OPEB – One Pretty Expensive Benefit

In working up a countywatchers blog comparing insurance costs for county governments in New Jersey I needed a link to an explanation of OPEB in New Jersey and one of my old nj.com blogs came up which I reproduce below word-for-word from 2009.  What strikes me is that:

  1. so little has been written explaining governments’ liability for OPEBs that my six-year-old blog would come up near the top of a search; and
  2. OPEB liabilities have gone down.

I expected (1) but (2)? The latest OPEB valuation for New Jersey (July 1, 2013) lists total Accrued OPEB Liabilities as $66.8 billion which is less than the $68.8 billion reported back then.  With more people in the system and New Jersey still providing those ‘cadillac’ benefits that supposedly would save the state $3 billion annually if cut back to ‘gold’ how are these liability reductions coming about (if not by actuarial voodoo ordered up by politicians)?

The main reason that state and local governments will be going broke is that they will be paying for services provided not to current taxpayers but to past generations. Politicians, the gutless cowards that they are, have consistently paid off public employees in promises for future generations to fulfill. They promise them Defined Benefit pensions and health care for life (otherwise known as OPEBs). Those pension promises are being funded, in theory, but as for OPEBs not only are states not prefunding but, until recently when accountants forced them to, there wasn’t even an estimate of how much those promises would cost. Now we have one.

On the same day that a group of people who don’t have to worry about their own health insurance coverage made up rules for the rest of us, the good folks at the Center for State and Local Government Excellence released a report reviewing OPEB valuations provided by all 50 states and putting a number on the total cost to taxpayers. That number is $558 billion.

Among the highlights from that report:

New Jersey is number one
In total unfunded liability ($68.833 billion), annual cost ($5.84 billion), per-person cost ($7,946.92), unfunded as a percentage of the budget (139.66%), and annual contribution as a percentage of the budget ($11.85%) New Jersey is far ahead of every other state.

OPEBs can be cut
From page 40:

“The majority of states have constitutional provisions that describe how their retirement plans are to be “funded, protected, managed, or governed.” However, retiree health plans are not accorded similar status. Reductions in or elimination of retiree health benefits may be constrained by collective bargaining contracts, but in general, legislatures have flexibility to reduce and modify retiree health benefit plans for public sector employees.”

Politicians now know the numbers. They understand that OPEB benefits can be bargained down – or away. It wont’ matter. In New Jersey, at least, they won’t do a thing but wait for Washington, DC to send them a savior who can deliver both universal health care to disappear their deficits for them and ignorant voters to win their elections for them.

85 responses to this post.

  1. Posted by Tough Love on June 29, 2015 at 12:19 pm

    The MOST important part of what you stated is:

    “The main reason that state and local governments will be going broke is that they will be paying for services provided not to current taxpayers but to past generations. Politicians, the gutless cowards that they are, have consistently paid off public employees in promises for future generations to fulfill.”

    And the reason the politicians pass these costs onto FUTURE generations is because they don’t have the money to pay for the promises IN THE YEAR ACCRUED ….. and THAT is because these promises are grossly excessive by every and any reasonable metric …… TYPICALLY 3x-4x (4x-5x for Safety workers) greater in value at retirement than those of Private Sector workers who retire with the SAME pay, with the SAME years of service, and at the SAME age.
    ———————————————————————————-
    We CANNOT go on the this way … granting accrual on the same terms that are in place today.

    The pension Commission had it right. The DB Plans must be frozen for all CURRENT State and Local workers and their “Platinum+” healthcare coverage must be materially reduced (to a level comparable to what Private Sector workers typically get from their employers).

    Reply

    • Posted by Anonymous on June 29, 2015 at 1:58 pm

      the most important part is that they never made the contributions so they could give the tax payers breaks and be voted into office

      Reply

      • Posted by dentss dunnigan on June 29, 2015 at 2:39 pm

        I hardly think having the highest tax burden in the country is giving taxpayers breaks …..

        Reply

        • Posted by Anonymous on June 29, 2015 at 3:11 pm

          you dont see any millionaires moving out of the state of NJ, to the contrary, they love it here.

          Reply

          • Posted by dentss dunnigan on June 29, 2015 at 5:33 pm

            Well there you go again ,looking at Statistics in the rear view mirror .NJ has fallen to third overall in millionares because other states have gained with them moving in …we don’t gain them or companies because of our progressive taxes .

        • Posted by bpaterson on June 29, 2015 at 3:17 pm

          dents-just think if they hadn’t given up tax breaks!!!…although NJ in the #1 position with the possibility of having even perniciously higher taxes would still leave us as the #1 position… in the statistical sort of way.

          Reply

        • Not only do we have the highest tax burden but we receive less in services. Our roads are the worst as is our business climate. Just tax the millionaires that’s the answer! Keep taxing and taxing and see what gives. These public takers need only look to Greece, Puerto Rico, Detroit, etc. They are too indignant and ignorant to consider that what we are seeing elsewhere is only the beginning of the long and painful demise of their overly generous salaries, benefits and pensions. Need to wake up to the “new Norma” Save for your own retirement.

          Reply

      • Posted by Tough Love on June 29, 2015 at 2:49 pm

        It’s a one-to-one relationship.

        BECAUSE the Public Sector Plan “generosity” is 3x-4x greater than what is fair to taxpayer (meaning what THE Taxpayers typically get in pension/benefits form their employers) it follow that the calculated ARC are ALSO 3x-4x greater than what is fair to the Taxpayers.

        It’s quite probable that Taxpayers have indeed funded aa amount towards Public Sector workers pensions EQUAL to what their employers have contributed to their pensions …… and owe you NOTHING.

        Reply

      • Posted by S Moderation Douglas on June 29, 2015 at 2:58 pm

        Thank you, Anonymous…….”It’s only logical.”

        California employee costs seem to be similar to New Jersey, but in 1994, the Constitution was amended to give CalPERS plenary authority.

        CalPERS does not request or suggest the annual contribution. Whatever CalPERS bills the state or local government is not subject to any vote or veto.

