Legislative Group Report Says 401(k)-Style Plans Should Replace NJ Pensions

TRENTON, New Jersey, Aug. 9 -- The New Jersey Business and Industry Association issued the following news release:

Economic and tax experts today recommended moving new and some current public employees into a 401(k)-style retirement plan instead of the underfunded NJ pensions system and providing them with a more affordable health benefits plan.

These are just two of the numerous recommendations to come from a 25-member Economic and Fiscal Policy Workgroup created by Senate President Stephen Sweeney, who released its report at a Trenton press conference today.

In a statement, NJBIA President and CEO Michele Siekerka said she was encouraged by what she heard at the press conference.

"While these ideas will require further review and appropriate stakeholder input, there is no question New Jersey needs to plan and adopt long-term, sustainable solutions to our fiscal challenges," she said.

"We need to see New Jersey's future through the lens of regional competitiveness and affordability and many of these initial recommendations make a good first step in that direction."

The recommendations include:

* shifting new hires and public employees with less than five years of service into a sustainable "hybrid" retirement plan.

* shifting from Affordable Care Act Platinum-level health plans to Gold-level for public employees and retirees;

* merging School Employees Health Benefits Program into the State Health Benefits Plan;

* focusing additional tax incentives toward small businesses; and

* merging partial school districts (those with K-4 to K-9 classes) into K-12 regional districts;

See the full report here (https://www.njbia.org/wp-content/uploads/2018/08/Economic-and-Fiscal-Policy-Report.pdf).

Siekerka thanked the group for its work.

"NJBIA thanks the bipartisan leadership of Senate President Sweeney, Senator Paul Sarlo, Senator Steve Oroho, Senator Anthony Bucco and the Economic and Fiscal Policy Working Group for today's recommendations.

"We look forward to working with the Legislature to advance proposals that will begin to set New Jersey on a path of economic vitality and business prosperity," she said.