Where Are Their Members’ Pensions?

Where are their clients’ yachts?

William R. Travers

This was to be a followup to the Think Tank blog checking out 990 and 5500 information on public worker unions in New Jersey to see what type of plans these union people had for themselves. I still may put together that spreadsheet but, as it turned out, the first union I looked at made the point.

The New Jersey Education Association (NJEA), according to their latest available 990 filing, takes in $130 million annually – $115 million from union dues which according to a 2012 article breaks down this way:

The highest dues is $791 for full-time professional staff, including teachers and administrators. More than 60 percent of the union’s roughly 195,000 members pay the maximum amount, while other members pay lesser amounts, according to NJEA spokesman Steve Wollmer.

Wollmer told us 2,041 employees are paying a representation fee in lieu of joining the union. The union conducts an annual audit to determine the expenses chargeable to nonmembers, and the current fee stands at 81.8 percent of NJEA dues, Wollmer said in an e-mail.

So, a full-time teacher who has decided against joining the teachers union must still pay $647 in the current school year to the NJEA.

“The reasoning is that everyone benefits from the terms of the collective bargaining agreement, which includes salaries and benefits among other things,” Wollmer said. “The statute spells out what items are ‘chargeable’ – or needed to negotiate, enforce, and adjudicate legal disputes around the contract – and those charges cannot exceed 85% of NJEA dues.”

Now about those benefits. The Teachers Pension and Annuity Fund (TPAF) is the second worst funded plan (after the much smaller Judicial Retirement System) in the state with the worst funded pension system even after cost-of-living-adjustments for all retirees were eliminated arbitrarily. The ugly official numbers:


But it is a different story when we look at how the NJEA is benefiting their own employees – starting with compensation at the top:


According to the 990 instructions that Other Compensation column (F) amount could be:

compensation other than reportable compensation, including deferred compensation not currently reportable on Form W-2, box 1 or 5 or Form 1099-MISC, box 7, and certain nontaxable benefits, as discussed in detail in the instructions for Schedule J, (Form 990), Part II. See the instructions for other compensation reported in column (F), later, which includes a table to show where and how to report certain types of compensation in Part VII, Section A, and Schedule J (Form 990).

More detail from Schedule J:


My guess is that the Deferred Compensation column (C) includes the value of benefit accruals under the Defined Benefit Plan and contributions under the 401(k) Plan that the NJEA maintains for its employees.

The NJEA Defined Benefit plan happens to be very well funded:


with benefits better than the TPAF plan with its 1/55 top accrual:


and cost-of-living-adjustments intact:



14 responses to this post.

  1. Posted by Anonymous on December 28, 2016 at 5:18 pm

    The NJEA doesn’t administer educators pensions that is handled by the Division of Pensions and Benefit, for Higher Ed it’s contracted pension providers, so the members don’t care about the union officials defined benefit pensions. The problem is the State of NJ mishandling of the five public pension plans.


  2. Posted by Anonymous on December 28, 2016 at 7:39 pm

    I think think the point is closer to the fact that the NJEA takes better care of itself than its’ members!


    • Posted by dentss dunnigan on December 29, 2016 at 8:40 am

      But” it’s for the kids” …..remember


    • Posted by Anonymous on December 29, 2016 at 8:49 am

      The State as the employer contributor should place both the employee and employer contributions in the pension funds biweekly like the payroll system.


      • Posted by S Moderation Douglas on December 29, 2016 at 6:20 pm

        Yes, and they should pay the actuarially correct amount.

        I wonder if some states/local governments do this already?

        (The biweekly part. I know they don’t put in enough, just about everywhere.)


  3. Posted by Anonymous on December 28, 2016 at 7:40 pm

    Over promised, under funded, injustice for all!


  4. Posted by Anonymous on December 29, 2016 at 9:35 am

    Any proof it’s related to 9/11? Who cares right?

    No exceptions for retirees or surviving spouse and dependent children. Cuts those pensions and health benefits.

    And just wait until the momentum carries the movement to all Federal DBPs. I know it’s like Christie said during his first campaign for governor to the PBA et al and NJEA, your pension and health benefits are safe with me.



  5. Posted by Anonymous on December 29, 2016 at 10:28 am

    The federal government insures certain pension benefits. Specifically, it insures defined benefit plans (but not other types of retirement plans) through the Pension Benefit Guaranty Corporation (PBGC), a federal agency created by ERISA.

    So what happens when the Tea Party Republicans decide to not fund the pensions, well maybe we’ll see?


    • Posted by PS Drone on December 29, 2016 at 4:11 pm

      I do not think PBGC coverage applies to public sector pension plans. In fact, I don;t think most of ERISA applies to public sector plans. Unless the Federal government prints more worthless fiat currency to underwrite all of these under funded plans (across the country) the sad fact is when plan assets are gone the jig is up.


    • Posted by Anonymous on December 29, 2016 at 5:10 pm

      The Republicans will be busy fighting the 14 countries that sit on the UN security council, funding Bibi’s defense fund for charges of fraud and bribery( the German-based company is Iranian owned). Singing James Brown’s “Big Payback” based on Obama’s retaliation for Russia’s cyber attack, can’t wait for the pictures of Transition Team members leaving the Russian compounds in New York and Maryland, the Republicans will have to choose sides democracy or Putin. The Russian diplomats don’t have to go home but they’ve got to get the hell out of America. The Republicans priorities are being determined by international activities.


  6. […] but also defined contribution plans, typically 401(K) plans, which John Bury describes as “very well funded.”  (An Economic and Fiscal Policy Review Committee headed by Senate President Steve Sweeney […]


  7. […] taxpayer $65,100.  (By the way, NJEA executives don’t participate in TPAF– they have their own well-funded pension system, which includes 401K’s ). Yet, as  Mike Lilley notes, NJEA leaders  — free from a broken […]


  8. […] NJ taxpayer $65,100.  (By the way, NJEA executives don’t participate in TPAF– they have their own well-funded pension system, which includes 401K’s ). Yet, as  Mike Lilley notes, NJEA leaders  — free from a broken […]


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