        Sounds kind of ruthless, greedy, or self indulgent, but it was passed for a reason: Governors with sticky fingers who looked at CalPERS as their own personal or political slush fund. Thank you, Pete Wilson.

        It looks as though the local governments in New Jersey have managed to keep a similar responsible record of contributions even without plenary authority, but the state has not.

        Doesn’t that say something right there? Logically:

        “The main reason that state and local governments will be going broke”…. is not: “because these promises are grossly excessive by every and any reasonable metric…”

        It’s because politicians took the money that should have been contributed to the pension system and spent it on current expenses, or current tax breaks. For over a decade.

        CalPERS is not out of the woods, there is still considerable risk. They are taking balanced steps to control that risk. Like CalPERS, New Jersey local pensions are not exactly strutting in high cotton, but they are both much better off than NJ state, not because their salaries and benefits are lower, but because they responsibly (relatively) paid their bills on time.

        Moderation in all things – including moderation.

        Ben Franklin

        Reply

        • Posted by bpaterson on June 29, 2015 at 3:29 pm

          mr douglas, I read your post and your reasons for the state going broke you noted were either one or the other (excessive labor costs versus politician piggy bank), actually it is both figured in heavily and as a one two punch. The state judicial level (ulterior controlled by the legislative level) created such a burden with funding pensions along with the abbot v burke school funding decision and the politicians just could not dump all those costs directly and together on the taxpayers shoulders without creating financial stress in the homeowner system; since the homeowner already is paying huge property taxes based on the local labor costs being incurred. So labor costs absorbed into taxes could only be one one one level, not both.

          But looking back, I could only wish the calpers funding mandate was instituted in NJ. The politicians would have looked twice at what they were doing to the labor cost burden as it accrued from 1999 to 2009 as it increased exponentially.

          Reply

          • Posted by Tough Love on June 29, 2015 at 11:28 pm

            Quoting … “But looking back, I could only wish the calpers funding mandate was instituted in NJ. The politicians would have looked twice at what they were doing to the labor cost burden as it accrued from 1999 to 2009 as it increased exponentially.”

            Exactly, you see (notwithstanding S. Moderation Douglas’s opinion to the contrary …. an opinion which CONTRADICTS the AEI Study he likes to quote. Yup, per that study, 23% higher PUBLIC Sector Total Compensation in NJ, and 34% including in the much greater value of PUBLIC Sector job security) Public Sector pensions and benefits ARE indeed “grossly excessive”, and hence VERY VERY VERY costly. So “costly” that if our Elected Officials HAD TO pay for the year’s accruals IN THE YEAR GRANTED, it would simply be IMPOSSIBLE ….. and these grossly excessive pensions & benefits would never have been granted in the first place.

          • Posted by S Moderation Douglas on June 30, 2015 at 2:50 pm

            I crack up every time Tough Love repeats the “23%”.

            I predicted that the first time I ever linked the AEI study.

            It is still a hoot.

            ” Moderation in all things — including moderation.”

            Benjamin Franklin

    • Posted by Anonymous on June 29, 2015 at 3:52 pm

      highest tax burden, very misleading as TL statements often are. I used to live in NJ and now I live in Florida. Florida has tax on gasoline so gasoline is much more expensive than NJ, an everyday expense that really adds up. Florida has tax on clothes, there is none in NJ. Plus the price of groceries is much higher in florida than in NJ. NJ is definitely a less expensive place to live overall than Florida. I can speak from first hand experience. I also paid 400 for car insurance for two vehicles in NJ and now in florida I paid 1200. and lets now forget about homeowners insurance, it is extremely high because of hurricanes, much higher than NJ. TL likes to paint a phoney picture often based on one factor alone.

      Reply

      • I call BS on car insurance bring more in Florida than in NJ. I call BS on $400 insurance for 2 cars in NJ. And while homeowners insurance is higher, NJ is about to get another knockout punch to taxpayers with flood insurance rates over next 4 years. This state is finished !!!! Kick the canoli is about to come to an end and reality will finally hit everyone.

        Reply

        • Posted by Anonymous on June 29, 2015 at 4:14 pm

          javagold you are wrong, it cost me even less than 400 for liability only on two vehicle in NJ. I had NJ Manufacturers and never had accident or ticket, they often gave me back money at the end of the year, in Florida I pay at least 1200 and they say that is because I am also responsible for what other drivers do, I must pay for their issues as well as my own in Florida. I guess you have tickets and accidents, if not get NJ manufacturers insurance

          Reply

          • No tickets. No accidents. (At least past 8+ years). Don’t live in a urban city. I do have collision and comp. perhaps that’s why I’m paying $1500 for 2 cars ?????? (And i have been told I have lower rate than others In NJ i speak with so I stopped even looking past few years and just paid the extortion fees)
            So I won’t call you a liar, but I never have anyone have $400 for 2 in NJ !!!

      • Posted by Tough Love on June 29, 2015 at 11:35 pm

        Really?

        (a) Florida has a ZERO State Income tax

        (a) You you might have insured 2 cars in NJ for $400 in the 1960s. Today, the ins. for ONE care for an adult with a clean driving record AVERAGES over $1,000 Annually.

        Reply

        • Not only does FL have zero state income tax but car insurance and real estate taxes are significantly lower as are tolls, fees and insurance. Food prices are about the same except for year round locally grown fruits and vegetables which are very inexpensive. Utilities are literally half of what they are in NJ. I have same size home as when in NJ and with AC utillities are literally half of what i was paying in NJ. Roads are beautiful which means less wear and tear and damage on my vehicle. Gas is a somewhat higher but I have a very efficient car. Yes there is tax on clothes but with more of a year round climate one does not need as many clothing items. No where is perfect and FL certainly has its share of issues but one can live much much cheaper and have a better quality of life. Much better business climate so there are many more private sector jobs which means people are working! No beach fees, beautiful free beaches, you get the idea.

          Reply

          • Posted by S Moderation Douglas on July 1, 2015 at 1:20 pm

            Before you move to avoid the “highest taxes”, check out this info:

            http://www.itep.org/whopays/full_report.php

            The trouble is, when you talk about “high tax” states like New Jersey or California; and “low tax” states like Mississippi or Texas, you are comparing average or per capita taxes. Turns out, often “low tax” means low for the highest income earners, and higher for everyone else.

