Christie Vetoes Pension Bills For Quarterly Payments and $300 Million “Pre-Payment”

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New Jersey Gov. Chris Christie on Monday vetoed two pension-related bills that had been passed recently by the Democrat-controlled state legislature.

The first bill (S3100) would have forced the state to make its pension contributions on a quarterly basis, as opposed to an annual basis.

The second bill (S3107) would have mandated the state make a $300 million “pre-payment” on next fiscal year’s pension contribution; the money would have come from an unexpected influx in tax revenue.

NJ.com explains Christie’s objections to the measures:

The first bill (S3100) sought to set a schedule for pension payments during the year, which Democrats said would provide more certainty to Wall Street that payments were being made and would better maximize investment earnings.

The change also would make it harder for Christie to make last-minute cuts to balance the budget.

“This bill represents an improper and unwarranted intrusion upon the longstanding executive prerogative to determine the appropriate timing of State payments in order to match properly the timing of large annual expenditures with the timing of the actual receipt of state revenues,” the governor wrote.

He added,”Enacting new laws to compel specific payments on specific dates does nothing at all to repair or reform the fundamentally unsustainable pension and health benefits systems currently in place.”

[…]

The governor also vetoed as “accounting gimmickry” a bill (S3107) to make a supplemental payment of $300 million into the pension system as part of the fiscal year that ended June 30, saying the money did not exist in the budget.

“This bill proves that even the massive tax increases embedded in the Legislature’s proposed FY 2016 budget were insufficient to support the pension contribution it pretended to make,” Christie said in his veto message.

He also said there was no additional $300 million in the budget to spend on the payment, and that the Legislature was spending money “that doesn’t exist.”

“Instead of accounting gimmickry, the legislative majority should embrace reality and join with my Administration in a realistic discussion of necessary reforms to the pension and health benefits systems,” Christie said.

Christie has spent the last year pushing for pension reform via benefit cuts; meanwhile, the Democrat-controlled legislature has consistently argued for a more consistent payment schedule, arguing that state payments are the key to better pension funding.

 

Photo By Walter Burns [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons

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