NJ Supreme Court Takes On Pension Payment Case

In an order just released the state Supreme Court assumed jurisdiction in the pension payment case and set out a timeline:

  • April 20, 2015: Respondent’s briefs
  • April 24, 2015: State’s reply brief
  • May 6, 2015: Oral arguments

No word on a decision date by the court but Governor Christie’s timeline is not expected to change:

April 15-17, 2015: New Hampshire town hall tour

Around May 20, 2015 (mirroring 2014): Regardless of what the court decides, the announcement that New Jersey can’t make the pension payment.

56 responses to this post.

  1. I’ve read with great interest the State’s motion to void the provisions of Chapter 78, essentially stating a statutory right does not rise to the level of a constitutional right. I must admit, the motion is superb and well though-out. I believe the State has made its case and the pension payment will not have to be made.

    Reply

    • Posted by Anonymous on April 9, 2015 at 11:55 am

      The state’s legal focus is on debt limit language, employee benefits are long-term employer obligations. Bonds have historically been used to finance extraordinary expenses, ie, bridges, major roadways, government facilities, the debt limit appears to be more applicable to short-term projects with the long-term maintenance covered by yearly budget items. Employers offer salaries and benefits per union agreements and state/federal statuates it is continuous and enjoys long-term presedence. By the way Gov. CC says his NJ pension is a 401k not true.

      Reply

      • Posted by Tough Love on April 9, 2015 at 12:31 pm

        While Christie may have an IRA or a 401K Plan as well, I challenge you to SHOW where Christie stated that he does not have a DB pension.

        You are either misinformed. or a well-informed liar.

        Reply

      • Posted by Anonymous on April 9, 2015 at 4:34 pm

        Tough Love you sound off like a side chick, Mr Mulshine of the Star Ledger reported CC shared this info about his NJ pension at a recent town meeting. If it’s incorrect take it to the source.

        Reply

  2. What is the status of the Cola case?

    Reply

  3. Posted by Tough Love on April 6, 2015 at 4:02 pm

    Quoting … “Around May 20, 2015 (mirroring 2014): Regardless of what the court decides, the announcement that New Jersey can’t make the pension payment.”

    That’s exactly what he SHOULD do …… because this “issue” MUST be forced to the table.

    NJ CANNOT afford the current level of (CLEARLY excessive) Public Sector pension/benefit “promises”, and they MUST be VERY materially reduced for the future service of all CURRENT workers.

    Just as the NJ pension Commission proposed.

    Reply

  4. Posted by Anonymous on April 6, 2015 at 8:14 pm

    Christie promised to make the payment. Christie is bold faced liar. Christie never said, he would make the payment if he could afford it. He said it was the law. But when it comes the lawyers and politicians the law can be violated at will.
    message to broken record, your taxes will go up drastically even if pensions are reduced. wake up. Any decision made by the court will be corrupt, no matter which way they decide.

    Reply

    • Posted by Tough Love on April 6, 2015 at 9:45 pm

      Christie is the ONLY Governor (or ANY other NJ politician) FINALLY saying what most of them know … but don’t have the stomach & guts to address ….. that the Unions MUST be told that their promised pensions are unaffordable in the extreme … and MUST be very materially reduced.

      That’s what you have a problem accepting, not that Christie “lied” to you.

      The greed-fest is rapidly coming to an end.

      Reply

    • Being cynical, I don’t think Christie expected the economy to remain in the toilet as long as it has. So, he may have thought he would be able to squeak by long enough to get out of office. However, regardless of his intentions, the fact is that NJ’s economy does remain in the $hitter and is not going to get any better.

      So, it is totally appropriate to fight accelerating NJ’s demise by forcing the Supreme Court to either take ownership or give the gov a free hand to drive a better bargain. Either way, the taxpayers are screwed and should not wait to unload their homes if they still can.

