christie that has been looking at new employee-benefits reforms since last year, dealing another blow to the governor.
“Listen, I’m a politician and I understand politics and I understand politicians have to say certain things at times to satisfy certain constituencies, but man, don’t file a paper in court to do that,” Christie said during the town hall.
“You want to go and have a press conference and stand on the steps of some place and say ‘He should make the payment,’ and blubber on, that’s fine, I understand. But don’t file a paper in court that essentially is leaving the bill to all of you,” Christie told those at the town hall.
Christie and the Democrats were able to work together in 2010 and 2011 to forge a series of pension reforms, including making employees pay more toward their pensions and requiring the state to increase employer contributions over a seven-year term to improve the overall health of the pension system, which covers the retirements of an estimated 773,000 current and retired workers but is grossly underfunded.
The governor has since accused Democrats of blocking further reforms to the pension and health-benefits systems, which he says have grown too costly for taxpayers to afford. He wants to freeze the current pension system, make employees accept cheaper health coverage, and use the savings to pay down the pension system’s debt.
Democrats, meanwhile, have accused Christie of reneging on his deal to increase the state contributions into the pension system after he decided last year to address budget problems by reducing a combined $2.45 billion from the payments pledged under the earlier reform effort. They don’t want to talk about new reforms until the prior deal is honored.
Christie yesterday said if the Democrats were intent on making sure the current $32.8 billion budget included the full $2.25 billion pension contribution that was required under the earlier pension reforms for this fiscal year they should have sent him a budget bill with the bigger payment in it. Instead, he said at the event, they sent him a budget with a much smaller number.
“The Legislature passed it, and I signed it, with that number in it,” he said. “They’re now suing to force the court to force them to do what they didn’t do. They’re essentially suing themselves. It’s extraordinary.”
But Sweeney, reached by NJ Spotlight after the event, said Christie got it completely wrong.
Democrats, he explained, sent Christie a budget bill late last June that included the full $2.25 billion pension payment. It was Christie who reduced the payment down to $681 million using the line-item veto because he didn’t agree with two tax-policy changes, surcharges on corporate taxes and personal income over $1 million, that Democrats passed to generate the revenue needed to fund the bigger payment.
“We did,” Sweeney told NJ Spotlight. “We absolutely did. It fully funded it.”
Christie press secretary Kevin Roberts later yesterday attempted to put the governor’s comments in a different context, saying Democrats could have attempted an override of Christie’s line-item veto of the bigger pension contribution last year and they did not.
“I think the point stands that the Legislature passed a budget which we line-item vetoed and they had the opportunity to overturn that line-item,” Roberts said. “They declined to do so.” But there are not enough Democrats in the Legislature to have a successful veto override, and Republicans have not broken ranks for an override since Christie became governor.
Sweeney said Christie’s bigger problem is that his economic policies — namely tax breaks for businesses and repeated vetoes of legislation that would collect more money from those earning over $1 million – have proven to be a “failed experiment.” They haven’t produced the economic growth that other states have enjoyed in recent years and the revenue that would have made the pension payments more affordable, he said.
“Six years of protecting just one class of people” hasn’t worked, Sweeney said.
He also pointed to a YouTube video from 2011 of Christie speaking at a town hall-style event in Fair Lawn when the governor was still trying to win support for the pension reforms that were eventually passed that year. Christie himself makes the case in the video that the increased state pension payments were being made into a contractual right of the employees – something his administration is now contesting in court.
“That schedule is codified into the legislation we have right now and makes it a contractual right of the folks in the pension system to have those payments made,” Christie said during the 2011 town hall. “We’re further locking ourselves into making those payments along those schedules. So I think what we’re doing now is approaching it in a responsible way and making sure that those payments can be made.”
But Christie said yesterday that the state simply has not collected the money that he thought it would and that it is not going to be able to do so without raising taxes significantly — something he said he’s unwilling to do.
And if his administration loses the court case — the latest arguments are scheduled for May 6 — the state not only needs another $1.57 billion for the current fiscal year, but another big chunk of money for the fiscal year that starts July 1. Christie’s proposed budget calls for a $1.3 billion pension payment, far less than the $3.1 billion contribution required by his pension-reform law.
“My question to them is, where’s the money? Where’s the money? They need come up with $3.3 billion,” he said about the Democrats.
NJ Spotlight, an independent online news service on issues critical to New Jersey, makes its in-depth reporting available to NewsWorks.