Jersey Gov. Christie calls for pension reform
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[February 25, 2014]
By Hilary Russ
(Reuters) — New Jersey Governor Chris
Christie will call for a new round of public pension reform when he
presents his fifth state budget on Tuesday, according to remarks
released in advance.
Christie, a Republican, worked with the Democrat-led legislature
in 2011 to make changes to retirement systems for public employees.
But the changes did not go far enough to stem the tide of rising
costs for pension and health care benefits, Christie said in the
remarks. New Jersey must make a $2.25 billion payment into its
pension system in fiscal 2015, which begins July 1.
"The problem isn't going away by itself. We must do what we were
sent here to do by the people — lead and act decisively once again,"
he said in the remarks.
Under the previous reforms, the state's pension contributions have
been rising by a set amount each year, to culminate at $4.8 billion
in fiscal 2018 in an effort to make up for years of underfunding.
Pressure from rising fixed costs, including pensions, comes as New
Jersey's economic recovery lags the rest of the nation, with
revenues that could fall $400 million short of projections by the
end of the fiscal year.
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Moody's Investors Service lowered its outlook on New Jersey's Aa3
rating to negative in December, in part because of the pension. The
credit rating agency also cited lower-than-expected cash balances
and revenues, as well as a persistent structural gap.
(Reporting by Hilary Russ in New York; editing by Lisa Shumaker)
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