Union Leaders React to Christie Reform Proposals

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Last week, New Jersey Gov. Chris Christie unveiled a series of pension proposals that include freezing the current pension system for active employees and shifting them into a hybrid cash balance plan.

Throughout the week, union leaders publicly expressed their thoughts on the proposals.

Public safety unions weighed in, from NJ.com:

Patrick Colligan, president of the New Jersey State Policemen’s Benevolent Association, noted that as his union is funded by municipalities, it is in far better financial shape than those funds that have been shorted by the state through the years and his members should not face higher costs and lower benefits.

“To propose solutions to further reduce employee benefits essentially ignores the math of (Police and Firemen’s Retirement System),” Colligan said, adding that the plan “punishes nearly 40,000 law enforcement officers and firefighters who have no part to play in the state’s underfunded pension plans.

His derision was echoed by Edward Donnelly, president of the New Jersey Firefighters Mutual Benevolent Association.

“We have seen the results of Christie’s previous ‘reforms’, increased obligations to our members, while New Jersey taxpayer’s burden continues to be even greater,” said Donnelly. “Instead of more deceptive back-room deals, now is the time for us to stand together to bring about meaningful changes that save our pension system without further burdening taxpayers.”

Other unions officials spoke out, as well:

NJEA president Wendell Steinhauer claimed the teacher’s union was “deeply disappointed” that Christie “overstated the nature of the understanding” reached with the governor’s commission after months of talks.

“The pension plan’s long-term problem has always been the state refusing to put the money in,” said Hetty Rosenstein, New Jersey state director of the Communication Workers of America, “Now, here we go again.” The New Jersey chapter of the CWA represents some 40,000 state workers, as well as 15,000 county and municipal workers.

Read more about Christie’s pension proposals here.

Think Tank: New Jersey Pension Benefits Aren’t That Lucrative

New Jersey State House

One of the criticisms leveled at New Jersey and its underfunded pension system – and one of the main justifications used to cuts in worker benefits – is that New Jersey’s public employees receive more generous pension benefits than their peers in other states.

But a left-leaning think tank released a report Wednesday that cast doubt on the generosity of New Jersey’s pension benefits relative to other states.

From NJ.com:

New Jersey’s public employee pension plans ranked among the least generous of top public pension plans in the country, according to a report released today.

The study shows New Jersey’s pensions are more modest than 94 of the country’s 100 largest plans.


The study considered whether pension plans protect retirees from rising inflation, how benefits are calculated and how much employees contribute to their plans.

New Jersey fell in the bottom half in all three fields, which Stephen Herzenberg, the Executive Director of the Keystone Research Center, who authored the report, called the three most important dimensions of generosity.


Workers kick in 6.93 percent of their pay — and that number is rising — while employees contribute less in more than half of the other systems, according to the findings.

New Jersey’s retirees do not receive yearly cost-of-living adjustments to offset inflation, unlike 69 other plans included in the study that offer some protection from inflation. Retirees are suing to restore the cost-of-living increases that Gov. Chris Christie suspended as part of a 2011 pension reform package.

The state’s formula for calculating pension payments also uses a low multiplier — 1.67 percent ­— that lands it in the bottom quarter of plans.

The report notes that Garden State workers also receive some of the lowest pension benefits, but those were not factored into the rankings.

On average, pension benefits are $26,000 a year. Local government employees receive less on average, $16,000, while teachers receive more, $40,000. State employees collect $25,000.

Read the full think tank report here.


Photo: “New Jersey State House” by Marion Touvel. Licensed under Public domain via Wikimedia Commons