Meet the Nine People Tasked With Reforming New Jersey’s Pension System


When it comes to pension reform, this isn’t New Jersey Gov. Chris Christie’s first rodeo.

Christie signed his state’s initial pension overhaul back in 2010. A major part of the law was the requirement that New Jersey slowly work its way up to paying its full actuarially required contribution into the state pension system.

But that plan never came to fruition, as Christie is using a large portion of the state’s pension contributions this year and next to fill budget shortfalls elsewhere.

Now, Christie says he’s going to give pension reform another shot. Last week, he announced plans to create a panel to analyze the state’s pension system and brainstorm ideas for cutting costs. From the NJ Star-Ledger:

The Pension and Health Benefit Study Commission will review the history of New Jersey’s public retirement system, which has been neglected by governors of both parties since 1997, who did not make required contributions whenever they ran into budgeting difficulties. Christie’s special commission will also look at reforms implemented in other states and then recommend changes to the governor.

Although Christie has been on the town-hall circuit this summer speaking of the need to reduce current contributions for public workers, those benefits in some cases are protected by the state constitution – and could be hard to claw back.

Christie, however, may be able to reduce health benefits, which are not as strongly protected as pensions under New Jersey law. He could also try to increase pension contributions for future workers, and their retirement age, as he did in 2011. Still, a Democratic-controlled Legislature is unlikely to go along with those moves.

Today, he announced the people that will populate the panel. Here’s a breakdown of who they are:


big_picThomas J. Healey – Partner, Healey Development LLC

Mr. Healey joined Goldman, Sachs & Co. in 1985 to create the Real Estate Capital Markets Group, and founded the Pension Services Group in 1990. He became a Partner in 1988, a Managing Director in 1996, and remains a Senior Director of Goldman Sachs. Prior to joining Goldman Sachs, Mr. Healey served as Assistant Secretary of the U.S. Treasury for Domestic Finance under President Ronald Reagan.

He is Chairman of the Rockefeller Foundation Investment Committee and is actively involved with other charitable institutions. Mr. Healey graduated from Georgetown University in 1964 and Harvard Business School in 1966.

tom-byrne-colorTom ByrneFounder, Byrne Asset Management:

Tom founded Byrne Asset Management in 1998. He serves as the Managing Director and Head of Equity Portfolio Management and brings over 35 years experience in the securities industry to his clients.
Governor Chris Christie appointed Tom to the New Jersey State Investment Council. The Council oversees New Jersey’s public pension fund assets, currently about $73 billion. Tom also serves as a trustee and treasurer of The Fund for New Jersey and is a trustee of several other civic organizations. He also served two terms as Chairman of the Democratic State Committee in New Jersey.

Tom is a graduate of Princeton University (1976) and Fordham Law School (1981).

chambers-circleRay ChambersSpecial Envoy, United Nations:

Ray Chambers is a United Nations Special Envoy for Financing the Health Millennium Development Goals and For Malaria (United States). [He] is a philanthropist and humanitarian who has directed most of his efforts towards at-risk youth.

He is the founding Chairman of the Points of Light Foundation and co-founder, with Colin Powell, of America’s Promise — The Alliance for Youth. He also co-founded the National Mentoring Partnership and served as Chairman of The Millennium Promise Alliance.
Chambers is the founder and Co-Chairman of Malaria No More, with Peter Chernin, President of News Corporation. He is taking a leave of absence from that role to focus on his appointment as the United Nations Secretary-General’s Special Envoy for Malaria.

Leonard W. Davis – Chief Investment Officer, SCS Commodities Corp:

Mr. Davis has organized and managed private equity, technology, and natural resource companies.  He has been the principal financial manager in a private equity company and has been the Chief Financial Officer to the lead investor of a natural resource company active in metals and energy.

Mr. Davis received his B.S. in Accounting from Spring Garden College and is a Certified Public Accountant.

Carl Hess – Managing Director of Americas, Towers Watson:

Carl A. Hess (age 52) has served as Managing Director, The Americas, of Towers Watson since February 1, 2014, and has also served as the Managing Director of Towers Watson’s Investment business since January 1, 2010. Prior to that, he worked in a variety of roles over 20 years at Watson Wyatt, lastly as Global Practice Director of Watson Wyatt’s Investment business. Mr. Hess is a Fellow of the Society of Actuaries and the Conference of Consulting Actuaries, and a Chartered Enterprise Risk Analyst. He has a B.A. cum laude in logic and language from Yale University.

