Phil Murphy, a former Goldman Sachs executive, was elected governor of New Jersey on Tuesday, defeating Lt. Gov. Kim Guadagno.
Mr. Murphy, a Democrat and a former ambassador to Germany, won 55.6% of the vote vs. 42.4% for Ms. Guadagno. Mr. Murphy had served as global co-head of Goldman Sachs's investment management division and was a senior director.When Mr. Murphy is sworn in Jan. 16, Democrats will control the governorship and both houses of the Legislature for the first time in eight years since Chris Christie, a Republican who is term-limited after two terms, defeated Jon Corzine, another former Goldman Sachs executive.
During his campaign, Mr. Murphy criticized Mr. Christie and Ms. Guadagno for multiple issues, including management of the $75.6 billion New Jersey Pension Fund, Trenton.
Mr. Murphy campaigned on restoring annual state payments to the pension fund at the full actuarially determined contribution, but he offered no timetable other than to say "as fast as possible."
In a report issued Wednesday, S&P Global Ratings said the state has never paid "even as much as 60% of the actuarially determined contribution" to the pension system over the past 20 years.
For the current fiscal year, which started July 1, the state is making a $2.5 billion contribution, which includes an estimated $1 billion from the proceeds of the state lottery. The contribution would be 50% of what was actuarially determined, the highest since 2008, the report said.
"Maintaining even this (payment rate) will become more difficult during an economic downturn or if state spending increases," the S&P report said. "Getting New Jersey out of this situation could take years and multiple gubernatorial administrations."
Each year New Jersey postpones full pension contributions, "the structural budget gap grows," the S&P report said. "The state's generally accepted accounting principles pension funded ratio of fiduciary net position-to-total pension liability has been dropping, falling to 31% as of the most recent valuation date."
The S&P report said that even if New Jersey approves "near-term tax increases or spending cuts," the shortfalls under both Republican and Democratic administrations "in funding pension contributions over the past 20 years," has left the state with "a high unfunded pension liability, a high debt burden, high state and local tax rates, and an annual state structural deficit."