            New Jersey, as I recall, is very similar to California in that, if you earn about the median income or less, (say $60,000 a year) your combined state and local taxes, as a percent of income, will be about average, or slightly less, than for the nation as a whole. The top percentile in both these states do pay much more than the average for that percentile nationwide.

            In California, or New Jersey, if you are in the top 5% of earners, you can expect to pay about 8.7% of your income on state and local taxes. In Texas, the same income group can expect to pay 4.7%

            The “average” tax in each state only matters if you are “average” yourself.

            Florida……prime example. If you are in the lowest quintile (less than $17,000 a year) expect to spend over 12% of your income in state and local taxes. If you’re in the top 1% (average income $2 million) only 2%

            Even in the high tax states, though, if you are earning over a half million a year, you are probably paying a lower percentage of your income in state and local taxes than your gardener.

            Moral of the story; “averages” can be deceiving. And it’s better to be rich than poor.

        • Posted by Anonymous on June 30, 2015 at 1:53 pm

          So when you moving sunshine?

          Reply

  2. Pull the health benefits from ALL public takers. Simplest place to START. Then work your way from there until ALL Public takers cry GREECE !!!!

    Reply

  3. Posted by fouls123 on June 29, 2015 at 8:07 pm

    To quote TL” And that’s because politicians don’t have the money to pay for them in the year accrued.” In most years the state contributed nothing in the past 20 years. so you are saying the state could afford to contribute nothing? You have to admit that contributing nothing was bound to bring about disaster even if benefits were low. You just can’t in good conscience contribute nothing for years while paying down on all other obligations. There is no excuse for such behavior. Whitman created tax cuts with no budget cuts to balance them. Instead, the tax cuts were balanced against the future benefits of public workers and at the expense of no one else.

    Reply

    • Posted by Tough Love on June 29, 2015 at 11:43 pm

      Quoting….. “In most years the state contributed nothing in the past 20 years. ”

      Where do you pick up such BS ???

      Christie’s administration ALONE has contributed over $4 Billion, and a similar amount from Corzine’s years in office.

      Reply

      • TL, the publics like to twist things around and say that nothing has been contributed but what they are in denial about is that there is NOTHING to contribute for all of the corrupt and unethical reasons discussed here

        Reply

        • Posted by S Moderation Douglas on June 30, 2015 at 3:24 pm

          The “publics” like to twist things?

          TL is the master twister. (Well, maybe second to CC)

          Apparently you agree with TL that “your opinion” of the correct level of benefits supersedes state law.

          Even Gov. Christie has stated many times that, if he could, he would pay “every nickel” due the pension system.

          Take your alleged “corrupt and unethical reasons” to the courts and prove your case. Until then, we all follow the law, even if we don’t agree totally. It’s the only civilized way.

          Reply

  4. amen. pay nothing into the pension system and use that money to balance your tax cuts budget. the public workers have already paid their “fair share”. try telling your home mortgage bank that you can’t pay your mortgage for years because you want to take a vacation. the problem with the pension is the fact that the nj taxpayers have not paid their public workers for 20 years. Now the bill is due. case closed. pay up.

    Reply

  5. Posted by Anonymous on June 29, 2015 at 10:00 pm

    Yeah it’s been a lose lose situation, woefully inadequate funding and over generous benefits. Problem is there’s no magic bullet to undo the years of neglect. So everyone needs to pony up to solve the problem. We need a constitutional amendment detailing P&B like reforms and a dedicated funding source. This is the only way publics/taxpayers can minimize political involvement going forward.

    Reply

    • Posted by Tough Love on June 29, 2015 at 11:47 pm

      The State funding is only “inadequate” to fund a benefit 3x-4x greater than what is necessary, reasonable, fair, and affordable. Taxpayers have likely fully funded a pension EQUAL to what they get ….. and if so, we owe you NOTHING.

      Reply

      • Posted by Anonymous on June 30, 2015 at 7:52 am

        So are you now saying the heck with the P&B Commission reforms and a dedicated revenue stream for funding?

        Reply

        • Posted by Tough Love on June 30, 2015 at 1:27 pm

          Anon, my point is that taxpayers should “contribute” towards Public Sector pensions an amount that is very close (as a % of pay) to what they get from their employers. This is reasonable and appropriate because with Public/Private Sector cash pay being near equal in NJ, adding EQUAL pensions and benefits will result in near-equal “Total Compensation” …. a goal I have always advocated for.

          The Publics want and blame Taxpayers for not fully funding pension/benefit promises that are routinely 3x-4x greater in value at retirement than what we get …. and hence 3x-4x more costly. There never was, isn’t now, and never will be justification for the TAXPAYERS to fully fund such extravagant pension & benefits.

          Yes, NJ taxpayers have contributed FAR less, but quite probably 1/4 to 1/3 of it (averaged of all years), and if so, the Taxpayers contributions HAVE ALREADY MET a reasonable and appropriate standard, that being contributing EQUAL to what they typically get from their employers. If we (the Taxpayers) have indeed contributed LESS than the 1/3-1/4, we should make up for that shortfall.

          My primary focus has been stop digging the financial hole NJ is in even deeper, by ending the grossly excessive pension accrual rate in place today, and to very materially lower (ALL THE WAY down to what comparable Private Sector workers typically get from their employers) the “platinum+” healthcare coverage both active and retired Public Sector workers get today. For pensions, this means FUTURE Service pension accrual-rate reductions.

          Barring financial calamity, I most often do not call for reductions in PAST service accruals ALTHOUGH JUSTIFIED. Much of the 3x-4x greater Public Sector pension accruals are ALREADY in the PAST Service accrual column. And like I stated initially, if Taxpayer have already contributed as much to the Public Sector workers’ pensions as what we have received towards ours (from our employers), there is indeed a justifiable basis to say …… “we owe you nothing”.

