APRIL 16, 2015, 10:13 PM LAST UPDATED: THURSDAY, APRIL 16, 2015, 10:18 PM
BY SALVADOR RIZZO
STATE HOUSE BUREAU |
THE RECORD
Moody’s Investors Service announced a downgrade of New Jersey’s credit rating Thursday night, citing a “lack of improvement in the state’s weak financial position” and recent pension-funding shortfalls.
The state’s bond rating fell one step, from A1 to A2, at a time when Governor Christie and state lawmakers are building a state budget for the coming fiscal year. Christie, a Republican, has proposed a $33.8 billion spending plan that would make a $1.3 billion contribution to the pension funds, less than half what is legally required under a 2011 pension overhaul he signed.
Shorting the pension payments for the third year in a row, as Christie proposes, would saddle the retirement system with more long-term costs. Moody’s raised concern that the system may run out of money in nine to 12 years unless state officials make further changes to pension laws.