An Associated Press news report said the pension funding bill passed the state Senate and Assembly Monday on a party-line vote. Democrats control both houses. The bill was approved 21-17 in the Senate and 42-36 in the Assembly.
“It’s a compromise I’m very pleased with because we need to be able to provide support to our communities that are struggling with this period of recession,” Corzine said before Monday’s vote, according to the report.
Corzine proposed the legislation in the fall as a way to provide property tax relief to municipalities during the recession (See NJ Governor Proposes Local Government Pension Relief ).
The Associated Press said the measure had stalled during legislative debate after some lawmakers contended that deferring the payments would be bad fiscal policy. Republicans in both houses remained united in their opposition to the bill, even after the number of years towns can defer their payments was reduced from three to one, and a provision was added to require towns to seek approval for the deferrals.
Corzine’s $29.8 billion budget proposal reduces the state’s contribution to the chronically underfunded pension system by $895 million from last year’s $1.1 billion contribution, the news report said.
Senate Majority Leader Stephen M. Sweeney, a Democrat, refused to sign on until the bill was amended to require towns to document financial need and present their requests to a local finance board for approval.
Municipalities would make up the payment shortfall over 15 years along with their regular contributions.
A bill to give Kentucky cities and counties short-term financial relief from retiree health care costs was approved by the state Senate budget committee last week (See KY Local Governments Could Get More Time to Fund Retiree Health Care ).