          It’s just that I do not calling for wiping out the UNJUST past-service accruals. If by implementing the NJ pension Commission’s proposals to freeze the current DC Plan (replacing it for Future Service with a Plan comparable to what Private Sector workers typical get) and VERY materially reducing healthcare subsidies, perhaps (???) the UNJUST past-service accruals can be amortized over some reasonable w/o reducing those as well …. even though justifiable (but legally difficult) to do so.

          Reply

      • Posted by Anonymous on June 30, 2015 at 9:00 am

        TL,
        I’m not looking to rehash what came first, the chicken or the egg. I’m focusing on what needs to be done to solve the problem. That’s what we all should be doing.

        Reply

  6. Posted by Anonymous on June 30, 2015 at 8:47 am

    Hey TL,
    How could anyone tire of your one line of thinking? LOL, I laugh so much reading pretty much the same thing over and over. For everyone on this site, TLs single line of diatribe is truly truly barren. Barren from where it springs and barren for how much it lacks some of the fundamental ideas that form the basis of the republic. Help be thy brothers keeper…or TLs version, sc4ew everyone else. See, TL gets on here talks about forcing a minority of workers into abject poverty, at the same time as a self employed business person sucks tax revenues from the state through the largess of the tax code that allow s/e business owners to write off air. Yeah, you took a risk and deserve the goods, but you and I both know how much is skimmed from the coffers by those deductions that stretch off into the endless sunset. Empty. Immoral. About taking from someone else but not me. Just to quiet your paranoia, I’m private. I’m sure I’ll get paragraphs of the same. Barren they are and barren at the core is what drives them out.
    The other side of TL’s coin is that while the middle has been gutted over the last 25 years, it’s a race to the bottom. Don’t you know? TL believes you should be grateful to be a (wage) slave and pay your employer for the right of giving up you wages for free. Serf. Those publics should to be brought down to everyone else’s level…spoken like a s/e owner siphoning off funds from the middle through the largess of the (tax) code. Haven’t you read (TL)? They’re coming with pitchforks for the likes of you and me.
    Not sure if you read the NJScotus position, they won’t insert themselves into the legislative process, the language of the majority position stated the pubs have ALREADY earned their wages that are to be paid. Where oh where will the money come from indeed. As I have said over and over, the fed will not bail the state. The state chooses politically to ignore a funding item until it’s a crises. It’s a shame for ALL of us they turn their backs on all of us. (Calm down TL, I’m private) In order to cover the pensions the state will shift pubs onto the exchanges. Pubs will most likely need to face reductions of 30% in order to keep the funds realistically solvent. Folks on here inflate numbers which are actuarial low, into a place where no solutions exist, while larger numbers make them feel better about walking away from responsibility. Taxes will be raised and/ or assets (like the TP or GS Pkwy) will be sold or shifted as dedicated funding. Corzine’s idea of securitizing flows from the roads either for the Trans. Trust fund or towards pensions was ahead of its time even though it still remains unpalatable politically.
    A solution that is fair to the existing pubs who have earned their wages and is generationally fair to those behind is a moral way forward. TL can crow all she wants that pubs should get less, but as I said above, she thinks we should all accept this slide we are on to the bottom. The pitchforks are coming if those who know continue to want to pretend not to see and listen to the echo chamber as the footsteps only get closer.

    Reply

    • Why don’t you let us all make up our own minds as to how we interpret TLs comments or your comments for that matter.

      Reply

      • Posted by Anonymous on June 30, 2015 at 9:09 am

        Isn’t that what they and you are doing by posting comments? No censorship, unless again we’re going to appeal to NJSC – LOL.

        Reply

    • “Race to the Bottom” is a public sector rallying cry, so your oft repeated claim to “being private” is BS. The only supporters of the ridiculous PS pensions and medical benefits are the PS drones. Stop talking out of both sides of your mouth. Financially not feasible means exactly that – just look at the pensions in Greece and Puerto Rico to see where you and your cronies are going to end up.

      Reply

    • Posted by Tough Love on June 30, 2015 at 2:24 pm

      Read my ABOVE response to a different “Anonymous”.

      Reply

    • Posted by Tough Love on June 30, 2015 at 2:58 pm

      Hey Anon, I see that you posted the SAME BS just a few days ago (but a bit briefer) where you said:

      “Hey TL,
      How could anyone tire of your one line of thinking? LOL, I laugh so much reading pretty much the same thing over and over. For everyone on this site, TLs single line of diatribe is truly truly barren. Barren from where it springs and barren for how much it lacks some of the fundamental ideas that form the basis of the republic. Help be thy brothers keeper…or TLs version, sc4ew everyone else. See, TL gets on here talks about forcing a minority of workers into abject poverty, at the same time as a self employed business person sucks tax revenues from the state through the largess of the tax code that allow s/e business owners to write off air. Yeah, you took a risk and deserve the goods, but you and I both know how much is skimmed from the coffers by those deductions that stretch off into the endless sunset. Empty. Immoral. About taking from someone else but not me. Just to quiet your paranoia, I’m private. I’m sure I’ll get paragraphs of the same. Barren they are and barren at the core is what drives them out.”

      To which I appropriately responded:

      “Will you be laughing when (in about 5 years) NJ’s pension Plan assets start hitting zero and find that even Democratic Legislators won’t raise taxes sufficiently (by about $8-10 Billion) to continue payouts to those ALREADY retired? Of course, long BEFORE that, anything that might have been available to pay the pensions of FUTURE retirees would have been long gone.

      You really should reconsider the efficacy of “denial” as a rational postilion ………………
      ——————————————————————

      Quoting …”TL gets on here talks about forcing a minority of workers into abject poverty”

      I have ALWAYS advocated for Public Sector workers to get “Total Compensation” (pay + pensions + benefits) EQUAL to their Private Sector counterparts. Are those Private Sector counterparts really in ….”abject poverty” ?”

      Reply

  7. Posted by fouls123 on June 30, 2015 at 1:55 pm

    Between 1998 and 2011, in 9 of 13 fiscal years the state budget appropriated zero for pensions and benefits including Christie who skipped payments altogether in 2010 and 2011. and only Corzine made a full payment in 2007 and 2008..Whitman made reduced payments in the years she made any; 1995 1996 and 1997.

