NJ STATE PBA PRESIDENT WRITES: Today’s announcement by the Actuary for the Police and Firemen’s Retirement System (PFRS) that the value of the pension fund had dropped in 2012 is a cause for serious frustration by the members of the New Jersey State PBA.
Police officers, both active and retired, made a commitment to ensure [that] our pensions were secure under the guise of shared sacrifice, but politicians have again shortchanged the retirement system.
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NEWS: Retirement funds for local police, firefighters and state troopers in New Jersey slipped in the first year that workers were required to pay more toward their pensions. The report, released today, shows that investment returns for the funds were lower than expected — which widens the gap toward what’s needed to pay for retirements this year.
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The passage of Chapter 78 was heralded as the saving of the pension fund. Yet the decrease in the value of PFRS appears to stem from the same poor decisions that damaged the system starting a decade ago.
PBA members are now contributing 10% toward their pension, nearly the highest in the nation, and retired officers have seen their cost of living adjustment (COLA) eliminated.
But rather than place the money back into the pension system to boost its value, the [s]tate has cut the contributions into the system for local governments and has risked $200 million in pension funds by investing in the soon-to-be bankrupt Revel Casino.
The PFRS actuaries and even [l]egislators who supported Chapter 78 all agree that one of the main causes of losses in pension value was the skipping pension payments and granting of pension holidays to local governments of more than $2 billion in the last decade.
Relieving local governments of their lawful obligation on the backs of active and retired law enforcement to fund the Normal Cost of PFRS[,] as well as to pay back what they skipped paying in the past[,] has stripped value from PFRS that is needed to move us forward.
Politicians continue to push their obligations off to future generations and jeopardize the health of our pension system.
Unlike the [s]tate and local government, PBA members never skipped a pension payment.
The actuaries report gives many members pause to be concerned about more broken promises from elected officials.
Restoring the pension fund can’t just be a one[-]way street[,] and government should not be allowed to take out the extra funds that we put in to fix what the government broke in the first place.