Ethan Kra – Founder, Ethan Kra Actuarial Services LLC:

Ethan Kra is an independent actuary, specializing in litigation support/expert witness, advice on multi-employer plan exposures and strategies and the financial aspects of executive benefits. Previously, he was a Senior Partner and Chief Actuary-Retirement of Mercer, where he consulted in the areas of the design and funding of pension and group insurance benefits, structuring and funding of non-qualified pension benefits and the proper accounting for expense of employee benefits.

He specializes in analyzing the economic and accounting implications of financing strategies and vehicles for employee and executive benefits. For over 17 years, he chaired Mercer’s Actuarial Resource Network, a committee of the senior technical actuaries throughout the United States.

Ken Kunzman – Partner, Connell Foley LLP

Kenneth F. Kunzman was Chairman of the Connell Foley Executive Committee from 1995 to 2002. He has been a partner in the firm since 1968 and has been responsible for a variety of areas of law.

Additionally, Mr. Kunzman serves as Chairman and Trustee of the Corella A. and Bertram F. Bonner Foundation of Princeton, NJ which provides scholarships for needy students of 26 colleges based upon community service. He is Trustee Emeritus of Caldwell College, former Trustee of St. Peter’s Prep, and Co-Chairman Emeritus of Seton Hall University Pirate Blue Fund. Mr. Kunzman served as Captain, US Air Force from 1962-1965.

Mr. Kunzman serves as a member of the Board of Trustees and the Executive Committee of the Scholarship Fund for Inner City Children and is the former Chairman of the Essex Legal Services Foundation, where he continues to serve as a Trustee.

Larry Sher – Partner, October Three Consulting LLC

Larry Sher is a member of the actuarial consulting team and part of the senior leadership for October Three.  Larry also is head of our dispute resolution practice, which provides support to clients in disputes related to their retirement plans, both in litigation and otherwise.  Larry’s experience in this area is extensive, having served as an arbitrator outside of litigation and as an expert in many lawsuits, including prominent cases involving cash balance pension plans.  Larry is a highly sought after expert and advisor.

Margaret Berger – Principal, Mercer Consulting


One thing is certain: the panel has no shortage of impressive resumes. But it’s ideas, not resumes, that will effectively reform New Jersey’s Pension System. Pension360 will keep you updated on subsequent developments surrounding the The Pension and Health Benefit Study Commission.

Chris Christie’s New Pension Proposal May Trigger Another Wave of Mass Retirements


Back in 2011, when New Jersey Gov. Chris Christie signed into law the state’s first round of pension reforms, a curious thing happened: state workers started heading for the exits. And they weren’t leaving for the weekend—they were leaving for good.

In fact, state workers retired in unprecedented numbers in 2010 and 2011, when the pension proposal was being discussed and passed through the legislature. Under the plan, workers have to contribute more of their paychecks to the pension system.

Now, Gov. Christie has announced he’s planning to propose a new set of pension reforms—and he’s made it clear that the benefits of workers will not come out unscathed.

With that news circulating, New Jersey is reporting that another wave of retirements is already in the making. The Star-Ledger reports:

As Gov. Chris Christie bangs the drum for a second round of pension reform in New Jersey, public officials and union leaders are bracing for another wave of public workers rushing to retire.

Employees in state and local government headed for the door in record numbers at the beginning of Christie’s first term, thanks in part to laws passed by the governor and state lawmakers asking public workers to pay a larger share of their health and pension costs. More than 20,000 retired in 2010, followed by 19,500 the next year.

After slowing the next two years, the pace of public worker retirements is picking up again, according to state Treasury Department figures.

A total of 11,916 employees are scheduled to retire through the end of this month — a nearly 9 percent spike from the same point in 2013. If the pace continues, about 17,000 may file papers by the end of the year. A total of 15,700 public workers retired last year.

The change comes as Christie gets ready to introduce further changes to the pension system, which is facing $40 billion in unfunded liabilities.

The Republican governor, a potential 2016 presidential candidate who rose to popularity partly because of his pension fights with public worker unions, said the previous changes didn’t go far enough. He has put curtailing the costs of public employee benefits at the top of his summer agenda, suggesting the state could go bankrupt without more action.