    Reply

    • Posted by S Moderation Douglas on June 30, 2015 at 3:04 pm

      fouls 123;

      I assume you are responding to Tough Love:

      ‘Quoting….. “In most years the state contributed nothing in the past 20 years. ”
      Where do you pick up such BS ???’
      _____________________

      Thank you for finding and posting that information again.

      Christie’s “insatiable beast” is not the workers or the unions, or the pension system. It is the government that robbed from Peter to pay Paul…….and now is blaming Peter.

      Let your reasonableness be known to everyone.

      Philippians 4:5

      Reply

      • Posted by Tough Love on June 30, 2015 at 3:28 pm

        S. Moderation Douglas,

        Not really pertinent …

        Read my response to Anonymous time-stamped June 30, 2015 at 1:27 pm above.

        THAT is what matters. If Taxpayers have contributed towards Public Sector pensions an amount equal to what they receive from their employers we have paid all that we justifiably should pay.

        And assuredly we have already paid that (or very close to it) and the HUGE HUGE unfunded liability in NJ’s Plans is simply the result the the Grossly Excessive Public Sector pension “promises” accompanied by HUGE “cost-requirements”….. also 3x-4x greater than what it costs to fund Private Sector pensions (that are TYPICALLY 1/3 to 1/4 the value at retirement of Public Sector pensions).

        Reply

        • Posted by S Moderation Douglas on June 30, 2015 at 5:59 pm

          Tough Love,

          I read all your responses, brother. (Almost, you know how it is.)

          “Not really pertinent …” ? The law is not “really pertinent” ?

          “THAT is what matters.” (“That” being TL’s opinion)

          Take it to the courts. See how far TL opinion goes vs the law.

          Take your spreadsheet. Explain the “3x-4x greater cost” and “TYPICALLY 1/3 to 1/4 the value at retirement of Public Sector pensions” Yadda, yadda, yadda.

          Don’t rant. They abhor spittle in the courtroom. Calmly explain to them how a hypothetical Police Officer has pension and benefits at retirement equal in value to a mythical brain surgeon (really!)

          The legislature “wants” to fund the pensions. Gov. Christie would “pay every nickel” …..if….. he could. But, in TL’s opinion? Forget the law?

          I have met the enemy and he is us.

          Reply

          • Posted by Tough Love on July 1, 2015 at 12:04 am

            Yeah, It’s a shame ….

            Just terrible that I OBJECT to the enormous rip-off of Private Sector Taxpayers by the grossly excessive Pubic Sector worker pensions & benefits……isn’t it?

  8. Posted by S Moderation Douglas on June 30, 2015 at 5:32 pm

    OPEBs:

    What is a “platinum healthcare plan” and who is getting all that money? For what?

    During the Wisconsin Scott Walker flap, I read that state employees were getting health insurance worth average $20,000 a year. I assumed someone was grossly exaggerating, but later learned the insurance was through a non-profit insurer run by the union and was by all accounts excellent coverage.

    California coverage, on the other hand, is much less expensive. According to the last contract:

    CRAFT AND MAINTENANCE, Effective
    July 1, 2013 through July 1, 2015

    a. The State shall contribute $495 per month for coverage of an eligible
    employee. (Party code one)
    b. The State shall contribute $992 per month for coverage of an eligible employee
    plus one dependent. (Party code two)
    c. The State shall contribute $1,288 per month for coverage of an eligible
    employee plus two or more dependents. (Party code three)

    Those are the state subsidies. (80% of average plan cost) Employees who choose the less expensive plans pay little or no extra premiums. And the premiums do not increase with age. For a retiree not yet on Medicare, insurance plan costs are the same, but the state pays100% of the average plan, instead of 80%.

    I have been fortunate, and used the insurance mostly for regular checkups, but have heard very few complaints from co-workers; some with chronic problems like diabetes. Typical co-pay for an office visit or generic drugs is ten or fifteen dollars.

    What does one receive for the $31,000 a year that CC claims? I again watched the infamous clip this morning with CC and the teacher. He said the state subsidy for that teacher is $26,000 year (roughly, I don’t recall the exact number). Not just while you’re working, but when you’re retired, every year. As long as you live.

    Number one, I don’t believe that. I would like to see the Governor or his office document that. And number two, if it were true, where is that money going? I have heard the cost of living in New Jersey is high, and the cost of health care higher, but if state subsidies were reduced drastically, who would lose more, the employees or the insurance/healthcare conglomerate?

    Reply

    • Posted by Tough Love on June 30, 2015 at 6:19 pm

      S Moderation Douglas…..

      We’ve discussed this before. Perhaps you have a short memory (or it just helps to “forget” when it doesn’t support your agenda):

      NJ AETNA Freedom 10 Plan (non-Medicare Family Coverage). 2015 cost:

      State Retirees ….. Monthly Cost = $2,848.68 …. $34,184.16 annually

      Teachers …………..Monthly Cost = $2,597.73 …. $31,172.76 annually

      Other Local ……… Monthly Cost = $3,044.83 …. $36,537.96 annually
      ———————————————————————————

      And while I’m not sure who coined the term “Platinum+” healthcare coverage in NJ (perhaps it being our Governor Christie), the following NJ Public Sector coverage (with it’s linked website below) in my opinion certainly meets the definite of of what one would consider “Platinum+” coverage …… so much so that when taxpayers compare it to what THEY typically get from their employers, they’ll be INCREDIBLY PISSED-OFF.

      The following is a summary of the in-network coverage features:

      (a) Doctor’s office visits $10 for SPECIALISTS as will as Primary care doctors
      (b) Blood test, Cat-Scans, MRIs …. $0
      (c) Generic Drug copay …… $3
      (d) Brand or “Specialty” drug copy ……… $10
      (e) Outpatient surgery ….. $0
      (f) In-hospital facility fee…..$0
      (g) In-Hospital Physician and Surgeon’s fee …. $0
      (h) pregnancy changes for Delivery and In-patient service ….$0

      Source … http://www.state.nj.us/treasury/pensions/hb_open_enrollment_2012/sbc/sbc017.pdf

      Reply

      • Posted by S Moderation Douglas on June 30, 2015 at 6:56 pm

        You still crack me up.

