The New Jersey Senate budget committee today approved a plan to ask voters in 2016 to decide a constitutional amendment guaranteeing that the annual contributions to public workers’ pension funds (as ludicrously understated by compromised actuaries and further arbitrarily sliced by the legislature) will somehow be made and Senate president Steve Sweeney took to the microphone:
Christie said that the Illinois state government is gridlocked and has no budget because its constitution requires pension payments. The state’s economy is suffering as a result. But Sweeney said a constitutional amendment is needed because Christie didn’t make the contributions to the pensions seemingly required under pension reforms adopted in 2010 and 2011.
“You didn’t live up to your first commitment,” Sweeney said. “… How many people said, ‘I promise you I’ll do it’? We did it in ’11 and trumpeted $121 billion in savings. And with that, where are we at now? The only way to do it is to put it in the constitution and mandate that it does get funded.”
Union officials who testified at the Senate committee hearing said the constitutional amendment is the only option left.
Actuaries say the state’s pension funds have a deficit exceeding $40 billion. Under a separate accounting standard the state follows for bond disclosures, not for calculating its pension payments, the unfunded liability is $83 billion.
After the vote, Christie’s office said the governor’s plan comes from independent experts “not in the pocket of the public sector unions” and “does not rely on the massive tax increases and fairy dust that are central to the Senate president’s plan.”
There are two routes for the Legislature to use to put a constitutional amendment before voters. Because Republicans appear likely to oppose the pension funding proposal, the ballot question would have to be approved by a simple majority of both the full Senate and full Assembly by Jan. 12, then again before early August, in order to be on the November 2016 ballot.
Constitutional amendments are put on the ballot without the involvement of a governor, so Christie would have no formal role.
Democrats who control both houses don’t need Republican support to put the question on the ballot. Gov. Chris Christie also has no say in referendums.
“If the bill before you today is passed and approved by the voters of the state, the pension mess that we are in today will slowly but surely be healed,” Eric Richard, legislative affairs coordinator for the New Jersey AFL-CIO told the Senate panel. “This constitutional amendment is in essence a do-over, an opportunity to go back to the 2011 reform law and say we are now going to uphold our end of the bargain.”
Sweeney said he was confident that New Jersey’s economic expansion will give the state the money it needs.