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Reader says , “Ummm, those unfunded pension liabilities are based on some outrageous assumptions”

Phill Murphy -Sara Medina del Castillo

“Ummm, those unfunded pension liabilities are based on some outrageous assumptions:

1. The State Investment Council assumes an annual return of 7.5% on the NJ state pension assets; a 30 year US treasury (which matches a long term pension liability) currently yields 2.825%. Pew Charitable Trusts suggests 6.5% is a more conservative assumption, which would increase the unfunded liability by 28% versus the current assumption assuming 7.5% annualized returns…

Continue reading Reader says , “Ummm, those unfunded pension liabilities are based on some outrageous assumptions”
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Reader says ,”the pension checks alone equate to 33.6% of the actual 2018 NJ state budget”

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Facts matter. Our retired public sector employees already draw $12 billion plus a year just in pension checks… not even including their “pay as you go” premium healthcare benefits until age 65. The pension checks alone equate to 33.6% of the actual 2018 NJ state budget. When the pension fu de go insolvent as forecast by 2027, NJ taxpayers will be in the hook for these pension & healthcare payments. Sweeney knows this and is telling the truth. The unions and their full-time lawyers just continue to lie and muddy the waters like the bloated piggies they are.

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Reader says , “public pension funds will be insolvent by 2027… which means NJ taxpayers have unlimited liability carrying the $12B per year”

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“NJ already has the highest combined, state, local, and corporate tax rates in the United States… and the public pension funds will be insolvent by 2027… which means NJ taxpayers have unlimited liability carrying the $12B per year paid out to retired public sector workers, plus their PAYGO (pay as you go) platinum health insurance… Ponzi scheme where the math doesn’t work when private sector employers are leaving and aren’t investing in the state. NJ also has net migration which only worsens the Ponzi scheme. Public sector unions only care about squeezing more blood from a shrinking stone. Greedy pigs “

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 “Same for CA, IL, etc, but When the state sends out $12bn a year already in annual pension checks (or 1/3 of our current annual NJ state budget), we have an unlimited pension liability in perpetuity once the public sector pension funds go insolvent by 2027… and that’s not even including “pay-as-you-go” (PAYGO) platinum healthcare insurance… the math doesn’t work. States like NJ, CA, IL, etc will have to explore bankruptcy filings to protect them from all of these excessive liability claims! “

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NJ BUILDING TRADES PRESIDENT BLASTS CWA LEADER FOR MISREPRESENTING PATH TO PROGRESS EFFORT

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the staff of the Ridgewood blog

Trenton NJ, Senate President Sweeney introduced a sweeping bill package aimed at slashing the high cost of government in New Jersey originating from the recent Path to Progress report. In response to the continued attacks by New Jersey public work leaders, particularly the leader of CWA, Hetty Rosenstein, the President of the New Jersey Building and Construction Trades Council, William Mullen, released the following statement.

Continue reading NJ BUILDING TRADES PRESIDENT BLASTS CWA LEADER FOR MISREPRESENTING PATH TO PROGRESS EFFORT
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“Path to Progress” First Step in Putting New Jersey’s Fiscal House In Order and Avoiding Pension Apocalypse

the staff of the Ridgewood blog

Trenton NJ, The legislative introduction of the fiscal reforms and cost saving initiatives from the “Path to Progress” report has already generated widespread support from an array of individuals and organizations throughout New Jersey, including:

“The state of New Jersey faces short and long term challenges. I was pleased to be part of the ‘Path to Progress’ team as several of our recommendations will significantly improve the fiscal health of the state – particularly those related to employee pension and health benefits, and school consolidation. Of particular note – even with the pension reforms – no current retiree or those employees already vested will be negatively impacted.” – Richard F. Keevey, former Budget Director and Comptroller for the State of New Jersey, former CFO, U.S. Department of Housing and Urban Development, and former Deputy Under Secretary for Finance, U.S. Department of Defense

Continue reading “Path to Progress” First Step in Putting New Jersey’s Fiscal House In Order and Avoiding Pension Apocalypse
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Senate President Steve Sweeney Says Its Time to Confront the State’s Mounting Fiscal Problems

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the staff of the Ridgewood blog

Glassboro NJ,  Speaking at a policy forum last night, Senate President Steve Sweeney talked about the need to confront the state’s mounting fiscal problems and warned that New Jersey won’t be able to make critical investments in education, transportation, higher education and social services unless it enacts major structural reforms to address the looming budget crisis fueled by runaway pension and benefit costs.

Continue reading Senate President Steve Sweeney Says Its Time to Confront the State’s Mounting Fiscal Problems
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Senate President, Assembly Majority Leader focus on pension overhaul, benefits reform and property tax relief at Rowan event

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the staff of the Ridgewood blog

Trenton NJ, while Murphy Administration called on liberal activists, to push back against state Senate President Stephen Sweeney’s big plan to fix New Jersey’s long-term fiscal problems , Senate President Steve Sweeney and Assembly Majority Leader Lou Greenwald tonight warned that New Jersey won’t be able to make critical investments in education, transportation, higher education and social services unless it enacts major structural reforms to address the looming budget crisis fueled by runaway pension and benefit costs.

