New Jersey’s pension fund has only two-thirds of the assets needed to pay future benefits, and the gap widened even as Gov. Chris Christie boosted employee contributions and froze raises, according to state data.
The seven retirement funds overseen by the $68.4 billion New Jersey Division of Investment, Trenton, had a funding ratio of 67.5% as of June 30, down from 70.5% a year earlier, according to data released by the Division of Pensions and Benefits. The deficit swelled by $5.5 billion during the 12 months to $41.8 billion.
To address chronic shortfalls, Mr. Christie in June signed bills that raised pension and health-care expenses for public workers, increased the minimum retirement age for new employees to 65 from 62 and froze cost-of-living increases.
Without Mr. Christie’s changes, the deficit would have been $61.8 billion, Andrew Pratt, a spokesman for state Treasurer Andrew Sidamon-Eristoff, said in an interview. “We always planned for that,” Mr. Pratt said. “This is no surprise.”
The unfunded liability stood at $53.9 billion before passage of Mr. Christie’s plan. After approval, the gap was lowered to $36.3 billion based on revised 30-year projections, Mr. Pratt said.
A 2010 law required the state to begin phasing in the full payments over seven years after a decade of lapsed funding. Mr. Christie this year has budgeted $484 million for a pension payment, according to the state Treasury Department. Actuaries had recommended the state put in $3 billion. Mr. Pratt said 20 years of underfunding “magnified” the problem.