The state’s pension payments have been cut, after Gov. Chris Christie made changes to the pension contribution system, and some say he has found a way around honoring past agreements. NJ Spotlight Editor at Large Mark Magyar told NJTV News Managing Editor Mike Schneider that the governor made the changes because he’s facing budget problems and that the reform won’t solve all the state’s financial issues.
“In the actuarial report, teachers’ pension and annuity fund, the actuaries who write the report said it was our understanding originally after the passage of the law that we would calculate the pensions in this particular way in which we would not count the additional contributions made by the workers,” said Magyar.
According to Magyar, pension contributions increased for state workers, at varying levels. He said those changes came from the Division of Pension Benefits.
When asked if the underfunding of the pension system was done on the basis of false assumptions or wishful thinking, Magyar said, “They were done on the basis of over estimating the amount of money the pension funds would be earning, and legislators and governors basically not making contributions,” Magyar said.
Magyar said that if Christie had not been facing budget problems, he would not have changed the formula.
State Treasurer Andrew P. Sidamon-Eristoff is set to meet with the budget committees in the Senate and Assembly next week. Magyar said that committee members and legislators are upset because they had to figure out the changes on their own. He said the changes were buried in the reports, taking a long time to find.
“People didn’t really figure it out until we saw the list of lapses and saw that there was $9.37 million listed in the mid-year budget cuts listed as surplus,” Magyar said.
According to Magyar, changes to the pension system won’t solve all of the state’s financial issues.
“These moves get him [Christie] barely through balancing this year’s budget and next year’s budget,” Magyar said.
Magyar wrote an article about the state’s pension system for NJ Spotlight.