The Crisis in Public Sector Pension PlansEconomic Development, Fiscal Reform, Policy — By Paul Tyahla on June 25, 2010 at 3:51 PM
A Blueprint for Reform in New Jersey
The Mercatus Center at George Mason University unveiled a new report, highlighting New Jersey’s public employee pension crisis, and offering a path to meaningful reform. The report found that New Jersey’s five pension systems are underfunded by more than $170 billion combined, when using the accounting method standard in the private sector. That total is more than five times greater than this year’s total state spending and equal to 44 percent of New Jersey’s Gross State Product.
The Mercatus Center study suggests several reforms, including,
• Extend the defined contribution plan already available to state university faculty and staff and the state’s Defined Contribution Retirement Program to all state employees.
• Reduce or freeze cost of living adjustments (COLAs) to reduce the state’s unfunded liability.
• Transition non-vested workers to defined contribution plans.
CSI-NJ is working with the Mercatus Center to bring these findings to scholars, legislators and the media. To view the report in its entirety, visit this link.
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