      Reply

    • Posted by Anonymous on April 9, 2015 at 2:06 pm

      Do you consider all of the other Governors and legislators who promised excessively but unable to pay bold face liars too?

      Reply

  5. Posted by Anonymous on April 7, 2015 at 7:08 am

    Convoluted Lies and Broken Record, (her new name) perfect together! She finally admits in writing that she believes the bold faced lies of Chris Christie! Including the one that her taxes arent going up soon! She has plenty of money to pay them since she has been stealing from the private citizens from years and doing so with the support of Chris Christie, she certainly works for one of the companies he has given tremendous breaks to, like Exxon, even richer than exxon, an insurance company. Her gravy train will come to an end very soon as well when the dollar collapsed, She doesnt believe this is going to happen, even though the federal government has an insurmountable debt. She simply cannot afford to believe this.

    I will repeat again what Christie himself said after 2011 pension reforms. “You will thank me for saving your pensions and payment will be made because it will be the law”

    Reply

    • Posted by Tough Love on April 7, 2015 at 9:02 am

      She admits, She has, She believes ,She cannot………….. you’re nuts. This has NOTHING to do with me.

      NJ’s HUGE pension problem isn’t going way w/o VERY material reductions in the promised pension BENEFIT levels.

      Reply

      • Posted by Anonymous on April 7, 2015 at 11:51 am

        I knew you would resort to your second grade name calling. It has do with the fact that your Dad never gave you the love you wanted. when you were a kid. Now you live a life of agony, looking everywhere for the love you never got. The government doesnt approve of you lifestyle and that really grinds your gears.

        Reply

      • Posted by Anonymous on April 7, 2015 at 3:52 pm

        She has been predicting for 5 years, yet another 5 will go by and nothing accomplished

        Reply

  6. Posted by BH on April 7, 2015 at 11:11 am

    Through this whole thing, it still amazes me how everything is on the backs of the public employees. There’s some state worker out there making a modest living, working their job with pride, doing nothing wrong, making their pension payments, union dues, healthcare payments etc.. Planning their future, retirement, kids college..all based on the promise, the contract that was agreed upon 25 years ago. …meanwhile the state failed to keep up their part and instead took the pension money… Gave it to ALL of us in the form of tax savings.. And now YOU want to tell this person… Look- sorry you did your share, kept up your end of the deal.. Your entire working life.. Made plans and financial obligations.. But because we failed you as a state and we the people took from you all those years… Your pension is now GONE!!! But don’t worry.. For keeping up your end of the deal… The rest of us lazy hypocritical finger pointers agree that not only do we not want to participate in saving your future even after we gained from it allll those years, but any solutions will come directly from your own pockets as well while we sneer at you and call you greedy and selfish pigs!!!
    That’s just unbelievable!!! Just like in the private sector where CEOs make hundreds of millions instead of giving back, there are the upper tiers in the public sector. These are the ones we read about and base our positions on. But they are the few not the norm.
    I know you’ll say the following-
    -the pensions were too rich to begin with
    -their unsustainable
    -by screwing every state worker, we are saving the funds!!!!

    All BS!!!

    What we will be doing is turning our backs! Being selfish and greedy ourselves!
    You forget, any significant change to these peoples pensions and healthcare will inevitably ruin the state. Mass exodus, lack luster teachers, cops who could give a dam and barley pass the civil service exam will be patrolling our streets!! Firefighters that have English as a second language running into burning buildings……
    You want to ruin this state…. Destroy the future of hundreds of thousands of state workers!!! And you’ll say, good! Let them leave. Someone will replace them!! Who? You TL?? You- anonymous??? You didn’t years ago because you were either too scared or too latzy, but either way….look in the mirror…. PEOPLE LIKE YOU WILL RUIN THIS STATE…..not save it!!!

    Reply

    • Posted by Anonymous on April 7, 2015 at 11:53 am

      It is a simply equation really, she needs attention, she gets it here. It better than nothing for her.

