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No Reform in Sight for Bipartisan Abuse of State Pension Loophole

Currently, 18 state legislators collect pensions while receiving their legislative pay and many also receive lucrative salaries by being on the payroll of counties, municipalities, state colleges, or school districts, reported Mark Lagerkvist, a former Asbury Park Press investigative reporter who founded New Jersey Watchdog, the state chapter of Watchdog.Org, a project of the Franklin Center for Government & Public Integrity in Alexandria, Va.

“Wherever there’s a pension system, somebody’s always trying to game it to get something out of it, and this form of double-dipping is just one example of that,” said Lagerkvist, who has become a pension reform expert. “It’s human nature to game the system, but you’re looking at a pension system (in New Jersey) that’s facing a $47 billion deficit even by the state’s own conservative estimate.

“At some point, the bubble is going to burst and people who need those pensions are not going to be able to get them,” Lagerkvist said. In fact, questions have been raised about the future of Detroit's municipal pensions in the wake of the city's bankruptcy last month.

“Pensions were created so someone who works all of his or her life does not have to retire and eat pet food," he said. "Now the system is gamed to the point where people try to collect their pensions while still working and that’s not what the pension system was created to do.”

This is just the situation that the Beck-Oroho bill is intended to address. But the legislation has been languishing in the five-member Senate State Government Committee, whose chairman, Sen. James Whelan (D-Atlantic), collects a $35,160 state pension, his $49,000 legislator’s salary, and $71,564 as a fulltime teacher in the Atlantic City school district, according to Lagerkvist, who has been crusading on the issue for more than two years.

A second committee member, Sen. Samuel Thompson (R-Monmouth), collects a $51,996 legislative pension along with his $49,000 legislative salary – one of six Republican legislators out of the 18 lawmakers on the New Jersey Watchdog list.

Christie, who has called for passage of the Beck-Oroho bill banning the practice, was mild in his criticism of DiVincenzo two years ago when the story broke, particularly in comparison to his vitriolic attacks on New Jersey Education Association union leaders, the Passaic Valley Sewerage Authority, high-paid school superintendents, and other targets of his famous YouTube wrath.

That was in part due to DiVincenzo’s public support the week before for the pension and health benefits overhaul that Christie and Senate President Stephen Sweeney (D-Gloucester) were pushing through the legislature. It requires teachers, police, firefighters, and state and local government employees to pay more toward their pensions to bail out a system that is dangerously underfunded, partly because of decades of legal and illegal pension abuses designed to benefit the political class. Police union leaders held a mock “retirement” party for DiVincenzo before an Essex County Board of Freeholders meeting at which they served “double-dip” ice cream cones, but their efforts to derail the Christie-Sweeney pension and health benefits bill ultimately would prove to be unsuccessful.

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