NJ Judge Orders Christie to Fund Pension Plan
A New Jersey judge on Feb. 23 ordered Republican Gov. Chris Christie to work with the Democrat-controlled state Legislature to find a way to replace $1.57 billion in pension funds that Christie diverted to balance the state's 2014 fiscal year budget.
Mercer County Assignment Judge Mary Jacobson, in a 130-page ruling in Burgos v. New Jersey, said the administration violated the contractual rights of hundreds of thousands of current and retired public sector workers by line-item vetoing the pension payment out of the budget.
Jacobs said Christie's decision "constitutes a facial violation of the funding requirements of the public pension statute," otherwise known as Chapter 78.
Jacobson denied the state's motion to dismiss the lawsuit and granted the unions' request for relief. She did not, however, set a deadline.
Michael Drewniak, a spokesman for Christie, said the ruling would be appealed.
"Once again liberal judicial activism rears its head with the court trying to replace its own judgment for the judgment of the people who were elected to make these decisions," Drewniak said. "The governor will continue to work on a practical solution to New Jersey's pension and health benefits problems while he appeals this decision to a higher court where we are confident the judgment of New Jersey's elected officials will be vindicated."
Lawyers for the unions did not immediately respond to requests for comment.
Chapter 78, enacted in 2011, was hailed as a bi-partisan effort between Christie and the Legislature aimed at reforming the pension system for current and retired public-sector workers. Christie promised to fully fund pension obligations in return for public employees agreeing to increased contributions and lower cost-of-living raises.
The state's retirement systems currently face about $83 billion in unfunded mandates.
During oral arguments in January, Assistant Attorney General Jean Reilly said Jacobson should dismiss the unions' lawsuit because Christie acted within his authority when he made the decision to line-item veto the funds out of the fiscal 2014 budget.
"The decision was reasonable in light of the unprecedented revenue shortfall," Reilly said. The state's constitution requires a balanced budget and does not allow for deficit spending.
Funding decisions, Reilly said, are governed by the debt limitations clause and the appropriations clause of the state constitution.
But Jacobson said Chapter 78 created a contract between the government and the pension funds, which means that the contracts clause of the U.S. Constitution also must be considered. Jacobson noted that options, such as tax increases, were available that could have shored up the state's finances.
Christie, who is considering a run for his party's nomination for president next year, has repeatedly vowed to veto any tax increases passed by the Democratic-controlled legislature.
Reilly said the administration believes that any tax increases would not have brought in enough revenue to make up for the shortfall.
In her ruling, Jacobson said Christie has done an "apparent about face" regarding his position on the accomplishment of passing Chapter 78, adding that he initially described it as an "historic effort" and his "biggest governmental victory."
Jacobson said the clear intent of Chapter 78 was to "insulate the state contributions into the pension funds from the vicissitudes of the political process that had placed the integrity of the funds in significant jeopardy in the past."
Read more:
http://www.njlawjournal.com/id=1202718703611/NJ-Judge-Orders-Christie-to-Fund-Pension-Plan#ixzz3Sc2dmbqS
Ah yes, the ugly head of liberal judicial activism-that's a good one from Mike "the Mouthpiece" Drewniak.
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