      Reply

    • Posted by Tough Love on April 7, 2015 at 4:57 pm

      I particularly like the ….”your share” part.

      Do you mean the 10-20% of the total cost of your extremely generous pensions that YOU actually paid for (with the 80-90% balance foisted upon the Taxpayers) ?
      ———————

      And YES, Public Sector pensions ARE too (unjustifiably) rich, and unsustainable.

      Reply

    • Posted by Anonymous on April 9, 2015 at 2:08 pm

      The state is already ruined that is why anyone who can is leaving or has already left

      Reply

  7. Posted by BH on April 7, 2015 at 11:17 am

    And to add… A prediction!
    Courts rule in FAVOR of the unions!! State required to not only make full payment this year, but since the 2011 reforms that Christie runs around claiming such success, he must follow HIS law to the T and make all future payments as well.
    Then, let’s see your coveted taxes sky rocket and see YOU leave the state!!!
    A-Bye Bye, don’t let the door hit ya in da a**!!!!!

    Reply

    • Posted by marbs on April 7, 2015 at 12:47 pm

      BH your post is on point, thank you for taking the time to write out a post that long and factual. I am sure some here will tear it apart by their incessant cutting and pasting. The only problem I see is Christie will throw a tantrum and still refuse to make the payment and to gain more time will petition the US Supreme Court to take the case, By that time he will be gone, either thrown into the heap of has been politicians or hopefully indicted. He will most certainly not be in Washington unless he can convince Menendez to resign and appoints himself for a brief stint in the senate until he is voted out.

      Just a thought if the state does not have the money to put into the STATE plans just borrow it….they borrow for everything else.

      Reply

      • Posted by dentss dunnigan on April 7, 2015 at 5:21 pm

        I don’t think borrowing will cut it with our rating and these would be G O bonds ,nobody would touch them ….

        Reply

        • Posted by marbs on April 7, 2015 at 10:45 pm

          I would have tended to agree with you but the State just borrowed over 600 Million so the Transportation Trust Funds being broke would not have to be dealt with this year.

          Reply

          • Posted by dentss dunnigan on April 8, 2015 at 2:43 pm

            marbs ,the big difference is the TTF has a revenue stream to pay off the interest and principal of those bonds …any pension borrowing is general obligation bonds which payments are backed by nothing .New Jersey already has pension bonds outstanding which Whitman took out at a rate of 8% and still have till 2029 to be paid off at the rate of 750 million every year for the next 15 years …nobody has a clue where to come up with that money

    • If the S Ct imposes its will on the Gov, he will react by reducing state aid and any other discretionary items and the hue and cry will be heard all the way to the Alleghenies.

      Reply

    • Posted by Anonymous on April 12, 2015 at 8:32 am

      Pension & health benefits funding problem is real, plenty to blame, now leadership needs to stop grandstanding and come up with a compromise solution that’s in all concerned’s best interest – now!

      The following proposals, if provisional agreed to by all stakeholders, should satisfy any pending lawsuit(s) pertaining to the currently suspended COLA and could address the recent court ruling on the ARC payment deficiencies. I should add the “double dipping” and the ability for career part-time public employees to receive pensions must stop immediately.

      1. Reimplement the COLA by offering “drop down” menu options which would result in a reduced base allowance based on the option selection and age(s) of the retiree and beneficiary, if applicable. For current retirees, the age(s) used would be the statute effective date. Possibly consider requiring retirees currently receiving a COLA to opt into the reduced base allowance or risk losing their accumulated COLA to date.

      2. Implement a premium based (not actual claims driven) medigap insurance for all retirees 65 and older with no premium share, to maximize economies of scale put out a new RFP for a single payer national carrier to administer the plan which could limit possible vendors. This should result in reduced claims, as Medicare would be primary, and reduced overhead costs for the State’s selected secondary insurance provider. I’m not knowledgeable on the GASB requirements for recording unfunded health benefits liability and if the calculation is different for estimated enrollees of claims driven (Horizon’s NJ Direct) versus premium based (traditional HMOs) and if the State would benefit from a reduction in the unfunded health benefits liability by implementing a premium based medigap plan for all medicare eligible retirees.

