Christie warns again about public pension system

WASHINGTON - Gov. Christie said Thursday that he had worked to make New Jersey more affordable during his tenure but warned that growing costs of retiree benefits were crowding out spending for services such as education and health care.

Christie's speech came as he prepares to deliver his annual budget address Tuesday to the Democratic-controlled Legislature.

"We will continue to resist a tax system in New Jersey which is unfair to our citizens," Christie said at the Marriott Wardman Park hotel. His speech was part of the New Jersey Chamber of Commerce's 78th annual "Walk to Washington."

He said the state had added about 150,000 private-sector jobs since he took office in 2010 and was spending less than it did in fiscal year 2008, not including pensions, health benefits, and debt service.

New Jersey's economy has lagged the nation's and the region's, creating fewer jobs than in Pennsylvania and New York since the end of the recession in 2009.

Christie pointed to Mercedes-Benz's announcement last month that it would move its U.S. headquarters from Montvale, N.J., to Georgia as evidence that the state had a hostile business climate.

Despite his vetoing of surcharges on the corporate business tax, Christie said, "we still have a corporate citizen who was here for 40 years, leaving."

Christie, a Republican considering running for president in 2016, did not telegraph his national ambitions. But he continued to rail against the pension system for New Jersey's public workers, an issue that helped raise his national profile during his first term.

He has yet to propose further changes but has commissioned a panel to study the pension system, which has an unfunded liability of between $37 billion and $82 billion, depending on the accounting method used to calculate it.

"What we need to do going forward is to avoid, if we can, confrontation on this issue, and to reach out and cooperate," Christie said.

Of the unions, he said: "Ultimately this is as much their problem as it is our problem."

Unless state leaders and unions find the "spirit of compromise" in fixing the pension system, the costs will crowd out "every other type of spending we want to do," Christie said.

Public-sector unions are challenging Christie's actions in court.

A state judge heard arguments last month in a lawsuit brought by public-sector unions alleging that Christie violated a contract in June when he cut the payment to the pension system for public workers from $2.25 billion to $681 million.

Unions are asking the judge to force Christie to make the full payment - a ruling that would open a gaping hole for the fiscal year that ends June 30 and affect spending for the next fiscal year.

Christie on Thursday did not address another thorny problem he faces this budget cycle: how to replenish the state's depleted fund for transportation projects. The fund is set to run out of money next fiscal year. Lawmakers, as well as a coalition of business and labor leaders, warn that infrastructure will continue to crumble and the state will lose business if it does not raise new revenue for transportation.

Democrats have signaled support for raising the state's 14.5-cent-per-gallon tax on gasoline. Christie has said only that all options are on the table for replenishing the fund.

The governor will be in Washington again Friday for the Republican Governors Association's winter meeting.

Also speaking at the chamber event were U.S. Reps. Frank Pallone (D., N.J.), Tom MacArthur (R., N.J.), and Donald Norcross (D., N.J.).

Earlier Thursday, hundreds of New Jersey elected officials, lobbyists, and business and labor leaders boarded a train to Washington, networking and schmoozing over drinks.

During one colorful exchange, two presumptive gubernatorial candidates in 2017 - Assemblyman Jon Bramnick (R., Union) and Philip D. Murphy, a former U.S. ambassador to Germany - crossed paths on the train and said each looked like a governor.