Breaking News: S5 Passes

Easily on paper (but behind the scenes).

S5 ScaSa (2R) Transfers management of PFRS to Board of Trustees of PFRS.
Passed both Houses

Identical Bill Number: A3671
Last Session Bill Number: S3040   (1R) A99 Sweeney, Stephen M.   as Primary Sponsor
Kean, Thomas H., Jr.   as Primary Sponsor
Bucco, Anthony R.   as Co-Sponsor
Oroho, Steven V.   as Co-Sponsor
1/9/2018 Introduced in the Senate, Referred to Senate State Government, Wagering, Tourism & Historic Preservation Committee
2/1/2018 Reported from Senate Committee with Amendments, 2nd Reading
2/1/2018 Referred to Senate Budget and Appropriations Committee
2/5/2018 Reported from Senate Committee, 2nd Reading
3/26/2018 Senate Amendment (33-1) (Sweeney)
3/26/2018 Emergency Resolution (34-2) (Kean)
3/26/2018 Passed by the Senate (34-2)
3/26/2018 Received in the Assembly without Reference, 2nd Reading
3/26/2018 Substituted for A3671
3/26/2018 Motion To Aa (Thomson)
3/26/2018 Motion To Table (Sumter) (49-21-0)
3/26/2018 Passed Assembly (Passed Both Houses) (67-2-7)Introduced – – 51 pages PDF Format    HTML Format
Statement – SSG 2/1/18 – 4 pages PDF Format    HTML Format
Reprint – – 50 pages PDF Format    HTML Format
Statement – SBA 2/5/18 1R – 3 pages PDF Format    HTML Format
Fiscal Estimate – 2/22/18; 1R – 5 pages PDF Format    HTML Format
Committee Voting:
SSG  2/1/2018  –  r/Sca  –  Yes {5}  No {0}  Not Voting {0}  Abstains {0}  –  Roll Call
SBA  2/5/2018  –  r/favorably  –  Yes {11}  No {1}  Not Voting {1}  Abstains {0}  –  Roll CallSession Voting:
Sen.    3/26/2018  –  2ND READING   –  Yes {0}  No {0}  Not Voting {40}    –  Voice Vote Passed
Sen.    3/26/2018  –  AMEND   –  Yes {33}  No {1}  Not Voting {6}    –  Roll Call
Sen.    3/26/2018  –  EMERGENCY   –  Yes {34}  No {2}  Not Voting {4}    –  Roll Call
Sen.    3/26/2018  –  3RDG FINAL PASSAGE   –  Yes {34}  No {2}  Not Voting {4}    –  Roll Call
Asm.  3/26/2018  –  MOTION TAB MOTION   –  Yes {50}  No {21}  Not Voting {8}  Abstains {0}  –  Roll Call
Asm.  3/26/2018  –  3RDG FINAL PASSAGE   –  Yes {67}  No {2}  Not Voting {3}  Abstains {7}  –  Roll Call

26 responses to this post.

  1. Posted by Anonymous on March 26, 2018 at 4:15 pm

    S John please explain this in layman’s terms what exactly do they have control over


  2. Posted by Kevin on March 26, 2018 at 5:35 pm

    Lets see, Board of Trustees, first travel expenses, then food and finally “we should be paid,” will all this come out of our pension funds?


  3. Posted by boscoe on March 26, 2018 at 6:22 pm

    Noticed that there was a floor amendment today in Senate before final vote. Amendment sponsored by Sweeney. Text not available yet. [Sen. 3/26/2018 – AMEND – Yes {33} No {1} Not Voting {6} – Roll Call]


  4. Posted by Tough Love on March 27, 2018 at 11:23 am


    I don’t recall this being addressed before …..

    Will the transfer of the PFRS Plan to the new structure end the grade-in of calculated ARC employer contributions ?

    If not, does the new Trustee Board have the authority to change that grade-in pattern (or to refuse to go along with a new grade-in pattern that may take place in future years) for the PFRS Plan?


  5. Posted by Tough Love on March 27, 2018 at 4:16 pm

    “Congress didn’t give Trump the money he wants for his border wall, so now he reportedly wants the military to build it”

    Trump is sounding more and more like a “dictator” every day.

    What’s next ?


    • Posted by Stanley on March 27, 2018 at 6:13 pm

      “Trump is sounding more and more like a “dictator” every day.”
      The wall isn’t my issue, but it was Trump’s issue. The wall issue put Trump into the White House more than any other issue. No wall issue and we would be lamenting President Hillary. I would prefer spending $50B on the wall rather than spending $50B “rescuing” recreational drug users.
      The wall got Trump elected and if walks away from it he becomes just another lying, hustling politician.