      3. Implement a premium share for all non medicare eligible retirees similar to active members for the current baseline coverages (NJ Direct 10/15) and if a retiree chooses to select a high deductible plan there would be no premium share.

      4. All current defined benefit plans must remain in the State’s possession and control for obvious reasons. Any State, Local, or Quasi- Governmental employee receiving or entitled to receive a public pension from NJ would be excluded from any potential governmental DBP or DCP, no exceptions

      5. A constitutional amendment must include a dedicated revenue stream, in addition to redirecting all health benefit savings, to insure the State’s willingness and ability to meet its ARC going forward and must not diminish employees statutory right to accrued benefits earned. All parties would agree to drop the lawsuit ruling including any appeals and the recent ARC payment deficiencies would be amotized into the future payment schedule over a rolling 40 year period using a straight line method to stabilize funding source and recalcualed every 3 years by actuarial directed by an independent panel.

      It’s understandable no one likes to have something earned and promised taken away due to no fault of their own but everyone needs to be realistic to the inevitable alternative which would be devastating for all concerned. If freezing the defined benefit plan is part of new pension reforms, at a minimum the compromise point should be freezing nonvested members. The unfortunate reality of the situation requires reasonable compromise by everyone, the problem can’t be solved by just taxing or cutting and the longer we wait the problem continues to grow exponentially!

      Few factoids that may have already been mentioned, not looking to take sides, just trying to encourage dialog towards a workable compromise solution!

      Law enforcement do not pay into social security and therefore pay at a minimum 2% more into their respective pension fund which is why I suggested a graduated SS offset based solely on pension amount.

      Local PERS is better funded than State PERS so it can’t just be a benefit problem, the State has pulled the classic do as I say (make your ARC paments locals) not as I do (while we skip or short change our ARC paymdnts ).

      TPAF is in a similar funding crisis as State PERS because the State’s PTRF (GIT collections) funds most of the local share of pension & health benefits and like State PERS, ARC payments have been skipped or short changed.

      This problem started with Governor Whitman and has continued with all Governors, legislative bodies, and the citizens of NJ, because the majority of us elected these individuals to make the critical decisions for our State.

      I knew then, as well as others I’m sure, the pension bonds was a bad deal because it has perpetuated decades of mismanagement which has brought us to this point.

      Reply

    • Posted by Anonymous on April 12, 2015 at 8:36 am

      I see the SC toeing the line with a split decision as follows; ARC for pension YES and ARC for health benefits NO. Basis for decision pension nonforfeitable right, health benefits are not. Let’s get Vegas to set the odds.

      Reply

      • Posted by Tough Love on April 12, 2015 at 9:51 am

        While to the extent possible, as much of the already-accrued pensions for PAST service should be honored. meaning if doable WITHOUT more than minimal tax increases or further service reductions. I doubt that all can be honored, as the financial hole we are in is simply too great.

        And assuredly to do the above, MASSIVE reductions are need to

        (a) retiree healthcare promises (for BOTH Actives and those already retired), and

        (b) pension accruals for the FUTURE Service of all CURRENT workers … with the FREEZE proposed by NJ’s Pension Commission being the best solution.

        The goal for re-setting (a) and (b) should be Taxpayer contributions (as a % of pay) EQUAL TO but no greater than those typically expended for such purposes by large Private Sector employers.

        EQUAL …. but not better.

        Reply

        • Posted by BH on April 12, 2015 at 10:06 am

          Current PFRS members pay 35% of the premium of their healthcare now while employed and into retirement. FOREVER!!! Another reason why the pension freeze should exclude the Local plans….. Stupid is as stupid does.

