BUSINESS & ECONOMY

Christie Focuses Budget Address on Pension System

By Michael Aron
Chief Political Correspondent

It was a rousing welcome but an unusual budget speech.

After some obligatory words about fiscal discipline, it focused almost entirely on the state pension system.

“We don’t need any court to tell us we have a serious problem,” said Gov. Chris Christie.

One day after Judge Mary Jacobson’s bold ruling that Christie and the Legislature need to come up with an additional billion and a half dollars for this year’s pension payment, let alone next year’s, Christie basically brushed it off.

“No one branch of government can wish or order the problem away. We must do it together,” Christie said.

The governor appointed a study commission on pensions six months ago and used this speech to disclose its major recommendation, an agreement with the teachers’ union to manage its own new pension system.

“For the last five months, the commission quietly has worked with the NJEA to find common ground. What have been the results of these investigations? Well I am pleased to announce today that the commission with my support, has reached an unprecedented accord with the NJEA on a road map to reform to solve our long term problems with the pension and health benefit systems. While this road map is with the NJEA, only today, I hope other unions will consider it and follow suit soon,” said Christie.

Specifically, the agreement calls for replacing the current teachers pension system with a brand new one, managed by the union.

“The road map calls for the existing pension plan to be frozen and be replaced by a new plan. Both the existing plan and the new plan would be transferred from state ownership to a trust overseen by the NJEA. But the road map also requires that the state makes periodic contributions each fiscal year to the trust. To pay off the unfunded liability of the existing plan over a period of 40 years. TO ensure that the state meets this obligation, the payment is enforced. A constitutional amendment would be voted on this November,” Christie said.

The proposal seemed to take lawmakers by surprise, but Christie exhorted them to get on board.

“We will tackle this problem now and we will solve it. That is what real leadership produces,” the governor said.

There was no mention of the Transportation Trust Fund, another looming issue.

The Christie administration says it will continue to negotiate on that with the Democratic legislative leaders.

And unlike his State of the State address, the budget speech did not reveal a man with his eye on higher office.

Just a governor whose focus for now seems to have shifted back to the state that produced him.

“I will never ever give up on New Jersey,” he said.