N.J. Assembly passes bill calling on public unions to pay more for health care

TRENTON - Boos and screams from union workers broke out in the Statehouse Thursday night after the New Jersey Assembly approved a bill, 46-32, to have government employees pay more for their health and pension benefits.

The session, scheduled for 1 p.m., started 5½ hours late and the vote was not taken until 9.

The legislation passed with about a third of the Democratic majority joining the GOP minority after hours of passionate debate in an internal caucus meeting failed to persuade Speaker Sheila Oliver (D., Essex) to postpone the vote.

The bill, described by unions and many Democrats as an unprecedented theft of collective-bargaining rights, is the greatest legislative achievement in Republican Gov. Christie's term so far, and it will serve as the backdrop for the looming budget showdown.

After the vote, Christie released a statement promising a saving of $120 billion over 30 years for the pension part of the bill, and $3.1 billion over a decade for the changes to health benefits.

"We are once again showing the people of New Jersey that our state is leading the way on the biggest challenges before us and remains unafraid to do what is hard but necessary," he said.

Just after the session began, Oliver and Senate President Stephen Sweeney (D., Gloucester) announced that a companion bill would be amended to eliminate a controversial provision regarding out-of-state medical care. The amendment passed, 76-0.

The measure originally had required health-care plans that limit public workers to in-state medical providers, though plans without that restriction also could be bought.

Sweeney had said that would encourage more people to go to New Jersey hospitals, which have struggled financially. The plans allowing out-of-state care were expected to be more expensive and were panned by critics as a boon to Sweeney's longtime friend, South Jersey powerbroker George E. Norcross III, who is chairman of Cooper University Hospital in Camden.

"After very lengthy discussions, it was clear that this provision is a genuine concern amongst the members of my caucus," Oliver said in a statement. "Removing this provision is the best way to move forward."

On Monday, the full Senate is to vote on the change, and Christie has said he will sign the bill.

"Of the 500,000 men and women who are our public workers, this is not your fault," said Assemblyman Louis D. Greenwald (D., Camden), who is sponsoring the bill. "This blame does not rest with you, but it does rest with the people in this room and the union leadership over the years who have allowed us to avoid this crisis."

Assemblyman John Wisniewski (D., Middlesex), the state Democratic chairman, criticized the scope of the bill, saying the easy provision to fix pensions was coupled with a "repugnant" measure to change health care that was an abrogation of collective bargaining. He said combining an unpopular measure with a more popular one was unconstitutional.

Other legislators praised Oliver.

"Your courage to move this thing forward is something I will remember all of my life," Assemblyman Joseph Malone (R., Burlington) told the speaker.

Union workers in T-shirts that championed collective bargaining lined the gallery above the Assembly floor to pass judgment on various lawmakers by calling out whether they were real Democrats or "Christiecrats."

The latter label was a jab at Democrats who have supported Christie in his drive to have government employees pay more for benefits.

Larry Cohen, president of the Communications Workers of America, issued a statement after the vote saying New Jersey had stepped back 50 years, "stripping bargaining rights from public workers and imposing health-care cuts that will destroy living standards for hundreds of thousands of families."

The session was the culmination of a tense and restless day in the Statehouse, in which Senate Democrats met for hours to tangle over the fiscal 2012 budget. The budget must be signed by the governor by next Thursday to avoid a possible government shutdown.

Sweeney announced Thursday that the Democrats would introduce their own budget next week to restore money slashed in the proposal Christie made in February.

He said Democrats also would introduce a bill to increase the income tax on the 16,000 New Jerseyans who earn more than $1 million. The measure would yield an average of $40,000 in additional tax from each millionaire.

Christie has repeatedly vowed to veto such a bill.

Taxes would not be increased for anyone else under the Democrats' plan, Sweeney said, and more money would be found in the $800 million that Democrats estimate will come from higher-than-anticipated state revenue.

Every school district in the state would get extra money under the Democrats' budget, not just the poor districts for which the state Supreme Court ordered $447 million more last month. The Democrats would spread an additional $1.1 billion to districts statewide.

The Democrats' budget also would call for more money for family planning clinics, Medicaid, tax breaks for senior citizens and the working poor, police departments in more than 100 high-crime municipalities, Urban Enterprise Zones that stimulate business in cities, psychiatric hospitals, and legal services for the poor.

The approximately $30 billion budget "recognizes the principles of the people in this state that do care about the middle class and the poor," Sweeney said.

There is also money to keep New Jersey Network on the air for several weeks if the Democrats reject Christie's plan to turn operations of the network over to a New York public broadcasting entity.

Sweeney said the Democrats' budget was not a political giveback to the party's core constituencies, many of whom feel betrayed by his support of the governor's pension and health-benefits bill.

Sweeney has been a target of public workers, thousands of whom staged their third rally in eight days outside the Statehouse Thursday.

Union leaders vowed to seek revenge in the November elections against legislators who they said had betrayed them, and several signs portrayed Christie and Sweeney as union-busting coconspirators.

"We didn't come looking for a fight, but believe me, if you attack us, you're going to have a fight!" yelled Barbara Keshishian, president of the New Jersey Education Association, the state's largest teachers' union.

"We will fight today, we will fight this summer, and you better believe we will fight in November."

After the vote, about 10 p.m., Christie met with Sweeney and Greenwald in his office. Friday morning at 7:05, he was expected to take a victory lap in an appearance on NBC's Today.

Pensions

Increases the salary that public employees contribute toward their pensions. Everyone in the state pension plan is assessed an additional 1 percent of salary immediately; an additional increase will be phased in for some workers. Teachers' contributions go from 5.5 percent to 6.5 percent of salary now and will rise an additional percentage point over seven years. Police and firefighters' contributions rise from 8.5 percent to 10 percent immediately. Judges' contributions go from 3 percent to 12 percent over seven years.

Suspends cost-of-living increases on pensions.

Raises the retirement age from 62 to 65 for new hires. Workers hired before 2008 may retire at 60. Police and firefighters may retire after 25 years.

Increases the years of service that new hires other than police and firefighters need to retire early from 25 to 30.

Leaves intact a 9 percent enhanced pension benefit granted by the Legislature 10 years ago.

Creates labor-management boards that can restore cost-of-living adjustments, modify pension contribution rates, and change the retirement age once the funds' assets can cover 80 percent of their eventual liability.

Requires the state to start making its annual payment to the pension system, phased in over seven years. A one-seventh contribution due in the coming fiscal year is $506 million.

Health care

Requires public workers to pay a portion of their health-care premiums based on income. Employees earning $60,000, who now pay $900 (1.5 percent of salary) toward health insurance, will annually pay about $2,000 (3.4 percent of salary) for single coverage or about $3,200 (5.4 percent of salary) for a family plan after a four-year phase-in.

Continues free health care for current retirees and those with at least 20 years of service now when they retire after working at least 25 years.

Allows collective bargaining over health care to resume in four years.

SOURCE: Associated Press