          Reply

          • Posted by Tough Love on April 12, 2015 at 10:29 am

            Do you realize that it is extremely rare today for a private sector worker to be accruing ANY retiree healthcare subsidy AT ALL ….. very few will get ANYTHING.

            There is zero justification for taxpayers to pick up 100%-35%=65% of the same retiree healthcare costs for Public Sector workers ? And please don’t respond with the classic …. we get lees in “wages”, as that hasn’t been true for almost 2 decades now.
            —————————-

            And as to the healthcare cost of “actives” ……

            Yes, 35% is common healthcare premium cost-share in the Private Sector too, but because the Public Sector Plans are MUCH more generous and and hence costly, the 65% of Public Sector healthcare costs paid by the Taxpayers is FAR greater than the 65% of the less-generous costs subsidized by Private Sector employers. Bottom line ……. and gain with EQUAL, but not better as the appropriate goal …. is that the taxpayers should provide a subsidy EQUAL (in $$$) to what they get, and if you want that Platinum+ Plan (that you have today) YOU, not the taxpayers should be paying for the incremental benefits associated with that richer Plan.

          • Posted by BH on April 12, 2015 at 3:08 pm

            I’ll not be replying to you, TL anymore. Whoever you are, you’re clearly delusional. You know that I’m right on at least 70% of what I say. And you’ll even agree at times like how you say the 35% is on par for healthcare premiums both private and public sector…. When you know that’s a lie!!! Public sector now pays more!! But you then spew about retirement… Blah blah Blah!! You’re never going to be happy. So I give up on you. Thankfully, most others will as well. You’d be fine making something equal…. Even though equal is a relative term. Equal to now or when the private sector was in its prime during the tech bubble? Sure, I’d take equal to that. But no, of course you mean equal to what we have now in the private sector. Sure you do!!! So, by your low standards and logic, we should continue to dilute and limit everything until there is nothing left for anyone?!! Equal to nothing is….nothing!!
            Get out of your bubble!!! Get off your fake hypocritical horse and start taking responsibility for your own problems. The reason the private sector has no healthcare subsidies (not true, but let’s use your logic) is because we’re weak and without a union, were taken over and pushed aside. I blame people like you. The Monday night quarter backs who sit in the back seat and point fingers, for the private sectors decline. So, thanks TL. Thanks for ensuring everyone is equal to your standards. Thanks for sitting back and talking while the rest go out and do. There will be no pension overhaul without substantial give backs from the taxpayers!! Live with it!! Gripe about it!! But just simply pay!!!
            Im done with you. And your over and over endless copy and paste equal to.. BS!!!!

          • Posted by Tough Love on April 12, 2015 at 6:11 pm

            Interesting response,…. you ADMIT to being perhaps 70% correct, which means that you are perhaps 30% wrong. Why do you state things that you know are wrong ?

            As far as I know (and I’m VERY knowledgeable on pension funding and design) 100% of what I say is correct … and if you find something that I’ve stated incorrectly, and I cannot respond why you are wrong, I’ll admit to it.

            Now I suggest that you read my last comment a few times … trying to put aside your HUGE bias (as one whose family is riding this Public Sector gravy train) and ask yourself …. are my proposals realty not reasonable….. especially because the focus of my proposals is to advocate for EQUAL Public/Private Sector pensions &benefits.

            Got a problem with EQUAL that’s a tough position to justify ?

  8. Posted by BH on April 7, 2015 at 2:28 pm

    Chris Christie is another animal in itself. He’s done zero for the state….. Nothing!! Yet people back him and think he’s the savior!! We are ranked last in every single possible statistic or poll you could take……. about….anything!!! Even his pension reform is all smoke and mirrors!! He’s failed this state and has already forgotten about it. He benefits the elite and could care less about anyone else. It’s a proven fact!! He’s a bully, looking for scape goat at every turn, a liar and a crook.
    What scares me, is he will NOT get the nod to run…although I wish he would because he would never win, we know this…but he’ll come back to this state broken and out for more blood. He’s like a baby child, who when beaten, will take his ball and run home with it. He will continue to sink this state out of pure spite but not before he lines the pockets of all his elitist pals!!!
    You’ve been warned!!!

