The legislature is taking steps to shore up the state pension system, approving a bill that would require the state to make quarterly, rather than annual pension payments. The bill (S-2810/A-4) passed both the state Senate and Assembly unanimously and has been sent to the governor’s desk for approval. Christie vetoed this measure twice before, but the Senate President is optimistic about the bill’s prospects. With the bill now on the governor’s desk, we urge that him to take swift action and sign it into law. Quarterly payments would be scheduled for Sept. 30, Dec. 31, March 31, and June 30. The law would take effect on July 1, 2017.
The switch to quarterly payments would save the pension system and taxpayers billions of dollars over the long run. By front-loading payments, investments have the chance to grow throughout the year unlike an annual lump sum payment at the end of the fiscal year. Furthermore, quarterly payments lower the potential of reduced year-end contributions.
In addition to the savings that would be made possible through quarterly payments, the Assembly unanimously approved a bill (A-4328) concerning contracting methods with Pharmacy Benefit Managers (PBM). It is estimated to reduce health care costs by $200 million. It was previously passed by the Senate.
We recognize those legislators who voted in support of these measures and give special thanks to Senate President Sweeney and Assembly Speaker Prieto for their work to advance this critical legislation. We further thank our affiliates for taking action in support of full and responsible pension funding.