Gov. Christie's budget 'double-crossed' public workers on pension promise

Gov. Christie's budget 'double-crossed' public workers on pension promise

Times of Trenton
on July 10, 2014
By Linda R. Greenstein

It wasn’t all that long ago that we could find Gov. Christie on one of his many political trips around the country boasting of the bipartisan plan he forged with the Legislature to save the state’s pension system from ruin.

That plan included ramping up not only the state’s contributions, which have lagged badly over the past couple of decades, but also significantly increased the paycheck deductions taken from the workers who contribute to it. There was also the elimination of the annual cost-of-living increase for retirees as well as steep increases in the contributions paid by workers for their health plans.

Now, less than three years after signing that landmark legislation into law, the governor refuses to uphold his end of the bargain and instead has turned his back on working and retired teachers, police officers, firefighters and other public servants who have upheld their end of a far heavier burden placed on them and their families.

The governor has gone from touting the pension changes made three years ago as “a model for the nation” to refusing to share in the burden by withholding $900 million in payments appropriated by the Legislature and due in the fiscal year that just ended June 30.

His budget is doing worse still in the new fiscal year that began July 1.

With his line item veto, the governor eliminated $1.6 billion in pension contributions offered by the Democratic majority that gave him a chance to stand by his promise. Instead, the governor will pay only $681 million toward the $2.25 billion pension contribution that is required under the 2011 law.

It seems when the going gets tough, the governor gets going -- the other way.

In contrast, before the governor’s line item vetoes, the Democratic proposal kept our promise to stand with the men and women who teach our children, protect our homes and families and provide the many public services that daily uphold our quality of life.

Led by Senate President Stephen Sweeney and Budget and Appropriations Committee Chairman Paul Sarlo, we crafted an alternative to Gov. Christie’s proposed $34.4 billion FY2015 budget.

Instead of foisting the burden on the public workers who have already sacrificed, only to be double-crossed by the governor’s budgeting, we instead asked that the wealthiest among us – those with earnings of more than $1 million annually – pay a little more for three years to help right the ship of state.

We also proposed a one-year surcharge on the corporate business tax that amounts to about 1.5 percent in real dollars and the temporary suspension of another business grant program.

The Christie administration has given away more than $4 billion in corporate tax breaks over the last five years, with the promise of new jobs that have not materialized. Instead, we remain at the back of the pack nationally and regionally when it comes to job creation and lowering unemployment.

There were arguments from the other side of the aisle during the recent budget debate that many millionaires in New Jersey have already left our state for tax havens elsewhere, claiming that if we increased taxes on the remaining millionaires, they’d head for the exits, too.

But the nonpartisan research arm for the Legislature, the Office of Legislative Services, has found just the opposite is true.

OLS reports that between 2003 and 2011 — a period of time during which the tax rate on millionaires was increased not once but twice — the number of millionaire tax filers in New Jersey increased a whopping 67 percent, from approximately 8,800 to 14,700.

None of us wants to see tax increases, but to bury our heads in the sand and try to wish away our obligations results not only in broken promises, but also in undue hardship for our public workers and pensioners. Ignoring our obligations has also resulted in a steady stream of credit downgrades, a total of six times under Gov. Christie’s watch so far.

As I stated on the floor of the Senate during the recent budget debate, an alternative is necessary to undo a morally bankrupt approach by this administration, as it turns its back on promises made.

The pensions have been earned and paid for by every police officer, firefighter, teacher and countless other civil servants who steadfastly, and in many cases selflessly, deliver for the taxpayer day after day, year after year, decade after decade.

The Democratic alternative to the governor’s budget was a responsible and morally sound budget and one where we kept our word to the workers we depend on to protect us from harm, educate our children, improve our roads and bridges and maintain our parks.

They’ve kept up their end by never once missing a payment. It’s a shame the governor struck down with his veto pen a responsible alternative that repays what we owe and what we agreed to in good faith.

Sen. Linda R. Greenstein represents the 14th Legislative District and serves on the Senate Budget and Appropriations Committee.