Supremes side with Christie on pension payments

Supremes side with Christie on pension payments

By Matt Rooney | The Save Jersey Blog

Did you hear that noise, Save Jerseyans?

It’s thousands of public sector union heads exploding in unison.

The New Jersey Supreme Court issued an 5-2 opinion in the pension payment case (Christopher Burgos v. State of New Jersey) on Tuesday morning, reversing a lower court’s directive to the Christie Administration to make a billion dollar pension payment. Click here to read it. For a little background on the Christie/pension payment controversy, click here.

Supreme CourtThe majority opinion (which did not include Chief Justice Rabner) relied on the text of the Debt Limitation Clause:

“No matter how worthy the cause to be advanced by Chapter 78, the Debt Limitation Clause speaks directly to this situation and, in pertinent part, commands:

“‘The Legislature shall not, in any manner, create in any fiscal year a debt or debts, liability or liabilities of the State, which together with any previous debts or liabilities shall exceed at any time one per centum of the total amount appropriated by the general appropriation law for that fiscal year, unless the same shall be authorized by a law for some single object or work distinctly specified therein. . . . [N]o such law shall take effect until it shall have been submitted to the people at a general election and approved by a majority of the legally qualified voters of the State voting thereon.’”

Bottom line (and a hugely important one): state statutes are not contracts, the position asserted by Big Labor in this case; moreover, the state still cannot create a binding debt without the public assent at the polling booth, a principle last asserted in the Lonegan I and Lonegan II decisions from the early 2000s.

“The purpose to be achieved by the Debt Limitation Clause dovetails with the Framers’ intent for a fiscally responsible annual budget process,” the majority continued. “Efforts to dedicate monies through legislative acts other than the annual appropriations act have no binding effect. They are read as impliedly suspended when contradicted by the budgetary judgment of the presently constituted Legislature acting in concert with the Governor in their constitutionally prescribed budget formation roles. Those debt limitation and appropriations-related constitutional clauses conflict with the contractual language of Chapter 78 and thwart plaintiffs’ impairment claims.”

christie smileOK. But here’s some food for thought as we move forward into  legislative general election cycle: how can the Court say that it has no place in the budget process but then also push the Abbott District issue that unambiguously places the Court at the center of the budget process?

This particular collection of five justices is saying some interesting things. “The Appropriations Clause firmly interdicts the expenditure of state monies through separate statutes not otherwise related to or integrated with the general appropriation act governing the state budget for a given fiscal year. Given the Legislature’s inherent power to disregard prior fiscal enactments, the Court cannot compel the Legislature to appropriate in accordance with other 4 statutes that are not incorporated into the general appropriation act,” the Court held.

And the best pull quote:

That the State must get its financial house in order is plain. The need is compelling in respect of the State’s ability to honor its compensation commitment to retired employees,” it added. “But this court cannot resolve that need in place of the political branches. They will have to deal with one another to forge a solution to the tenuous financial status of New Jersey’s pension funding in a way that comports with the strictures of our constitution.”

This is the right decision, Save Jerseyans. And the right sentiment! No doubt about it. Still… again… we wish there was a little more consistency from the bench! Hence, why we need a GOP Senate and a majority that consistently applies this philosophy of restraint.

To be continued…

Meanwhile Governor Christie, for his part, seized upon the ruling to call for a reset. “This decision is an important victory not only for our taxpayers who simply cannot afford these unsustainably high costs, but for limited, constitutional government that recognizes the proper role of the executive and legislative branches of government,” he said in a statement released to the media. “The Court’s position is clear, as is mine, it is time to move forward and work together to find a tangible, long-term solution to make our pension system and public employee health benefit costs affordable and sustainable for generations to come. In light of today’s decision, I urge all interested parties to come back to the table and partner with me to finally solve this problem once and for all.”


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