The pension boards today announced a lawsuit against Gov. Chris Christie in an attempt to compel the governor to work with the legislature to restore what they see as legal and adequate pension funding.
The Board of Trustees of Public Employees’ Retirement System (PERS), the Police and Fire Retirement System (PFRS), and the Teachers’ Pension and Annuity Fund (TPAF) assert that Christie unlawfully derailed the proper funding of the state’s $80 billion pension system for political reasons.
“The Board of Trustees have been abandoned by their counsel, the Attorney General, who has chosen to side with the Governor by claiming the [existing] funding law is invalid,” wrote Tom Bruno, chair of NJ PERS; Wayne Hall, chair of NJ PFRS; and James Joyner, chair of NJTPAF. “As provided by statute, the Boards have retained separate counsel to collect the money owed to the pension funds and which have been diverted to more politically popular causes.”
The pension board reps said pension fund participants increased payment of their pension contributions from 3% to 7.1% and are on pace to reach 7.5% (PERS and TPAF) and from 8.5% to 10% (PFRS), while undergoing cost/value reductions of more than 32% (PERS and TPAF) and as much as 36% (PFRS).
The lawsuit will be filed this week in Mercer County Chancellery Court.
Senate President Steve Sweeney issued the following statement on Wednesday in response to the reports that New Jersey’s largest pension funds will file a lawsuit today against the Governor for slashing $2.4 billion in pension fund payments he promised to pay as part of a 2011 pension reform agreement:
“The reforms that the Governor so frequently praised in the past for restoring the fiscal stability of the pension system were built on the commitment we made and that he later abandoned. As I have said repeatedly, the answer to the problem is to keep our commitment to a full payment. That is why we passed a budget that included the full pension payment, identified a way to pay for it and sent it to the Governor.
“I welcome the support from the Public Employees’ Retirement System, the Police and Fire Retirement System and the Teachers’ Pension and Annuity Fund in demanding that the Governor honor his commitment to the hard working men and women of New Jersey. It’s not only the right thing to do, it is the fiscally responsible thing to do. The administration’s failure to make the payment has contributed to the downgrades in the state’s credit ratings and will undermine the reforms designed to restore the funds’ long-term financial health.
“The Governor should live up to his promise to make his required contribution. The employees are paying their share, he should do the same.”