    Reply

    • I would not say Christie did nothing. He kept a lid on taxes long enough (barely) for me to sell and get the $#%# out of NJ. I can now watch from the sidelines as Trenton’s spendthrifts commit “staticide”

      Reply

  9. Posted by Carlos on April 7, 2015 at 6:38 pm

    Private sector coddling about to come to a painful,yet long over due end. It will be a decade before a republican wins state wide again. The debt and borrowing of this administration is unmatched. The great republican experiment is coming to a close and the clean up will be harsh,but just. You do deserve what you vote for.

    Reply

  10. Posted by Anonymous on April 7, 2015 at 9:48 pm

    Sell the turnpike! TL doesnt use it anyway

    Reply

  11. Posted by Tough Love on April 7, 2015 at 10:35 pm

    THIS is the RESULT of the Collusion between the Public Sector Unions and our taxpayer-betraying Elected Officials:

    http://calwatchdog.com/2015/03/31/dwp-employees-paid-up-to-three-times-that-of-private-sector/
    ——————————

    Dear Taxpayers ….. Renege on ALL of the outrageous pension benefit “promises”, everywhere ….. ZERO future funding.

    Reply

  12. Posted by fouls123 on April 8, 2015 at 12:34 am

    Why stop there? If that works, renege on all contracts. Refuse bond payments and all obligations. Good luck with any of that.

    Reply

    • Posted by Tough Love on April 8, 2015 at 1:09 am

      Quoting…. “Why stop there?”

      Because, while Elected Officials deserve the primary “blame”, its the WORKERS who are the financial beneficiaries of the COLLUSION between their Unions and our Elected officials….. specifically, the trading of Public Sector Union campaign contributions and election suppose for favorable votes on pay, pensions, and benefits.

      So THAT’S where the Taxpayers must look to right this wrong … by refusing to fund this double-dealing … at their expense.
      ——————————————————–

      The Bond holders aren’t party to any deal that CHEATED the Taxpayers …. so why punish them ?

      So tell me why ….. other than you wanting to make THEM the convenient patsy so you don’t have to give up your grossly excessive and unjustly-obtained pensions and benefits.

      Reply

  13. Posted by Anonymous on April 8, 2015 at 9:11 am

    Let all ignore her and I bet she will shrivel up and die before the pensions do. lol

    Reply

    • Posted by Tough Love on April 8, 2015 at 12:27 pm

      Yea, when you can’t refute a reasoned argument, just bet that those with that more reasoned position will …. “shrivel up and die”.

      Are you one of the “best and brightest” that the Taxpayer pay so much for ?

      Seems like they need to up that standard quite a bit.

      Reply

  14. Posted by Anonymous on April 9, 2015 at 2:15 pm

    For anyone interested Paul Mulshine has an interesting take on the possible outcomes

    Reply

    • Posted by Tough Love on April 9, 2015 at 9:01 pm

      The list with the suggested Police “revenue streams” should be re-named …..

      “DEDICATED fees needed for ONE purpose only … to fund Police pensions”.

      What a show of arrogance and disdain for the Taxpayers. !

      Reply

  15. When will the pension COLA case be decided?

    Reply

    • Posted by Anonymous on April 11, 2015 at 8:19 pm

      COLA case forthcoming, courts probably waiting for ARC case to clear log.Actually both cases could be used by either side to deem all reforms null & void because both the ARC funding & suspended COLA were an integral part of the reforms resulting in P.L.2011, c.78. Regardless of your opinions pro or con a “deal” was made and both sides knew about the upcoming financial obligations, as another post said maybe the hope was some significant economic turnaround that didn’t materialize. I think cooler heads need to prevail to solve this problem, that only happens with communication and a commitment for reasonable compromise. That means Republicans need to swallow their no tax pill. Democrats need to do the same on the expenditure side (eliminate SAVER), unions and their membership have to be ready for additional tweaks to age/service eligibility as well as premium share for retirees. However given we are where we are because as always in good times and especially in bad times, P&B is easy to cut to balance the budget a “dedicated” revenue stream has to be established for future ARC funding or else no amount of reforms will solve the problem.

