Defined Cost-of-living-adjustments were always a part of a public retiree’s pension in New Jersey (holding a prominent place in the handbook-definition of the pension a retiree could expect) but now that the state pension will be going broke shortly COLAs are a target that the state’s lawyers are aiming at as they argue in the kick-off to their latest brief:
No one disputes that the retirees in these consolidated cases have a non-forfeitable right to their base pensions. The State reiterates that it is not walking away from this obligation and will continue to pay these benefits when due. These cases deal with the entirely distinct question of whether retirees have a non-forfeitable right to a cost-of- living adjustment (“COLA”) to those base pensions. They do not. Plaintiffs are demanding that the State keep a promise it never made.
They go on for scores of pages defending this position while raising some disturbing questions:
- “No one disputes the retirees have a non-forfeitable right to their base pensions” IN THIS CASE. But what about the next one as the State, out of necessity, seeks to redefine the term “base pension” again?
- If the State never promised to pay COLAs then why did they?
- Would the State be entitled to get back from retirees the $20 billion or so that has already been paid out in COLAs over the life of the plans?
New Jersey’s position is indefensible but lawyers paid to put up a defense will distract from the obvious and create enough doubts so a majority of the politican-appointed judges hearing this case can agree with them.