        Yes, brother, I vaguely remember. I don’t have the charts handy on individual vs married vs family costs. But I do recall the “average” is well below $31,500. (“Average” remember that? Like that 23% average thingy?) CC is talking as if everyone is receiving the family retired not on Medicare rate.

        The average worker in New Jersey does not receive a $26,000 healthcare subsidy every year “till the day you die.”

        I could check, if I cared enough, but I believe CalPERS negotiates group coverage that includes all ages, working or retired. So family coverage for retired – not – on – Medicare is the same as a young working family. Essentially, the younger workers subsidize the older. And the average state cost is about $10,000 a year per employee. (Not including retiree healthcare costs.)

        My coverage looks similar, but I believe I have a $50 charge for ER visits or pregnancies.

        Reply

        • Posted by Tough Love on June 30, 2015 at 7:32 pm

          Well, YOUR California-provided coverage may look similar (I’m not surprised. After all, you ARE a Pubic sector retiree sucking at the taxpayers pockets, just like all others), but such EXTRA ORDINARILY GENEROUS “Platinum+” coverage is nothing like the FAR FAR less generous covered granted Private Sector workers … where RETIREES generally get ZERO in employer-provided subsidies today.

          Reply

          • Posted by S Moderation Douglas on July 2, 2015 at 3:11 pm

            Actually, for about eight years, California paid nothing for my insurance. At the time, I was paying about thirty dollars a month, and the state paid the rest. I married a woman who had an identical policy through her employer, with the same HMO. But her employee paid the entire premium.

            Go with my employer and pay about sixty for the two premiums? Or go with hers and pay nothing? Hmmmm?

      • Posted by S Moderation Douglas on June 30, 2015 at 6:58 pm

        My agenda

        You’re killing me here.

        Truth, justice, and the American Way. That’s my agenda

        And Moderation, of course.

        Reply

        • Posted by Tough Love on June 30, 2015 at 7:35 pm

          Hardly. Your “agenda” is to not give-back one iota of your multiples greater, pension & benefits ….. never necessary, just, fair, or affordable.

          Reply

          • Posted by S Moderation Douglas on June 30, 2015 at 11:24 pm

            “Perhaps you have a short memory .”

            I have nothing at stake here. My pension, meager as it is, is probably as untouchable as they come. I’m just a knowledgeable taxpayer trying to cut through the BS.

          • Posted by Tough Love on June 30, 2015 at 11:36 pm

            Quoting S. Moderation Douglas …..”I’m just a knowledgeable taxpayer trying to cut through the BS.”

            Then start with yourself.

          • Posted by S Moderation Douglas on June 30, 2015 at 11:43 pm

            And I appreciate fouls123 for doing the same.

            Good job, fouls.

  9. Posted by fouls123 on June 30, 2015 at 6:45 pm

    FYI the state contributions for health benefits are available online at nj.gov/treasury. go to government then click on treasury and find under the health benefits. The state contributes biweekly. for a single person it varies by chosen insurer but it is roughly # 65oo a year. For families it is roughly $ 13,000. This comes directly from the state’s own site. Obviously Christie is lying about the cost as usual. If anyone does not believe it, look it up. There is a breakdown of the cost to the state for each insurers plans listed. some are slightly higher and others slightly lower, but average about the amounts I stated. There are no plans exceeding 19,000.and each employee pays at least 1.5% of their salary or10% of premium whichever is greater. which reduces the above amounts that the state actually pays. The highest premiums is about $19000 for family but reduced by employee contribution in that case of $1900, so the state would pay about $ 17100 at most.

    Reply

    • Posted by Tough Love on June 30, 2015 at 8:07 pm

      Bigtime BS………….. as usual.

      http://www.state.nj.us/treasury/pensions/hb_open_enrollment_2014/state-retired-full.pdf

      Look at the NJ State Retiree Family Plan costs for those not on Medicare. Many are over $2500 monthly ($30,000 annually), and top out at $2,848.68 monthly ($34184.16 annually).

      And the LOCAL Plan costs are even HIGHER;

      http://www.state.nj.us/treasury/pensions/hb_open_enrollment_2014/local-gov-retired-full.pdf

      With almost ALL of the Plans offered (for NJ Local Retiree Family Plan costs for those not on Medicare) over $30,000, several over $35,000, and topping out at $3,044.83 monthly ($36,537.96 annually).
      ——————————————

      Reply

      • Posted by S Moderation Douglas on June 30, 2015 at 9:29 pm

        Oh, grow up.

        Gov Christie very clearly told that teacher (and this isn’t the first time he’s said this) that she gets a $26,000 subsidy (that’s the alleged $31,500 minus the employee share.) Every year.

        Not just when she’s a “family plan not on Medicare,” but today, while she is working, and every year hence. Fouls just gave you the damn answer, right from the horses mouth. Decidedly not “Bigtime BS………” She’s getting maybe $17,000. That’s ……if……. she has a family. If she is unmarried, perhaps as low as $6,500. No way on God’s Green Earth you can torture a $26,000 “average” out of those numbers.

        Until the day you die. ……If……..$30,000 + is for a family plan not on Medicare, what happens when you do go on Medicare? You ain’t dead yet, but the state will no longer be paying $30,000 +.

        Face it. CC lied. Serially. And TL has got his back.

        Reply

        • Posted by Tough Love on June 30, 2015 at 9:39 pm

          I presented (with linked pages) a set of factual NJ Public Sector Retiree healthcare premiums…. from NJ’s OWN websites. If you want to refute these …OUTRAGEOUSLY HIGH PREMIUMS (so set because the Plan provisions are so ridiculously generous…. as I summarized in my earlier comment), go right ahead.

