High Court Denies Review of N.J. Pension Contribution Case

This leaves in place a New Jersey Supreme Court decision that contributions agreed upon in 2011 pension reform are not enforceable.

The U.S. Supreme Court has denied a request to review a case about whether New Jersey Governor Chris Christie violated the law by making pension contributions in an amount less than what was agreed upon in 2011 pension reform.

Previously, a New Jersey Superior Court judge ruled the state’s failure to make promised contributions into its pension systems was a substantial impairment of public employees’ constitutionally protected contract rights, and ordered the state to pay approximately $1.57 billion to the pension funds. This amount was previously approved in a fiscal year 2015 budget by the legislature, but removed by Governor Chris Christie.

However, the New Jersey’s Supreme Court ruled the legislature and governor were without power, because the pension contributions promised in 2011 reform are not part of an enforceable contract without voter approval.

The court said the promised contributions are enforceable only as an agreement that is subject to appropriation, which under the New Jersey constitution’s Appropriations Clause renders it subject to the annual budgetary appropriations process.