[Congressional Record Volume 142, Number 31 (Friday, March 8, 1996)]
[Extensions of Remarks]
[Page E318]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               NEW JERSEY'S PUBLIC PENSION FUND SHORTFALL

                                 ______


                         HON. ROBERT E. ANDREWS

                             of new jersey

                    in the house of representatives

                         Friday, March 8, 1996

  Mr. ANDREWS. Mr. Speaker, yesterday the Star-Ledger of New Jersey 
reported on the troubling situation of pension funds for New Jersey's 
public employees. Governor Christine Todd Whitman has used these 
workers' investments to pay for her campaign promises from 1993, which 
the State could not afford. When Governor Whitman ran short on money to 
pay for important programs like Medicaid and education, she either 
tried to cut them, or she simply stopped paying the government's full 
share of the State employees' pensions.
  The result is a massive shortfall in State pensions, including a $2.5 
billion unfunded liability in the teachers' fund alone. What allowed 
this to happen is a legal system that lets the Governor use inaccurate 
economic estimates, and a State legislature that proved willing to 
comply. Governor Whitman is balancing the New Jersey budget on the 
backs of the State's workers, who are seeing their retirement funds 
placed in the greatest of danger.
  I have proposed a solution to this problem. In May of last year, I 
introduced legislation to grant State public employee pension 
beneficiaries the right to sue the State in a Federal court. My bill, 
H.R. 1683, does not stop a State from changing its contribution to 
retirement funds. Rather, it encourages the State to obtain the 
approval of a review board first. The board's primary responsibility 
will be the fund's economic health, not a political agenda. If a State 
uses such a panel, then any lawsuit filed by pension beneficiaries will 
be held to a much higher standard of proof.
  My bill will put the fate of State employees not in the hands of 
political opportunists, but of people who know how to make a pension 
fund work for the benefit and security of its members.

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