  6. Posted by MJ on March 27, 2018 at 5:01 pm

    John how will this affect the other state pensions, teachers pensions, etc if PFRS pulls out?


    • 1) An honest valuation of assets (which presumably the state will do with an eye to understate numbers so they keep transfer amount down) could cause a rightsizing of values in the whole plan that would normally cause higher contributions though actuaries could keep ‘smoothing’ assets to paper this over.

      2) When JRS runs out of money in 2021 it will presumably be tough for the state to get money from PFRS to cover a part of the payouts so it will be the other plans who will be subsidizing the judges in 2021 and the teachers a few years later.


      • Posted by Tough Love on March 27, 2018 at 5:37 pm

        Before Gov Murphy approves the S5 passage, he should keep your point #2) wrt the Teacher’s Plan in mind. He’s going to need the PFRS assets to share the pain in propping up the Teacher’s Plan once runs out of assets.


        • Posted by El gaupo on March 27, 2018 at 6:57 pm

          Which is why we want the state’s grubby little paws off it. Towns have paid their fair share. Pfrs should NOT be available to bail out over pension plans.


          • Posted by Tough Love on March 27, 2018 at 7:49 pm

            Oh don’t stop there, if PFRS won’t contribute to the Teacher’s Plan WHEN (not IF) it goes belly-up, then please choose which one of the these options you prefer:

            (1) Make the PERS Plan participants pick up the ENTIRE Teacher’s Plan bailout costs
            (2) Let the Teachers suck wind ….. (their problem)


          • Posted by Tough Love on March 27, 2018 at 7:54 pm

            Just wait until the State portion of the PFRS Plan needs money from the LOCAL portion, and the Locals say no way ………… gunfight at the OK Coral.

            But we’re “brothers” !


    • Posted by El gaupo on March 27, 2018 at 8:17 pm

      No sympathy here TL. Unfortunately, the taxpayers will have to pay to prosecute these mopes. If guilty they should have to reimburse the state or serve time in jail (or both) and of course be fired.
      Yes. Pfrs funds are commingled. And while the state shortchanges those guys(mostly CO’s) the number of participants is relatively small. The problem is when the state shortchanges them, the valuation of the plan goes down requiring the towns to kick in more money the next year and so forth.
      I would also wager that teachers pensions will never be paid out of PFRS funds. They will be cut in combination with raised taxes. At some point, I think the state will do something stupid like sell the GSP/turnpike etc. to help the funds. I will Long be retired before any of that happens. Pfrs drop dead is in the 2050s


      • Posted by Tough Love on March 27, 2018 at 9:31 pm

        El gaupo,

        Does your term “mopes” equally apply to the 2 Firefighters who have already pleaded guilty (see the end of the article) ?

        Not sure where you’re getting the PFRS “drop dead” year in the 2050s, but I bet it’s DEPENDENT on the Plan’s “official” investment return assumption of 7.5% per year return forever.

        By the way that’s 7.5% on the Plan’s LIABILITY (not it ASSETS), and with a LOCAL Plan Funding ratio likely no greater than 60% (once the share of all assets …… a large portion of which are not liquid and likely WAY overvalued … are split off to the PFRS), that means to maintain that “drop dead date” in the 205os you’d need an annual return on assets of 7.5%/0.6 = 12.5% …… EVERY YEAR.

        If you believe that …….. I’ve got a bridge to sell ya.


      • Posted by Tough Love on March 28, 2018 at 2:28 pm

        El Gaupo,

        Update on your Plan’s “drop dead” date, and from none other than pension-blogging Actuary Mary Pat Campbell. Her best estimate is 2032.

        I suggest you start working on a “Plan B”


        • Posted by Stephen Douglas on April 6, 2018 at 5:12 pm

          In the real world, “drop dead” is just a trope.

          Sorry, there won’t be any 50% reductions. Older retirees and those with lower pensions will probably be spared.

          Think Detroit, not Loyalton. Not a haircut, just a little off the top.


  7. Posted by boscoe on March 28, 2018 at 3:16 pm

    Final version of S5 now requires 8 votes to reinstate COLA, instead of 7. Plus other changes. See Senate statement:

    Click to access 5_S3.PDF


  8. […] unions in New Jersey are fully expecting to be able to run their own pension plan after the legislature overwhelmingly approved the transfer. But will Governor Phil Murphy keep his promise to sign that […]


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