Union leaders have offered up various explanations for the spike. Some say the retirements are indeed caused by the virtual guarantee that workers will see their benefits decrease if they don’t lock them in by retiring.

But other union officials claim that the surge in retirements can be chalked up to random fluctuations. From

Some union leaders say more public workers may be planning to retire out of fear they could see their pensions and health benefits cut if they don’t get out now.

“There’s a feeling of unease about what’s going to happen,” said Pat Colligan, president of the state Policemen’s Benevolent Association. “People have left the past couple of months because they’re afraid. And there are people who have their finger on the retirement button.”

But Steve Baker, a spokesman for the New Jersey Education Association, the state teachers union, said he’s not convinced this year’s 9 percent increase in retirements was caused by Christie’s warnings, saying numbers fluctuate from year to year.

“They may be on the higher end of the range, but they’re certainly within the range,” he said.

Hetty Rosenstein, director of the state chapter of the Communications Workers of America, said she would be upset if Christie’s talk caused more public workers to retire in the coming months.

“You have people who have dedicated their life to public service,” said Rosenstein, whose union represents more than 40,000 state workers in New Jersey. “It would be really terrible and shameful if people make their retirement decisions based upon fear that after 30 years their retirement isn’t secure.”

Among public workers, retirements for teachers and non-uniformed government workers are both up 12 percent so far this year, while police and firefighter retirements are down 14 percent. Retirements for the State Police dropped from 145 to 83, the figures show.

In the decade before Christie was governor, public workers retired at a rate of 13,656 a year. Since he took office, the clip is at 17,602 — a 29 percent increase.

Bill Dressel, executive director of the New Jersey League of Municipalities, said part of the problem is that Christie has yet to unveil any details of his plan to revise public worker benefits.

“There’s always fear of the unknown,” Dressel said. “There’s not a clear message coming from our state policymakers.”

Christie is currently holding a series of town hall meetings around the state addressing pension issues. He has not announced specific details of his latest pension reform proposal, but he says he will release the proposal to the public by the end of summer.

Christie Says New Pension Reform Plan Coming

Back in 2011, New Jersey Gov. Chris Christie signed into law a pension reform measure designed to eventually fix the funding status of the state’s ailing pension funds.

A big part of that law was ensuring that the state gradually began making bigger annual payments to the System. But that part of the plan hasn’t worked out, as Christie decided this year to take the funds meant for the pension system and allocate them toward balancing the budget—a balanced budget is mandated by the New Jersey constitution.

The move was highly publicized and highly scrutinized. But Christie now says he is drawing up a new proposal for pension reform in New Jersey, and he is putting on a series of town hall meetings to introduce the plan. From NJ Advance Media:

Gov. Chris Christie came to the Jersey Shore today to kick off his “no pain, no gain” summer tour to introduce a pension reform proposal, but details of a plan were scant.

The governor promised to unveil a proposal by the end of the summer to tackle the state’s economic woes, promising that unless the Democratic-controlled state Legislature enact reforms, New Jersey is headed toward bankruptcy.

“We have to pare back benefits, that’s what we have to do,” Christie declared in Long Beach.

“You cannot raise taxes enough in New Jersey to pay for the pension hole that’s been dug over the period of time that these exorbitant benefits that have been promised to people,” he said. “No on in public office, believe me, myself included, wants to come out here and say ‘I have to pare back in public benefits.’”

Christie has said a specific plan is on its way — but it won’t be unveiled yet.

When pressed by a resident at the shore town hall to discuss his plan, Christie said his office is “looking at a bunch of different options right now,” but added it won’t be ready to be rolled out until the end of the summer.

“There are going to be some really difficult things,” he said. “There’s not a lot of places left to do things except to look at a whole different variety of ways to reduce benefits or to increase contributions by employees.”

Raising the retirement age again is also on the table for consideration, Christie said.

“But even then, the bottom line is that there will be a reduction in benefits, he said. “It’s the only way to do this.”

It appears that details won’t be disclosed for the time being. The one detail that Christie seemed comfortable revealing was that New Jersey pensioners will be looking at smaller benefits moving forward. But come September, it will be interesting to see what Christie’s proposal consists of.