Pension ruling latest – Unions seek to appeal, GOP supports ruling

New Jersey's top court has sided with Gov. Chris Christie in a fight with public worker unions over pension funds. In the 5-2 ruling, the court said there wasn't an enforceable contract to force the full payment, as unions had argued.

Here's the latest developments.

3:30 p.m.

A statement from Assembly Republican Leader Jon Bramnick (R-Union, Morris and Somerset)  

“The Supreme Court decision was one of common sense. The Legislature and the governor can now begin to work on reforms to save the pension system. We must recognize the need to fix our system as stated in the findings of the bipartisan blue ribbon panel.”
Senate President Steve Sweeney's statement  

“I am deeply disappointed by this decision. The continued refusal by the administration to meet the state’s financial obligations does not make the problem go away, it only pushes it down the road and allows it to grow worse and cost more. Each dollar in deferred payment will cost three dollars in the future. The governor is exacerbating the problem.

“The real issue here is trust. How can we ask workers to come to the table when the governor will not honor his commitments?

“The Court recognizes the ‘staggering’ fiscal challenges that confront the state, but it believes it doesn’t have the authority to require the governor to make responsible choices. It allows the administration to continue the irresponsible budget practices that led to nine credit downgrades, financial instability and a weak economy.

“Nothing in this decision changes the responsibility of the state to meet its obligations. The Legislature will submit a responsible budget that makes the full pension payment without adding any burdens to middle class families or working people.

“The administration has failed to provide the leadership needed to meet the state’s priorities because it has lost its focus on New Jersey.”

3:00 p.m.

Baye Larsen, Vice President.Moody's Investors Service and lead analyst for the State of New Jersey

“The New Jersey Supreme Court has decided that pension contributions are not contractually protected. This decision has reduced the risk of sudden late-year liquidity and budget pressure, but perpetuates severe pension underfunding and rapid growth of state liabilities.

“In the near term, this decision stabilizes the state’s fiscal 2015 financial position because it eases the risk of a late-year liquidity and budget shock, and preserves the state’s expected budget flexibility for fiscal 2016. However, long term, this reinforces the state’s ongoing reliance on one-time budget solutions and will perpetuate large structural imbalances and a rapidly increasing pension burden.”

 2:45  p.m.

Statement from Assemblyman John S. Wisniewski (D-19)

“Today's Supreme Court ruling highlights a flaw in our state constitution that has enabled a dysfunctional budgeting process and is at the root of many of the fiscal challenges we face today. The ruling reinforces the short-term thinking that has encouraged legislatures and governors to ignore inconvenient obligations, such as pension payments, which can be left to a future legislature and governor and, in the process, grow into crises. It has left dedicated funds such as the Transportation Trust Fund ridden with debt because revenues that were meant to be self-sustaining for the long-term were spent for immediate political gains.

“If New Jersey wants to break the cycle of irresponsible budgets and chronic crises, we must change our constitution. Until then, we will be unable to engage in the long-term planning needed to develop a sustainable future.”

12:15 p.m.

A statement from Senate Republican Leader Tom Kean

“It is time to move forward. I will work to ensure that the state continues to make the largest responsible pension payment and to develop reforms to make the system solvent while protecting vital services, such as health and education, for all New Jerseyans.

“It is my expectation that all parties will now return to the table to negotiate a comprehensive solution to this issue.”

11:55 a.m.

Public employee unions are considering the next step after the New Jersey Supreme Court gave Gov. Chris Christie a major victory in a fight over pensions.

The court on Tuesday overturned a lower-court ruling that told the Republican governor and the Democrat-controlled Legislature to work out a way to increase pension contributions for the current fiscal year, which ends June 30.

In the 5-2 ruling, the court said there wasn't an enforceable contract to force the full payment, as unions had argued.

Christie called on lawmakers and unions to join him in solving pension problems "once and for all."

Union leader Hetty Rosenberg vowed to keep fighting for pension funding.

11:50 a.m.

Assembly Majority Leader Lou Greenwald

“The court’s decision clearly points out the obvious: New Jersey needs to get its financial affairs in order. The governor’s broken promises have dug the state into a deeper financial hole.

“We will continue to work to meet our obligations as we always have. We hope the governor will do the same.

“We made a promise to the unions to meet our obligation as they meet theirs. We will not waver from that promise.”

11:45 a.m.

A statement from NJEA President Wendell Steinhauer:

“Today’s Supreme Court ruling is a blow to the rule of law in New Jersey.

“It is devastating to all public employees, retirees, taxpayers, and families.

“The Court’s ruling that Gov. Christie is not bound by the laws that he signs and enforces on others is, in my view, indefensible.

“This ruling does nothing to resolve or reduce the state’s pension liabilities. In fact, it affirms our members’ non-forfeitable right to receive their pensions. But it also allows the current administration to push that obligation off onto future taxpayers, with interest.

“The only beneficiary of this ruling is Gov. Christie, who can continue to deceive New Jersey residents into believing that his budgets have been balanced. For anyone who will be in New Jersey after 2017, the cost of his deception will be staggering.

“This ruling has given the governor permission to kick the pension can down the road for the rest of his term. By doing that, the Court has now increased the state’s future pension liability and ensured that taxpayers will bear a much greater burden in years to come.

“The Court may have given the governor a pass on funding the pensions, but the state’s liability remains. Responsibility for the health of the pension systems and of the state’s future economy now rests solely with the Legislature, which must step up and act responsibly.

“Last year, the Legislature passed a responsible budget that put the state on a path to sustainable pension funding. Gov. Christie vetoed that budget, and too few Republican legislators had the courage to override his fiscally reckless action.

