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February 24, 2015 at 06:03 AM
(Bloomberg) — New Jersey Governor Chris Christie will seek to roll back pension-fund contributions in his next budget, a day after a judge said he broke state law by withholding $1.6 billion from the retirement system this year.
The 52-year-old Republican will present a spending plan Tuesday that seeks to contribute $1.3 billion to New Jersey’s government-employee pensions for the year starting July 1, according to a figure released by his office. That’s less than half the $2.9 billion it was scheduled to pay.
For the governor, the pension decision comes at a pivotal moment as he considers a run for the White House next year. After being dogged by a scandal over deliberate traffic jams at the George Washington Bridge and a struggling economy, Christie has sought to boost his national profile with trips across the U.S. and abroad. Now, he’s refocusing on New Jersey, where his approval rating has fallen to record lows, with his latest plan to manage revenue shortfalls and rising pension costs.
“The longer we push off the inevitable because it’s easier to let it be someone else’s problem, the harder it will be to solve the problem,” according to prepared remarks for Christie’s budget address.
The release of Christie’s budget plans come after state Superior Court Judge Mary Jacobson sided with unions that sued him for paying $1.6 billion less than the $2.25 billion due to the retirement fund this year. Christie plans to appeal the ruling, spokesman Michael Drewniak said.
$7.4 billion shortfall
The decision promises to put added pressure on Christie, who is already facing a political battle over how to balance the budget in the next fiscal year. New Jersey’s nonpartisan Office of Legislative Services said Monday that the state would need $7.4 billion more than it’s expected to have to meet all legal requirements and fund the government’s programs at current levels.
The state’s failure to set aside enough money to cover employee benefits has contributed to a record eight credit-rating downgrades under Christie, who came into office pledging to deal with rising retirement costs. Illinois is the only other state with a lower rating.
