Some local governments in New Jersey are failing to comply with a state law that bars independent contractors from earning state pension credits.
Following an investigation examining 58 municipalities and school districts in New Jersey, state Comptroller Matt Boxer says hundreds of part-time town attorneys, engineers and other professionals who work for private firms are improperly participating in the state pension system.
“It has the potential to cost the state millions of dollars a year in improper pension benefits,” Boxer said Tuesday. “It also has implications for state health-care costs because once you get 25 years of pension credits, you’re entitled to lifetime state-funded health care as well.”
He said some local government officials relied on the advice of an attorney whose own pension status was at issue.
“They were going to their town attorney and saying, ‘Are you properly in the pension system?’ And, surprise, the town attorney would say, ‘Yeah, I’m properly in the system,'” Boxer said. “And they would leave it at that instead of getting the impartial unbiased advice that common sense would dictate they should be getting.”
Boxer is recommending 202 people be removed from the pension rolls. He says more than a thousand private contractors statewide could be illegally accruing pension benefits.
He’s recommending a checklist be developed for towns to certify pension eligibility.