Thursday, August 24, 2006

Can't Touch The Pensions

This one is for everyone that suggested pension changes and cutbacks as a potential solution to the property tax problem. From the APP:

Lawmakers told they can't cut current workers' pensions

Lawmakers looking to lessen property taxes by cutting back on benefits paid to government workers have been told they can't find immediate savings by changing the pension system for current or retired workers.

The Office of Legislative Services, a nonpartisan agency staffed by state workers, told the Joint Legislative Committee on Public Employee Benefits Reform on Wednesday that any law the Legislature passes to diminish retirement benefits for retired or active workers with more than five years in the system would be unconstitutional.

OLS cited a 1997 state law granting workers with five years or more of service a "nonforfeitable" right to the pension they were promised upon employment. Breaking this would violate provisions in the state and federal constitutions that say the state can't break contracts, the opinion said.

Some committee members expected the decision and said they will focus efforts on pension and medical benefits reforms for future hires.

One disputed the finding. Assemblyman Kevin O'Toole, R-Essex, disagreed with testimony by the opinion's author, OLS attorney Peter J. Kelly, that the only exception would be if the state were on the "verge of financial destruction."

O'Toole rejected Kelly's testimony that New Jersey can't argue that changes to the pension system are necessary for the state's solvency and keeping the pension system afloat.

If OLS is correct, O'Toole said, don't expect much from this committee.


Blogger grim said...

From the Star Ledger:

Lawyer cites statute protecting public workers' pensions

Pension benefits for public employees who have been on the job five years or longer cannot be reduced without violating the Constitution, a lawyer in the nonpartisan Office of Legislative Services told lawmakers yesterday.

"Benefits are protected for employees with five years or more of service and also retired employees," OLS attorney Peter Kelly told a legislative committee exploring ways of cutting property taxes by reforming pension and health benefits.

Kelly said a law passed in 1997 gave public employees with five years of service "a nonforfeitable right" to their pensions that can be lost only by dishonorable service. It also created a contractual obliga tion on the part of the state that is backed up by the New Jersey and U.S. constitutions, Kelly said.

8/24/2006 06:30:00 AM  
Blogger grim said...

From Newsday:

Some lawmakers trying to cut taxes oppose lowering own pensions

Some of the same lawmakers studying how to cut the state's high property taxes by changing public workers' benefits spoke Wednesday against lowering their own pensions. One state senator said "jealousy" was behind a push for limits on pensions held by elected officials.

The comments came as a legislative attorney told lawmakers the state cannot change publicly funded pension benefits for those who have worked government jobs for at least five years, including elected officials who hold multiple public posts.
Sen. Ronald Rice, D-Essex, who earned $135,000 last year as a deputy Newark mayor and a state senator, said limiting elected officials to a pension from just one job would result in no "substantial savings" for taxpayers.

Rice is a member of the special panel formed to recommend ways to revise public employee benefits to cut the state's highest-in-the-nation property taxes.

8/24/2006 06:32:00 AM  
Anonymous Anonymous said...

this is like being handcuffed to
a corspe.

no way to go but down

8/24/2006 06:37:00 AM  
Anonymous Anonymous said...

This is a snow job...don't be fooled, grim.



8/24/2006 08:14:00 AM  
Anonymous Anonymous said...


problem solved

8/24/2006 08:36:00 AM  
Blogger bubble disciple said...

and everyone thought welfare was the big problem...

the problem is ... us, the middle class, because so many of us work in the public sector...

the baby boom retirees are going to cause a big bust if we don't figure out something pretty soon.

PS - I work in the private sector, but my job will eventually be offshored

8/24/2006 08:50:00 AM  
Blogger jayb said...

Can't they pass a law repealing that 1997 law, even if temporarily?

8/24/2006 09:13:00 AM  
Blogger chicagofinance said...

"the baby boom retirees are going to cause a big bust if we don't figure out something pretty soon."

There are too many of them - they vote - they own us. If you are lucky you can pick up the scraps.

8/24/2006 09:22:00 AM  
Blogger grim said...

Can't they pass a law repealing that 1997 law, even if temporarily?

Put yourself in the shoes of a legislator.

Would you vote for a law that you knew would (significantly) negatively impact your future income?

Or would you vote for a law that guaranteed it?


8/24/2006 09:24:00 AM  
Anonymous Anonymous said...

Why is it that other states don't see such a big problem like NJ?

8/24/2006 09:27:00 AM  
Anonymous Anonymous said...

Really pissed off people in other states stopped the gravy trains, or at least have been taking steps to make the plans more responsible over the long run.

8/24/2006 09:56:00 AM  
Anonymous Anonymous said...


8/24/2006 09:56:00 AM  
Anonymous Anonymous said...

Can't they pass a law repealing that 1997 law, even if temporarily?

Yes they can, but how does that bennifit the government workers?

I think the solutions is simple to this one. When the "Union workers" cry because they are not getting enoguh money they go on strike.

So why can't NJ residents go on srike?
If everyone in NJ stopped paying property tax, they would have to figure something out real quick. There are more of us than them.
Why should the creeps on office have a say. We pay to have the be corrupt in office??
I say we all band together and stop paying and demand to off pensions and for people who are on 5 pensions to cut it back to 1. Also they do not need more than 85,000.00/year.
I guess that means they will have to sell there 4 mansions and buy a logical house. And anyone who has been working for the government 5 years or less should have there pension yanked and be given a 401K,
and make all government workers pay for medical, even the retired ones.

Come on everyone spread the word band together and stop paying property taxes until the government is run correctly.

8/24/2006 04:10:00 PM  
Anonymous Anonymous said...

To use a broad brush, Boomers need to wake up and realize that if they don't agree to a more equitable treatment of all employees their kids will be stuck in an awful place until enough of the boomers die off and let someone else decide what to do.

8/24/2006 07:07:00 PM  
Anonymous Anonymous said...

O.K., NJ residents:

Here's how it works.

Really, REALLY pissed off people start a website like this:

Then, you file a bunch of actions":

Then, you publicize:

Then voters go to the booths and vote out everybody.

Now. Some great NJ resident cuts and pastes everything from Russ.

As some other poster here so eloquently puts it [often]:
"End of story."

Budget done.


8/24/2006 09:10:00 PM  

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