From the Star Ledger:
The state Legislature passed legislation Monday handing control of the pension fund for New Jersey’s police and firefighters over to its members.
But it’s uncertain whether the governor will sign the bill as is.
Gov. Phil Murphy, a Democrat, has concerns over the Democrat-backed bill that would spin off police and firefighter pensions from the broader pension fund for state and local government workers, acting state Treasurer Elizabeth Muoio said following the votes.
The legislation is pushed by police and fire labor leaders who say state management has jeopardized their members’ retirement security by making insufficient financial contributions and choosing costly investment strategies. Over the past two decades, the fund has dwindled from fully funded to 65 percent funded.
Unions say their members can do better.
“We don’t feel that the state did a good job,” said Pat Colligan, president of the New Jersey State Policemen’s Benevolent Association. “We want to control our own destiny. It’s our pensions.”
State Senate President Stephen Sweeney, D-Gloucester, a sponsor of the bill, has said that labor-run funds elsewhere have successfully outperformed public boards.
Christie, a Republican, vetoed similar legislation last spring, saying it lacked adequate safeguards for taxpayers. While the state would be relinquishing management of the fund, state and local taxpayers would still have to pick up the tab if it goes south.
Christie called it a “blank check for public workers.”
The state Senate passed the bill 34-2, while the state Assembly voted 67-2 with seven abstentions, sending it to the governor’s desk, where its prospects are uncertain.
Muoio said Monday that Murphy “has been supportive of the basic premise of this bill for a long time,” but that there are concerns. Specifically, she said, all of the pension funds could incur penalties if forced to prematurely liquidate its hedge fund holdings.