          I made no comment or reference here to what Christie stated … YOU did, so you are arguing with yourself …. and as usual trying to divert attention from the OUTRAGEOUSLY GENEROUS and hence VERY VERY COSTLY healthcare coverage it grants NJ Public Sector retirees …… and of course provide support to commentator fouls123 who is clearly clueless.

          Reply

          • Posted by Tough Love on June 30, 2015 at 10:26 pm

            And for what it worth (accurate ???), fouls123 stated …….. “The highest premiums is about $19,000 for family but reduced by employee contribution in that case of $1,900, so the state would pay about $ 17,100 at most.”

            So for the MOST expensive FAMILY option, the “employee” share of the $19,000 total annual premium is 10% or $1,900 annually, or $158.33 monthly.

            Please tell me which Private Sector worker pays anywhere near such a LOW premium for such generous coverage. It’s a rare Private Sector worker whose cost-share is less than DOUBLE that % or $ amount, with most even higher.

            ——————————

            Just one MORE of the MANY examples of Public Sector workers/retirees unnecessarily, unjustly, unfairly, “TAKING” WAY too much from the Private Sector.

  10. Posted by fouls123 on June 30, 2015 at 9:59 pm

    My healthcare numbers are for current employees TL. I clearly said employees, not retirees. and Christie was not talking about retirees either. Iwill look at the retirees and respond.

    Reply

  11. Posted by fouls123 on June 30, 2015 at 10:19 pm

    TL, what I stated was not BS, it was the numbers for current employees as I stated above and is correct.. As far as your statement about retiree costs you are correct, but if left at that, it is somewhat misleading as there are few retirees who have children young enough to qualify living at home. Most are retiree and spouse on medicare in the $1400 per month range, single in the$1000 range and on medicare with spouse which is even less. Granted these costs are very high. A federal switch to single payer healthcare would save the state much of the cost for employees and some of the cost for those not yet on medicare.

    Reply

    • Posted by Tough Love on June 30, 2015 at 10:27 pm

      Read my last above comment………………

      Reply

    • Posted by Tough Love on June 30, 2015 at 10:28 pm

      Quoting ….”there are few retirees who have children young enough to qualify living at home.”

      I’d guess that OVER 50% of newly retires Police Officers have minor children living at home.

      Reply

  12. Posted by fouls123 on June 30, 2015 at 10:26 pm

    I wonder what TL will say if or when her employer decides to take away some of her promised benefits after she retires? If the state can do it you better believe private companies will follow suit. Supporting broken promises to one group only helps to promote attacks on other employees everywhere. divide and conquer until there won’t be anyone strong enough to stand up to society’s bullies.

    Reply

    • Posted by Tough Love on June 30, 2015 at 10:32 pm

      When ??? Will Follow Suit ????

      What rock have you been living under?

      Most (non-Union) Private Sector employers (and many Union as well) have ALREADY ended retiree healthcare coverage.

      Reply

      • Posted by Tough Love on June 30, 2015 at 10:42 pm

        Follow-up ……

        “As a result of these changes, fewer than one in five workers today are employed by firms offering retiree health benefits.”

        Source (at the end of the 1-st paragraph) …http://kff.org/report-section/retiree-health-benefits-at-the-crossroads-overview-of-health-benefits-for-pre-65-and-medicare-eligible-retirees/
        _______________________________

        What would you estimate that % to be for Public Sector workers ….. perhaps 90+% ?

        Reply

        • Posted by summerphan on June 30, 2015 at 11:45 pm

          I think your comments prove fouls123’s point of divide and conquer. instead of arguing for increased benefits for private sector you argue to bring everyone down rather than everybody up. this attitude is what has caused many workers today to have to lost benefits, salary, vacation time and pensions that they probably deserved but no longer get. congratulations for falling for the line that everyone deserves nothing. I notice that you never let us know what your income and benefits are you only talk about the private sector in general. You are probably among the elite private sector who have high income and benefits themselves but have no problem denying that to others. and if that is not the case please elaborate on your own personal private sector circumstances.

          Reply

          • Posted by Tough Love on July 1, 2015 at 12:15 am

            Quoting …”instead of arguing for increased benefits for private sector you argue to bring everyone down rather than everybody up.”

            What nonsense …………

            I’m guessing that you work in the Public Sector bubble-world where the “workers” can tell their bosses what to do what they are “GOING TO” give them*. Unlike Public Sector workers, Private Sector workers are mostly “at will” employees …. you take it or leave it (quit and work elsewhere).

            And heck, why should the bosses protest giving away RICH pay, pensions, and benefits. As “bosses” THEY will get get AT LEAST as much, and likely MORE …. and FORCE the Taxpayers to pay for it.
            ————————————————————–

            It doesn’t work like that in the PRIVATE Sector, never has, doesn’t now, and never will.

  13. Posted by Eric on June 30, 2015 at 10:44 pm

    John:
    As the Appellate Division discussed in its published opinion in the cost of living adjustment case, which is now pending before the NJ Supreme Court, post-retirement health care benefits are not afforded the protection of the non-forfeitable right statute unlike pensions and their corresponding cost of living adjustments. See NJ Statutes Annotated. I do not have the cite handy. That was the easy part. It was simple.
    Perhaps, as you stated, Washington will enact some kind of universal health care coverage, knowing that almost all states are having extreme difficulty in covering pensions and cannot simultaneously cover health care benefits as well. This is the hard part since it involves “Big Pharma” and Congressional corruption.
    Chicago dumped its retirees onto the Obamacare exchanges and still cannot pay its pensions, and thus had its bonds downgraded to junk status. Newark, NJ also has its bonds downgraded to junk and Paterson NJ bonds are no longer of investment grade.
    Eric

    Reply

  14. Posted by Anonymous on June 30, 2015 at 11:47 pm

    We love you Governor
    Oh yes we do
    You’re a lying scumbag
    Through and through
    When you’re not in NJ
    We’re blue
    Oh Governor
    We hate you

    The WE being the 70% plus who disapprove of this opportunistic bombastic SOB.

    I got the protective gear on and ready for the bashing but you know what if he’s gonna dish it out then he’s got take it.

