Bill to Strengthen Pension System & Allow for Investment Advanced by Assembly Panel
Updated On: Jul 08, 2015
Prieto Bill to Strengthen Pension System & Allow for Immediate Investment Advanced by Assembly Panel
politickernj.com - TRENTON – Legislation Assembly Speaker Vincent Prieto sponsored to make a $300 million supplemental state appropriation for the current fiscal year for additional employer contributions to the state pension systems was advanced Tuesday by the Assembly budget panel.
The funding represents a prepayment of a portion of the state’s required $3.1 billion fiscal year 2016 payment.
“Democrats are committed to fiscal responsibility,” said Prieto (D-Hudson/Bergen). “Failing to make the required pension payment has put the state deeper in the fiscal trouble, led to state credit rating downgrades and hurt New Jersey’s economy. We need to balance the budget and fully fund our obligations, and this prepayment is part of our effort to fix these problems and move the state’s economy in the right direction.”
The bill (A-4006) represents a down payment toward the statutorily required FY 2016 state contribution of $3.1 billion to the retirement systems, or 5/7 of the full actuarially determined annual required contribution. Prieto said the appropriation in FY 2015 ensures that the $300 million is invested immediately, rather than at the end of June 2016.
The Office of Legislative Services has identified an additional $300 million in revenue in FY 2015.
“The intent of this bill is to get that funding invested in the pension system as soon as possible,” Prieto said. “Doing so allows for the earning of investment returns in FY 2016 on the appropriated amount.”