A rebuke of Gov. Chris Christie‘s pension and benefits reform law has left some bystanders wondering if it will be the first of many blows to an effort that won considerable praise from the state’s business community.
On Monday, Superior Court Judge Linda Feinberg ruled judges and justices were constitutionally protected from paying increased contributions to health care benefits and pensions, on the grounds that such an action is akin to a decrease in salary, which is outlawed to protect the judicial branch from political whims.
“I don’t know that (the ruling is) a major issue for businesses, but it does undermine the important pension and health benefits legislation that was passed on a bipartisan basis,” said Philip Kirschner, president of the New Jersey Business and Industry Association.
Kirschner said the issue of a judge deciding on a case that could potentially impact her is reason for concern.
“The judiciary always talks about the appearance of impartiality, and it certainly gives the appearance of it, if not the actual fact,” Kirschner said. “That standard, that there has to be always the appearance of impartiality, applies in all kinds of cases to businesses and individuals as litigants — why doesn’t it apply, then, to judges?”
“It will put more pressure on the ability of the state to be able to fund pensions and benefits going forward,” he added.
State Treasury spokesman Andrew Pratt said the state budget will not be affected by the pension portion of the decision, and there has been no order made by the court for the Treasury to refund or stop deducting 4.28 percent, instead of the previous 3 percent, for pensions from judges’ paychecks. The rate of deduction jumped to 4.28 percent Oct. 14.
Pratt said no dollar amount has been calculated yet for how much the Treasury would need to take out of the pension fund if a court order is issued.
“There’s only a few hundred people in this pension fund, but it has one of the most severe levels of underfunding of any fund, in terms of how much would need to be added,” Pratt said. “Long term, the pension fund reform plan was designed to make these pension funds more solvent.”
While Peter Woolley, professor of comparative politics at Fairleigh Dickinson University, said he believes the case will not act as a catalyst for the anti-reform crowd, he said the court cases brought by the other thousands of state workers and their unions against the state could have huge financial impact.
“If you’re trying to predict the state’s tax liabilities or spending means, the more important side of the equation is the suit by the state employees’ unions,” Woolley said. “I think at issue here is less the amount of money judges are saving by exempting themselves from these changes, but the fact that the governor is going to attack them as self-interested and as far too independent from the Legislature and the executive” branches.
Woolley said the ruling plays into Christie’s dialogue claiming the judicial branch has usurped too much power over state spending and taxation.
“There’s a whole history of the judiciary seeming to go against public opinion, the Legislature and the executive,” Woolley said. “It should be remembered that pension reform was passed by a Legislature that’s controlled by the Democratic Party … I think if it had been some sort of Republican super-majority that passed this legislation, people might be a little more sympathetic to the judges.”
