N.J. lawmakers wrap a Christmas pension gift for Camden Mayor Dana Redd

HOLTEC08
Camden Mayor Dana Redd speaks during a ribbon cutting ceremony in September.

Years ago, New Jersey lawmakers would insert last-minute “Christmas tree” items into the annual budget to send pork back to their districts. A federal investigation by then-U.S. Attorney Chris Christie helped scale back the Trenton tradition.

But lawmakers are back in a gift-giving mood these days, fast-tracking legislation that would sweeten pensions for the mayor of Camden and an unknown number of other elected officials.

If the measure were to become law, as seems likely, Mayor Dana L. Redd’s annual pension would increase by more than 50 percent to about $50,000.

Redd, 49, who is leaving office next month, would also be eligible for early retirement and, like other government employees who serve for 25 years, lifetime health benefits. (Public employees who retire early also have to pay a penalty.)

The legislative maneuvering comes in the same month that the Christie administration released a report warning that the pension and health benefits systems for public workers would consume 26 percent of the state budget by 2023.

Camera icon Clem Murray / Staff Photographer
Gov. Christie with Mayor Dana L. Redd in 2016.

Redd, a Democrat, has been a key ally for Christie, a Republican, and George E. Norcross III, a South Jersey insurance executive and Democratic power broker. Christie is to be succeeded by Democrat Phil Murphy on Jan. 16.

At issue is a 2007 law that prohibited newly elected officials from enrolling in the Public Employee Retirement System (PERS). After the law passed, elected officials were allowed to enroll in a 401(k)-style defined contribution plan.

Officials who were already enrolled in PERS were allowed to stay in it if they continued to serve in the same position. (An exception was carved out for legislators who moved from one chamber of the Legislature to the other.) When Redd jumped from City Council member to mayor in 2010, her account was frozen.

Lawmakers in Trenton now say that was an unintended consequence they want to fix.

“Going back and reworking these things is always awkward,” said Assemblyman John Burzichelli (D., Gloucester), chairman of his chamber’s appropriations committee. But, he added, “I look at this as housekeeping.”

Senate President Stephen Sweeney (D., Gloucester) suggested that this was a drop in the bucket for a pension system for nearly 800,000 active and retired public workers. “It has no impact on the pension,” he told reporters in Trenton.

A spokesman for Redd said the mayor was focused on the transition to the incoming administration and had no comment on “any pending legislation.” Council President Frank Moran will succeed Redd in January.

Lawmakers say the legislation could affect perhaps a handful of other elected officials. Burzichelli, whose committee advanced the legislation, said he hoped to have a list of names before the Assembly’s next voting session, scheduled for Jan. 4.

The nonpartisan Office of Legislative Services said it was unable to estimate the cost of the bill.

Under legislation that passed the Senate and Burzichelli’s Assembly committee on Monday, Redd would be able to buy back into the pension system and get retroactive service credit for the years her account was frozen.

Her pension would be based on her $102,000 salary as mayor, up from the $92,596.66 three-year average from her highest-earning years as a Camden County employee and City Council member in the mid-2000s, according to the Treasury Department. She enrolled in PERS in 1990.

Under current law, Redd would be eligible for retirement in 2028 and receive a $32,408.88 annual pension, according to the Treasury. The new legislation would boost her pension to more than $50,000.

Previous versions of the bill have failed. In 2014, for example, lawmakers unsuccessfully tied the pension-fix bill to raises for cabinet officials, judges, and various other public officials.

But there’s broad support this time around in the Democratic-controlled Legislature. The bill passed the Senate by 23-9 and advanced from the Assembly committee by 8-2, with one abstention.

CorrectionA previous version of this article incorrectly stated that New Jersey government employees who serve for 25 years are eligible for free lifetime health benefits upon retirement. A 2011 law signed by Gov. Christie required most new retirees to contribute at least 1.5 percent of their monthly retirement allowance toward their health care, though there were exceptions for workers who had already accrued 25 years of service credit.