Pension and Health Benefit Reform

• In order to address the State’s economic and fiscal challenges, Senator Sweeney created a bipartisan panel comprised of a diverse group of fiscal experts with experience in both the public and private sectors. The group studied ways in which state and local governments and school districts can operate more efficiently and address escalating costs.
  
• The panel worked to identify ways to address soaring pension and benefit costs, hold down property taxes, make State and local government and school districts more efficient, assess the equity and efficiency of our state and local tax structure, leverage the value of state assets, and mitigate the negative impact of federal tax law that targeted high-cost states. The group reported its findings and recommendations in the Path to Progress report.
  
• The report’s recommendations are common-sense solutions designed to address the ongoing structural deficit. They take a measured approach that will provide billions of dollars in savings for the State budget, local and school budgets, government employees, and taxpayers.
  
• Among the many proposed changes, the report recommends shifting certain new State and local government employees and those with fewer than five years of service from the current defined benefit pension system to a sustainable hybrid system that has both a defined benefit and a 401(k) retirement account. It also recommends transitioning public employee health plans from Platinum to Gold, specifically a Gold plan that pays 80% of the employee’s health care costs.  Please visit the Path to Progress website at www.pathtoprogressnj.org to learn more.
  
• Senator Sweeney also authored legislation requiring the State to pay its pension contributions on a quarterly basis by September 30, December 31, March 31, and June 30 of each year. Requiring quarterly payments will improve the long-term health of the fund by $4 billion and save taxpayers $9 billion over 30 years as a result of additional investment income earned throughout the course of each year.
  

Capping and Controlling Property Taxes

• Senator Sweeney worked to enact the 2% property tax cap in 2010, which is the most stringent cap ever enacted in New Jersey. This cap law limits the amount by which property taxes may be raised annually and also eliminates a number of exemptions that were allowed under the previous cap law.

  

• Senator Sweeney has pursued many innovative efforts toward shared services between counties and municipalities as a means for alleviating the budgetary concerns currently experienced by many communities, including previously introducing legislation that would eliminate government inefficiencies by creating fiscal consequences for local government entities that refuse to enter into sharing agreements that could help their property taxpayers.
  
• Senator Sweeney’s school funding plan, as described in the “Education” section, is designed to eliminate the extra burden on property taxpayers by compensating for inequities in current state funding to school districts. By bringing all districts to their expected funding level, municipalities will not have to look to local taxpayers to make up deficiencies.
  

Tax Relief for Seniors and Veterans

• Senator Sweeney, Assemblyman Burzichelli, and Assemblyman Taliaferro have consistently supported measures that will bring targeted tax relief to seniors and honorably discharged veterans, making it more affordable to stay here in New Jersey. This tax relief means that veterans, retirees, and seniors will be encouraged to remain in New Jersey, as will their beneficiaries, keeping their spending within the State as well.

  

• These changes include: increasing the income tax exemption on retirement income from $20,000 to $100,000; eliminating the estate tax; enacting a $6,000 income tax deduction for all honorably discharged veterans; and increasing eligibility for the Senior and Disabled Property Tax Freeze program.