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Proposal to boost N.J. pensions with lottery could happen this year, treasurer says

New Jersey LotteryNew Jersey Lottery: Proposal to boost N.J. pensions with lottery could happen this year, treasurer says
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TRENTON, N.J. — The state treasurer said Thursday that Gov. Chris Christie's proposal to use New Jersey Lottery ticket proceeds to bolster the government worker pension fund could be finalized by the June 30 end of the fiscal year.

Christie floated the somewhat opaque proposal to transfer assets from the lottery to the pension fund in his February budget address. His administration hasn't released any additional details since, including what would happen to  the programs currently funded by the lottery. 

"When can we expect a detailed proposal on this lottery concept? Sen. Paul Sarlo (D-Bergen), chairman of the Senate Budget Committee, asked the treasurer as a budget hearing Thursday. "Don't tell us June 30. We're all intrigued by it. Why wait?"

Treasurer Ford Scudder assured Sarlo more information would be made available in the near future.

Roughly, Christie wants to pledge the lottery as an asset to the pension fund, dramatically reducing its unfunded liabilities, which currently sit at about $49 billion for the state, or $66 billion if local government debts are included as well.

Christie has said the shift would immediately reduce the unfunded liabilities by $13 billion. The treasurer's office has issued a request for proposals for a valuation of the lottery system, which generates about $1 billion a year.

New Jersey accrued these high unfunded liabilities over years of contributing less than recommended by actuaries into the pension fund, in which some 800,000 current and retired state and local government employees are enrolled.

Christie has been increasing payments into the system by one-tenths of what's recommended by actuaries each year, but it's not yet enough to turn the tide. 

Without the rush of cash, the system won't become even 80 percent funded for another three decades, Scudder said, adding that the lottery proposal could improve that timeline by as much as 10 or 20 years.

"That provides a lot of additional security to the pension system," he said.

This will not require a change in the state Constitution, which requires that lottery proceeds be spent on state institutions and state aid for education, Scudder said.

The state pays a number of costs on behalf of local school districts that can be categorized as aid, including the employer share of the Teachers' Pension and Annuity Fund.

As it stands, the $965 million the lottery is expected to receive from ticket sales helps fund higher education programs, psychiatric hospitals, centers for people with developmental disabilities and homes for disabled soldiers.

Christie's proposal has triggered concerns about what will happen to these programs if the lottery money is rerouted to the pension fund.

Scudder said Thursday that once the lottery reduces the unfunded liabilities of the pension fund, the state won't have to kick in as much money each year. The money freed up in the general fund should be able to help cover those programs.

The instability of the public pension fund remains one of New Jersey's weak spots, with Wall Street rating agencies downgrading its credit rating 11 times under Christie. The most recent rating change by Moody's Investors Service cited the state's "rapid pension liability growth, exacerbated by underfunding to maintain budget balance."

Moody's said it would take much more than the governor's one-tenths plan to improve the state's outlook.

NJ

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7 comments. Last comment 3 months ago by Gleno.
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Raven62's avatar - binary
New Jersey
United States
Member #17843
June 28, 2005
63441 Posts
Offline
Posted: April 7, 2017, 10:27 am - IP Logged

When Politicians See Other Peoples Money (Tax Revenue) They Are Quick To Spend It: On Everything Except What It Was Intended!

A mind once stretched by a new idea never returns to its original dimensions!

    LiveInGreenBay's avatar - driver
    Green Bay
    United States
    Member #169391
    October 15, 2015
    1513 Posts
    Offline
    Posted: April 7, 2017, 5:40 pm - IP Logged

    Unfunded public employee pension fund liabilities 66 billion dollars?  LOL whats wrong with that picture?

    Never give up.  Banana

      dpoly1's avatar - driver
      PA
      United States
      Member #66141
      October 16, 2008
      1714 Posts
      Offline
      Posted: April 7, 2017, 6:57 pm - IP Logged

      Screw Public Employess other than Fire and Police!

      Cussing Face

      dpoly1 - Playing the lottery to save the jobs of those that build, transport, sell & maintain luxury items! -

       

      Eschew Poverty ........... Vote Conservative!

        Avatar
        Simpsonville
        United States
        Member #163189
        January 22, 2015
        873 Posts
        Offline
        Posted: April 9, 2017, 3:23 pm - IP Logged

        Unfunded public employee pension fund liabilities 66 billion dollars?  LOL whats wrong with that picture?

        that is my thought.  Why aren't they required to contribute or have 403B like we do @ work?  New Jersey is a tax me to death state.  Look at how Atlantic City taxes the heck out of their casinos and how many folks are on the public employee payroll there.  Supposedly they are cutting back.  Then there are toll roads all over the place; NJ turnpike, Garden State Parkway and Atlantic City Expressway are some that come to mind.  I know, I was stationed @ now closed Ft. Monmouth, NJ.  (and of course pay to park @ the casinos too).

          American Indian's avatar - disney14
          USA
          United States
          Member #172127
          January 16, 2016
          159 Posts
          Offline
          Posted: April 11, 2017, 7:34 am - IP Logged

          Christie Is just like the Idiot In the White House neither care about Children's Education, the Disabled, Or Our Veteran's, as for the Casino's that's mostly T's $$ for his family an there Life Style they have to uphold. Maybe It's for the fence, how much good Is that going to do, they use Tunnels have since late 80's!!!

          I thought the whole Idea for the Lottery Money to begin with was for Student Education, among other things but never did I hear anything about Pension Funds? WEASELS...............

           I AM TIRED OF NOT WINNING!!!! ROFL

            Gleno's avatar - Lottery-001.jpg
            New Jersey
            United States
            Member #80354
            September 25, 2009
            717 Posts
            Offline
            Posted: April 11, 2017, 9:30 am - IP Logged

            4/11/17

            There's  so much talk about funding public employees retirements not surprised that tapping the lottery was next pool of cash to attack.

            Rant

              Gleno's avatar - Lottery-001.jpg
              New Jersey
              United States
              Member #80354
              September 25, 2009
              717 Posts
              Offline
              Posted: April 11, 2017, 9:36 am - IP Logged

              4/11/17

              Burlington County Times in NJ had front page headline for 4/11/17 ", Gov. Christie seeking support for Lottery Proposal"

              Coffee