“This year, those legislators must decide whether they are still willing to burden their constituents with greater and greater debt each year simply to advance the political interests of a governor whose focus is no longer on New Jersey.

“The Court may have taken away the requirement for the governor to act responsibly, but it did not take away the right or the obligation of the Legislature to do so.

“We call on the entire Legislature to stand up for educators, other public employees, retirees and every New Jersey resident. They must do the job that the Court and the governor refuse to do. They must refuse to be bullied by the governor into further mortgaging New Jersey’s future.

“The Legislature must fund New Jersey’s pensions.”

11:15 a.m

Statement from Assembly Republican Budget Officer Declan O’Scanlon, R-Monmouth,

“Now is the time for teachers and public employee unions to come back to the table to work out an agreement with lawmakers and the governor that is fair for taxpayers and workers. While this decision is definitive, it doesn't really change much. It doesn't remove our obligation to resolve the problem in a way that is fair to both our public workers and taxpayers.

The governor has put a compelling and detailed plan on the table - designed by the bipartisan pension review commission,- and signaled a willingness to be flexible. The unions walked away from the discussions. There can be no excuse now not to come back. The only way to fix this long-term problem is for people to sit down, roll up their sleeves, and not walk away until we have a final plan.”

10:55 a.m.

Gov. Chris Christie says the state Supreme Court ruling that the state does not have to contribute a certain amount of money is an important victory for taxpayers and limited, constitutional government.

The governor says it is time to work together to find a long-term solution to make the state's pension system and employee health benefit costs affordable and sustainable.

Christie is in New Hampshire, where he attended a political event as he considers reunning for president.

Gov. Chris Christie's statement on the decision

“This decision is an important victory not only for our taxpayers who simply cannot afford these unsustainably high costs, but for limited, constitutional government that recognizes the proper role of the executive and legislative branches of government. The Court's position is clear, as is mine, it is time to move forward and work together to find a tangible, long-term solution to make our pension system and public employee health benefit costs affordable and sustainable for generations to come. In light of today's decision, I urge all interested parties to come back to the table and partner with me to finally solve this problem once and for all.”

10:45 a.m.

Reaction from New Jersey State Policemen’s Benevolent Association President Patrick Colligan

“Our law enforcement officers are out there every day working for our communities and continuing to make the payments required to make sure members and their families have a stable pension fund for their retirement. Today’s Supreme Court ruling is disappointing because it fails to make Governor Christie keep his promise to hard working law enforcement officers.

The fact is that our members agreed to pay an additional 1.5% directly from their paychecks to fund our pensions as a result of the Governor’s own highly touted pension law. While the Governor promised to use these funds to help secure our pension fund, he is now hiding behind the courts in an effort to continue syphoning these funds for his own political gain. This is not leadership. This is paramount to stealing from hard working law enforcement officers.

The New Jersey pension system is not one monolithic fund that is losing money daily. In fact, the State manages five pension plans for State and local employees. Of those five, PFRS is financed mainly by local governments, law enforcement officers and firefighters who have been making their required pension payments, even with the additional 1.5% required from Governor Christie’s own Chapter 78 legislation of 2011.

The PFRS system is stable at almost 77% and the only thing holding it back from operating at an almost 90% funding level is the governor’s broken promise.

Chapter 78 mandated both employer and employee sacrifices to provide funding to support the pension system. If it is only the employees who are required to make those sacrifices now under the Court's ruling, then I am hereby calling on the Legislature to immediately repeal Chapter 78 in its entirety. It is only fair that this broken bargain be taken off our backs if the Administration refuses to do what it promised so clearly in 2011."

10:30 a.m.

New Jersey Assembly Speaker Vincent Prieto says the New Jersey Supreme Court ruling on the public employee pension system changes nothing.

The Democrat says lawmakers always intended to fully fund the state's obligations. Prieto says Democrats will choose the path of responsibility.

The state Supreme Court on Tuesday overturned a lower-court judge's order that told the Republican Gov. Chris Christie and the Democrat-controlled Legislature to work out a way to increase pension contributions for the current fiscal year. That ends June 30.

In a 5-2 ruling, the court says there wasn't an enforceable contract to force the full payment.

The ruling came out after Christie spoke to reporters in New Hampshire, where he was attending a political event as he considers seeking the GOP nomination for president.

10:15 a.m.

The head of New Jersey's largest state workers' union says that public workers' pensions will be funded despite a ruling from the state Supreme Court that finds the state does not have to contribute a certain amount.

Hetty Rosenstein, the New Jersey president of Communication Workers of America, says union groups will look into whether they can appeal Tuesday's ruling.

If not, she said she would look into changing the state constitution or laws to make sure workers' pensions remain intact.

The state Supreme Court on Tuesday overturned a lower-court judge's order that told the Republican governor and the Democrat-controlled Legislature to work out a way to increase pension contributions for the current fiscal year. That ends June 30.

Rosenstein says they won't let the pension die.

10:05 a.m.

New Jersey's top court has sided with Gov. Chris Christie in a fight with public worker unions over pension funds.

The state Supreme Court on Tuesday overturned a lower-court judge's order that told the Republican governor and the Democrat-controlled Legislature to work out a way to increase pension contributions for the current fiscal year. That ends June 30.

In a 5-2 ruling, the court says there wasn't an enforceable contract to force the full payment.

One of Christie's signature achievements as governor has been a 2011 deal on pensions for public workers. Employees had to pay more and the government was locked into making up for years of skipped or reduced contributions.

Christie reduced the state's payment last year amid a surprise tax revenue shortfall.

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