How a Benefits Bill Becomes Law in New Jersey

What started as a housekeeping bill to correct a perceived inequity:

was amended to result in unintended (?) consequences.

The first thing you need to know is that under current law, New Jersey state troopers who achieve 25 years of service have to pay up to 35 percent of their health care premiums in retirement. Here is the story on those who don’t get to 25 years.

According to their handbook the State Police Retirement System has this provision:

with these benefits:

You may notice that troopers are eligible for a pension equal to 50 percent of their final compensation after 20 years of service but don’t qualify for anything more (other than what comes from higher salaries) until they hit 25 years of service, when they are eligible for a 65 percent pension. That creates an incentive for troopers who know they won’t be able to achieve 25 years of service before the mandatory retirement age to leave the force after 20 years. The promise of free medical benefits in retirement was designed to prevent those officers from leaving the force early.

The arrangement was disrupted earlier this year when the state Treasury conducted an internal review and changed its interpretation of which troopers have to contribute to the cost of their health care coverage in retirement. “By law, [State Police Retirement System] retirees have been required to contribute to their health premiums since [Chapter 78] was enacted,” Treasury spokesman Willem Rijksen said last week in a statement, referring to the 2011 pension and health benefits reforms. “Following a routine internal periodic review, a couple dozen SPRS members were identified as not making the correct premium contribution.”  A few retired troopers previously excluded from paying toward their premiums subsequently got letters from the state telling them they would have to make contributions starting Nov. 1.

The legislation, S-3614, was originally written to apply to that small subset of retired state troopers who have more than 20 years of service but less than 25 years when they reach the state police’s mandatory retirement age of 55. Sen. Paul Sarlo, D-Wood-Ridge, said during a committee hearing on the bill this month that it was written with about 30 current retirees in mind.

But a version of the bill that has been passed by the Senate and approved by an Assembly committee reads as if it gives free health care coverage to many more retirees at greater cost to the state.

Possibly the most surprising aspect of this story is that OLS can’t put a number on the cost. It would seem pretty straightforward: whatever retired state troopers are paying now for medical benefits.