      Reply

      • Posted by Tough Love on April 11, 2015 at 8:55 pm

        Yes, “tweeks” ….. big enough to reduce Public Sector pensions & benefits to a level NO GREATER than those typically granted Private Sector workers.

        Which assuredly translates into a 50+% reduction for misc workers & teachers, and a 2/3-rds reduction for safety workers.

        EQUAL ….but NOT better.

        Reply

  16. Posted by BH on April 12, 2015 at 10:04 am

    Oh lord TL, YOU SOUND LIKE A BROKEN RECORD ALREADY!!!!

    Reply

    • Posted by Tough Love on April 12, 2015 at 3:31 pm

      Truth hurts ?

      Got a problem, with pensions & benefits EQUAL TO …. but NOT better …. than your Private Sector counterparts ?

      Reply

      • Posted by Anonymous on April 12, 2015 at 8:40 pm

        Hopefully TL & BH can agree on this, regardless of current or future reforms IF the politicians keep using P&B to balance the budget and do not fund the required ARC, whatever it is or will be, the funding problem will continue?
        FYI, I’m the anonymous that wrote the long winded suggestion on pension reforms. Also, regardless of the sector there’s at least two working class the executives/politicians and the rank & file.

        Reply

        • Posted by Tough Love on April 12, 2015 at 9:40 pm

          The “ARC” is the sum of the “normal cost” (i.e., the annual contribution necessary to fund current year accruals) and (b) the amount needed in the year to amortize any existing UAAL.

          Let’s address them separately ………

          (a) I certainly agree that the “normal cost” of pension accruals EQUAL TO those typical granted Private Sector workers should be fully funded annually. The problem is that few Public Sector workers are willing to accept pension accruals EQUAL TO their private Sector counterparts, now ROUTINELY getting multiples more, and wanting to keep it that way. Should taxpayers fully fund the “normal cost” of this much HIGHER level of accruals ? Not in my opinion …. as it’s not necessary, just, fair to taxpayers, or affordable.

          (b) If taxpayers agree to fully fund the (currently HUGE) UAAL, they are effectively accepting as reasonable the level of pension accruals of years past that underlie the UAAL. Believing that Public Sector pension promises have ALWAYS been more generous than what was necessary, just, fair to taxpayers, or affordable, I see no overriding obligation to fully fund it. That being said, I believe that Taxpayers should do their best to fund as much of such past service accruals as is reasonably possible WITHOUT more than very modest tax increases and very limited further reductions to services …… and then ONLY if Public Sector workers get-on-board with VERY material reductions for their FUTURE service …. ala my discussion in (a) above.

          Reply

          • Posted by Anonymous on April 13, 2015 at 7:25 pm

            It’s a conversation point, only thing is in your b) above the let’s split the past UAAL which is compromised of your higher benefits noted in a) above and the amounts not funded previously that could/should have been. Bootom line I agree reforms are required but it needs to be a balance of benefit cuts and funding sources (ie existing reallocations and/or new).

          • Posted by Tough Love on April 13, 2015 at 8:42 pm

            If this is what you are saying, I agree ……. TO THE EXTENT taxpayer contributions over all past years (together with the earnings thereon) are insufficient to fund (their share) of a pension EQUAL to but no greater than that typically granted comparable Private Sector Taxpayers, then yes the Taxpayers SHOULD make up that shortfall……. and we should ONLY fund up to that level.

            Even with the low amounts contributed, that may or may not be true.

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