TRENTON, N.J. (AP) — Republican Gov. Chris Christie and Democratic Senate President Stephen Sweeney have reached a deal to change retiree pension and health benefits by requiring public workers to pay more for both.
The deal, if approved by the Legislature, would require bigger contributions from all public workers beginning July 1, a person who has been briefed told The Associated Press. The person insisted on anonymity because the deal has not been made official.
An official announcement is planned for later Wednesday. Details were still being worked out by Democrats who control the Senate.
Assembly Speaker Sheila Oliver, also a Democrat, has been involved in the talks over the past several weeks, but it’s not known whether she agrees with the deal. Her spokesman, Tom Hester Jr., declined to comment Wednesday.
The governor’s office did not respond to messages for comment.
The pension and retirement health systems are both underfunded by tens of billions of dollars. The proposal is designed to reduce the long-term indebtedness of both systems.
One provision of the deal would require the state to make its annual pension payment. Governors of both parties have skipped or greatly reduced their pension contribution in most of the past 20 years.
The deal would raise pension contributions immediately by at least 1 percent for public workers such as local police and firefighters; teachers; state police; and state, county and municipal workers. Judges, who now put 3 percent of salary toward their pensions, the least of any public worker group, would see that amount increase to 12 percent.
The deal also would require employees to pay more for health care under a new salary-based contribution formula that would be phased in over four years. The rate could be as high as 30 percent of the cost of the premium for top wage earners. Most workers now pay 1.5 percent of their salary toward health care regardless of the cost of their plan.
The proposed state budget for the fiscal year that starts July 1 relies on more than $300 million in savings from health benefits reforms.