    Reply

  15. Posted by summerphan on July 1, 2015 at 1:04 am

    to TL above
    once again you prove the point by pitting public sector workers verse private sector workers. and you generalize again not stating about you or your personal situation. if indeed you believe private sector workers can take it or leave it maybe private workers need to ban together like they used to so that their “bosses” have to negotiate with them for the benefits that they so richly deserve and don’t get according to you. And you know there are private sector work places where they do this and they are called unionized companies and they still exist. But of course if you had your way with your philosophy they wouldn’t exist. thankfully in years passed workers did ban together and fight to have such things as 40 hour work weeks and other benefits. so you think workers should be in a take it or leave it situation all the time is that your ideal?

    Reply

    • Posted by Tough Love on July 1, 2015 at 2:35 am

      Nonsense, as I said (accurately) above … “Unlike Public Sector workers, Private Sector workers are mostly “at will” employees …. you take it or leave it (quit and work elsewhere).”

      This has NOTHING to do with “pitting public sector workers verse private sector workers”

      And quoting ,,,, ” if indeed you believe private sector workers can take it or leave it maybe private workers need to ban together like they used to so that their “bosses” have to negotiate with them for the benefits that they so richly deserve and don’t get according to you.”

      They’ve been trying to do that at Walmart for 2 decades and have gotten nowhere. And in the hundreds of thousands of white collar offices, there are no Unions. While well paid, the Bosses call the shots, NEVER the workers.

      Reply

  16. Posted by Anonymous on July 1, 2015 at 9:35 am

    http://www.nj.com/politics/index.ssf/2015/06/christies_finance_team_includes_big_nj_contractors.html#incart_river_mobileshort

    PRIVATE playing that “PAY to PLAY” game AGAIN, yeah that’s right at the expense of the TAXPAYERS!

    Reply

    • Posted by Tough Love on July 1, 2015 at 11:24 am

      Same old …..

      “Chump-change” compared to just the UNJUST and EXCESSIVE SHARE of Public Sector pensions and benefits that our Democratic Legislators (whose favorable votes on pensions & benefits are BOUGHT with Public Sector Union Campaign contributions and election support) have granted Public Sector workers.

      Reply

      • Posted by Anonymous on July 1, 2015 at 1:53 pm

        Yup AGREED your stuff is the same old same old. Conversation taking place on current post, see you there.

        Reply

  17. Posted by fouls123 on July 1, 2015 at 2:13 pm

    TL is it your position that the bosses should have all the power to decide your pay and benefits? The problem with places like Walmart is that they have become a virtual monopoly and probably should be forced to break up just like the oil and telephone companies were. If the majority of Americans would support unions the way they did in the 20th century before Reagan and the Republicans and corporations went on their union busting binge, most workers would see a living wage again. if private sector workers in general are not doing as well I would certainly support paying a little more for goods and services if it would improve the wages for them. Larger companies and corporations have been bleeding their employees and have become greedy since the eighties. I support defined benefit plans for all employees as existed throughout most of industries in the past when CEOs didn’t feel entitled to be paid several million a year. The middle class is disappearing and will continue the downward spiral as long as people like you advocate for benefit reductions for sectors of the middle class in stead of trying to bring up the benefits of all middle class workers. There are no million a year public workers, but there are many million a year private workers. And what they earn impacts you and what is left of the earnings pie just as much as what you pay in taxes. you want to talk about greed. Talk about that greed. Raising taxes on those people would reduce your tax burden if you are only middle class like all public workers are. I would support a maximum wage as well as a higher minimum wage for all. And I would support salary and benefit reductions for public sector people who earn over $200,000. and I don’t think anyone needs more than 500, 000 a year in income because it is at the expense of everyone else. and that includes athletes, CEOs and movie stars ( all by the way private sector) And part of you tax money in this state goes for sports stadiums that cost over a billion dollars. so we are subsidizing millionaire athletes and billionaire owners. where is your outcry over their greed that is costing you the taxpayer? What kind of pension and benefits will you be receiving? Oh, that’s right you refuse to tell us if you will have better pension and benefits yourself while calling public workers greedy. Are you embarrassed because you are far greedier or are you embarrassed that you won’t be doing as well and are jealous? which is it? You know what my pension is, I already told you, so you know I am not getting rich. I have received a fair pension and benefits. And that’s all. If you had worked over 32 years in my job in a prison I am sure you would feel likewise.

    Reply

  18. Posted by S Moderation Douglas on July 2, 2015 at 3:24 pm

    According to you know who*, New Jersey state employee healthcare costs seem to be below average compared to other states for current workers, and the value of accruing retiree health benefits, while higher than average, is far from being among the highest of the states.

    *( AEI, the 23%, 34% crew, take all these numbers with a grain.)

    Reply

    • Posted by Tough Love on July 2, 2015 at 9:36 pm

      It is FAR more appropriate to judge the reasonableness of NJ State and Local employees’ pensions & benefits by comparison with those of similarly situated Private Sector Taxpayers (being called upon to pay for them)…… NOT OTHER equally over-pensioned and over-benefited “PUBLIC” Sector workers.

      Reply

      • Posted by S Moderation Douglas on July 3, 2015 at 3:45 pm

        Da point is, one study says NJ has some of the highest healthcare costs in the nation; and another says it’s about average. Who does one believe?

        Moderation, and common sense, says take it all with a grain of salt.

        Reply

        • Posted by Tough Love on July 3, 2015 at 5:40 pm

          I needn’t choose with BOTH comparing to what a reasonable person would agree are the WRONG reference groups.

          With Private Sector Taxpayers footing most (and in some cases, the entire cost) the healthcare subsidies provided Public Sector workers should rightfully be compared to the healthcare subsidies that Private Sector employers provide THEIR workers…. NOT to what other over-benefitted “PUBLIC” Sector workers get.

          It’s not difficult to understand …. just concentrate, and for a brief moment pu aside your HUGE Public-Sector bias.

          Reply

        • Posted by Tough Love on July 3, 2015 at 11:37 pm

          No, more likely you know I’m right….. and you HAVE no “reasonable” reply.

          Reply

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