Christie Cuts Pension Payment, Sets Up Battle With Legislature and Unions

Teachers plan lawsuit, state bond rating may drop.

Facing yet another budget shortfall, Gov. Chris Christie yesterday said he would slash pension payments by $2.4 billion, abandoning the pension-funding plan that was the signature achievement of his governorship and triggering a major confrontation with the Democratic Legislature and the public employee unions over the future of the state’s pension system,” reports.

Indeed: the New Jersey Education Association said it would file suit to restore the cuts. And Moody’s Inestment Service condemned Christie’s action.

“Christie’s actions directly violate the provisions of the 2011 pension law he and Sweeney championed that obligated the state to bail out the deficit-ridden pension system by a seven-year ramp-up to full actuarially required funding by Fiscal Year 2018, which would have required a final-year payment estimated at $4.8 billion in last Christie’s budget,” adds. “Now the Legislature will be forced to choose between accepting Christie’s cuts, raising taxes, or finding deep cuts to other programs.