Continue reading Senate President, Assembly Majority Leader focus on pension overhaul, benefits reform and property tax relief at Rowan event
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Volcker Alliance : New Jersey has funded Only 36% of its pension debt with an unfunded liability of $143.2 billion

the staff of the Ridgewood blog

Ridgewood NJ, the state of New Jersey received a report card for managing its pension debts . The non-partisan Volcker Alliance, founded by former Federal Reserve Chair Paul Volcker, rated the state a D- for its failure to have properly “provided adequate funding, as defined by retirement system actuaries, for pensions and other promised retirement benefits for public workers.”New Jersey was one of six states to receive the lowest possible grade in the analysis, along with Hawaii, Illinois, Massachusetts, Texas and Wyoming.

As of June 2017, the Garden State has funded a mere 36% of its pension debt with an unfunded liability of $143.2 billion, 2nd worst in the nation behind Kentucky’s 34% funding.

The 2018 Volcker Alliance report, Truth and Integrity in State Budgeting: Preventing the Next Fiscal Crisis, which, in addition to legacy costs, grades and proposes a set of best practices for policymakers on issues including: budget forecasting, budget maneuvers, reserve funds and transparency.

The report adds fuel to the fire of support for New Jersey pension and benefits reforms proposed in the recent “Path to Progress” report issued by State Senate President Steve Sweeney’s bi-partisan New Jersey fiscal policy working group.

· Shift new state and local government employees and those with less than five years of service in the Public Employees’ Retirement System and the Teachers’ Pension and Annuity Fund from the current defined benefit pension system to a sustainable hybrid system and preserve the current system for employees with over five years of service who have vested contractual pension rights.

· Shift all state and local government employees and retiree’s health care coverage from Platinum to Gold.

· Require all new state and local government retirees to pay the same percent of premium costs they paid when working.

· Merge the School Employees Health Benefits Program into the larger State Health Benefits Plan and make the plans identical in coverage.While formal legislation has yet to be introduced regarding Senator Sweeney’s proposals, reports indicate that bills will be introduced by the end of the year or early 2019.

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Trenton Continues to Drive Residents From the State

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July 7,2018

the staff of the Ridgewood blog

Trenton NJ, around two years ago, New Jersey’s richest resident , hedge fund billionaire David Tepper decided to move himself and his business to Miami Beach. Tepper, who personally earned more than $6 billion from 2012-2015, was tired of paying New Jersey’s top income-tax rate of 8.97% for the 20 years he lived there, in addition to the country’s highest property taxes, the estate tax and inheritance tax. By moving to Florida, a state with ZERO income tax, Tepper stood to save hundreds of millions of dollars each year. Tepper’s departure left an enormous hole in the New Jersey budget .

Anyone with an ounce of common sense would have at least acknowledged the possibility that a guy like Tepper would consider moving to save a few hundred million dollars , anyone that is except ,”stuck on stupid ” Trenton .

Tepper is not the only one to leave , according to the New Jersey Business and Industry Association, the State of New Jersey lost a whopping 2 million residents between 2005 and 2014, earning a combined $18 billion in net adjusted gross income, i.e. income that would have been taxed by the state.

With those out flow numbers Its not just the masters of the universe that are tired of paying sky-high taxes. It’s also the regular wage earner and small business owners. A whopping 60% of these folks went to Florida, with a state income tax of zero.

So the message from New Jersey’s residents (well, now former residents) is loud and clear: taxes are too high!

Now, what do you think New Jersey is doing to solve this problem?

New Jersey residents elected a governor that promised to raise their taxes, so instead of making the state friendlier to productive people and businesses , New Jersey has embarked on a program of driving out tax payers and replacing them with tax takers .

New Jersey now taxes residents making more than $5 million will now pay 10.75%, up from 8.97%.The corporate rate on businesses with more than $1 million in net income was also increased from 9% to 11.5% (Proportionally, that’s a potentially 27% increase in the amount of tax a business might pay).

This will simply exacerbate the problem even more ,chasing more businesses and people out of the state .

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Assemblywomen Holly Schepisi : “Any tax and spending increases without real reforms to our pension system is irresponsible and reckless”

July 1,2018

the staff of the Ridgewood blog

Trenton NJ,in a last minute deal the state government shut down has been avoided . Assemblywomen Holly Schepisi , “Update for New Jersey residents. It appears a State shutdown will be averted. On the upside you will be able to go to the beach, the racetrack or a casino, and renew your license. On the downside you will be paying even more for gas, internet purchases, hospital visits, plastic and paper bags, Airbnb, Uber and Lyft, health care, and utility bills. I keep hearing a mantra of New Jersey needs sustainable revenue. However New Jersey has significant revenue. New Jersey ranks in the top 5 highest taxed states in the country. New Jersey has among the highest pension debt. Any tax and spending increases without real reforms to our pension system is irresponsible and reckless. Good luck New Jersey residents. You voted for this”