|
 The stakes were high for Christie, who has trailed in polls behind
rivals such as Wisconsin Governor Scott Walker, a fellow Republican.
Christie came under fire for his handling of the state’s sluggish
recovery as well as a scandal around the 2013 George Washington
Bridge closure, which saw a former ally plead guilty to federal
charges.
"This will be a much-celebrated victory after a year and a half of
bad headlines," said Tim Albrecht, a Des Moines, Iowa, Republican
strategist. "The question is, will a lone victory be enough or will
Chris Christie be able to parlay this into something bigger."
Christie, who has not announced his candidacy for the Republican
nomination to run for president in November 2016 but has started a
political action committee, said in a statement the decision was an
"important victory" for taxpayers.
Bill Kilberg, a labor lawyer in Washington and a Christie supporter
said the decision would give donors "renewed confidence that he's
the serious candidate we all knew that he was."
 The state Supreme Court, in reversing a lower court ruling, said
while it lamented the "staggering" loss of public trust resulting
from broken promises, the pension payment was not a contractual
obligation entitled to constitutional protection.
Christie cut a state contribution to the public pension system last
year because of a revenue shortfall. The state's pension system has
about $83 billion of unfunded liabilities and was funded at only
about 44 percent in fiscal 2014.
Public-sector unions sued the administration, and in February
Superior Court Judge Mary Jacobson sided with them, finding that a
2011 pension reform law, signed by Christie, created a contractual
right that the state make its contribution. The state appealed to
New Jersey's highest court, which heard arguments in May.
“That the State must get its financial house in order is plain,"
wrote Justice Jaynee LaVecchia in the opinion. "The need is
compelling in respect of the State’s ability to honor its
compensation commitment to retired employees. But this Court cannot
resolve that need in place of the political branches.”
New Jersey has seen its credit rating downgraded nine times since
Christie took office in 2010. Standard & Poor's said the state could
be vulnerable to further downgrade if it does not solve its pension
problem. Moody's said long term, the ruling "reinforces the state’s
ongoing reliance on onetime budget solutions."
[to top of second column] |
Philip Fischer, municipal research strategist at Bank of America
Merrill Lynch, said the court essentially ruled that the
contribution was so large it violated the state constitution's debt
limitation clause.
"It takes the heat off the pension issue at least for a little while
and allows the legislature and the unions to ... figure out a way to
fund pensions consistent with the debt limitation in the
constitution," he said.
All parties are now expected to negotiate a "comprehensive
solution," said State Senate Republican Leader Tom Kean.
The Supreme Court voted to reverse the lower court ruling by five
votes to two. Justice Barry Albin, one of the dissenters, said the
decision "unfairly requires public workers to uphold their end of
the law’s bargain."
Hetty Rosenstein, New Jersey director of the Communication Workers
of America, the largest union representing state workers, said they
would have to try to change the constitution.
“It is devastating to all public employees, retirees, taxpayers, and
families," said Wendell Steinhauer, president of the New Jersey
Education Association, a teachers' union.
(Reporting by Jon Stempel, Megan Davies, Luciana Lopez, Jessica
DiNapoli, Jennifer Ablan, Karen Pierog, Hilary Russ; writing by
Megan Davies and Hilary Russ; Editing by Nick Zieminski)
[© 2015 Thomson Reuters. All rights
reserved.]
Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
 |
