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Dems Say State Budget Must Include Full Pension Payment

2-24-14

By Michael Aron
Chief Political Correspondent

Senate Democrats laid down a marker today in advance of the governor’s budget speech tomorrow. They said any attempt to save money by cutting back on the state’s contribution to the pension system is unacceptable.

“So before you look to take pensions away from people and cut pensions — which the average pension is roughly $30,000 for work when they retire — you have to look at finding ways of raising revenues that’s not picking the pockets of pensioners,” said Senate President Steve Sweeney.

Under the 2011 Pension Reform Act, state workers are paying 25 percent more into the system, the retirement age went from 62 to 65 and there are no more cost-of-living increases.

In return, the Christie administration agreed to a seven-year phase-in of a full state contribution into the pension funds.

Now in year four, that amount has grown to $2.4 billion, and the governor hinted in his State of the State address last month it may be time to shift some of that money to other priorities.

“We made a commitment and we made a promise. And that cannot be violated. The workers are paying more for health care, they’re paying more for their pensions and we’re gonna live up to our obligation,” Sweeney said.

The governor’s office said today Sweeney is misinterpreting the governor’s words and is dealing in red herrings.

We asked a Republican member of the Assembly Budget Committee for his opinion.

“Well, I think it’s important that we make the full contribution and I think the governor’s budget tomorrow hopefully will address that situation. I’m sure it will,” said Assemblyman Anthony Bucco Jr.

With revenues in the current budget year running $400 million below projections and $130 million anticipated from internet gaming falling way short, the Democrats say the governor faces difficult decisions.

“You’ve got a $1 billion-plus problem on our hands. So there needs to be a plan tomorrow of how we’re going to fix this,” said Sen. Paul Sarlo.

Sweeney said he won’t pass a budget at all unless the pensions are fully funded.

“The only commitment we had was that we will make our payment. You don’t want to threaten and do that stuff, but when we’re sitting there listening that ‘I want to do all these things but I have to make this pension payment,’ yeah we made a promise and that’s a promise I can’t break,” Sweeney said.

So the first thing we’ll be looking at tomorrow — is the governor fully funding the pensions? The next thing is will he propose a tax cut in light of all this budget pressure? Asked about that today, Sweeney said, “You’ve gotta be kidding me.”