Judge Approves Christie’s Pension Cuts [AUDIO]
Superior Court Judge Mary Jacobson ruled Wednesday in favor of Gov. Chris Christie in a lawsuit seeking to stop him from slashing this fiscal year's payment into the public employees' pension fund.
Attorneys for the governor argued successfully that Christie has the authority to do it in order to keep the budget balanced. The plaintiffs were union leaders whose lawyers argued that Christie is breaking his word and the law.
The law requires the state to contribute $1.6 billion into the pension system this fiscal year, but Christie now plans to pay in $696 million. He signed an Executive Order to enable the lesser payment.
“The court finds that executive order 156 is justified for Fiscal Year 2014 by the broad economic and social interests that permit the impairment of contracts,” said Jacobson when she announced her ruling. “The governor showed that the means chosen to further the broad societal and economic and economic interests of the state were reasonable and necessary under the circumstances of this budget shortfall.”
State Trooper Fraternal Association President Chris Burgos, the lead plaintiff for the unions, said he is disappointed and will review legal options.
“Well, obviously we’re a little disappointed in the outcome. We feel that there is some money around, some surplus money around,” said Charlie Wowkanech, AFL-CIO president. “Who’s to say what happens next year? I mean, the economy doesn’t improve or something happens and they come in again and ask for an emergency. I mean, when do all of these emergencies stop?”
In her decision that only impacts the Fiscal Year 2014 budget, Jacobson ruled the unions have a contractual right to a fully-funded pension. That opened the door for another court battle to stop the governor from reducing next year’s pension payment. On Wednesday, Christie was happy with the court’s decision.
“This was one of the hard choices the people of New Jersey expect me to make, and I am pleased the court recognized the necessity and urgency of this decision so that we can provide key funding for our schools, our colleges, our hospitals and other essential services,” the governor in an emailed statement. “For our state’s families who are already overburdened by high taxes, raising taxes even further would not solve a problem created by decades of neglect and irresponsibility.”
The top lawmaker in the State Senate did not share the governor’s happiness and sent out a statement of his own in reaction to the ruling.
“We are disappointed in the ruling and certainly disagree with the outcome,” wrote Senate President Steve Sweeney (D-West Deptford). “Still, Democrats put forward a budget that keeps our commitments to retirees and middle class New Jersey families regardless of the governor turning his back on them.”
Democrats are expected to pass a $34.1 billion budget Thursday that includes a tax hike on those earning over $1 million annually. Christie said he will veto it.
The governor’s pension payment plans extend into next fiscal year's budget which begins July 1. The payment was to be $2.25 billion, but the governor said he'll contribute $681 million.