The Associated Press June 15, 2011, 12:24PM ET

NJ budget panels to take up benefits bill

The leader of the New Jersey Assembly has agreed to post a bill requiring all public workers to pay more for health care and pension benefits for a hearing, despite an initial reluctance to move the measure forward without a majority of Democrats backing it.

Assembly Speaker Sheila Oliver said Tuesday it was important to get public debate under way, but she's not committed to putting the bill up for a full Assembly vote. It will be heard by the Budget Committee on Monday.

Oliver's announcement came the day after former Assembly majority leader Bonnie Watson Coleman urged colleagues in a strongly worded letter to stand up for core Democratic principles. Watson Coleman said her party should unite in opposition to Republican Gov. Chris Christie's policies, starting with a refusal to vote on any legislation that infringes on collective bargaining.

"It now pains me to see how we have been strategically and systematically manipulated to compromise the value of our majority in support of this governor's agenda," she wrote. "How are we allowing ourselves to be dragged down this governor's right-wing alley of pain and devastation that is targeting the middle class, frail, elderly and poor, and support an agenda that upholds and indeed lifts the wealthiest?"

A copy of the letter was obtained by The Associated Press.

Watson Coleman, a 13-year veteran of the Assembly, said the letter was meant to "jar the collective consciousness of my caucus." She declined further comment.

Oliver said she's still hoping to build a consensus, and views amendments to the bill as likely.

Public worker unions want health coverage to be negotiated as it is now, not legislated. Many Democrats in the Legislature agree. The unions are planning a rally at the Statehouse on Thursday, when the proposal gets its first public hearing before a Senate budget panel.

"This is an attack on collective bargaining," said Anthony Wieners, president of the state Policemen's Benevolent Association. "Health benefits are negotiated between local union members and local governments. To strip that away is fundamentally undemocratic."

As of now, a majority of Democrats do not support the bill. But there are enough votes to muscle it through if Sweeney and Oliver, both Democrats, are willing to rely on the Republican minorities in both houses.

Incorporating a sunset provision that would reinstate negotiations over health care after four years swayed almost no one.

There is agreement on the need to raise workers' pension contributions to keep the system solvent.

Christie supports legislative changes to health insurance and pension contributions. He's counting on saving $323 million through health benefits reforms for the budget year that begins July 1. The largest public worker union, the Communications Workers of America, has made its own health giveback proposal, which the union said would save taxpayers $200 million.

Earlier Tuesday, more details about Senate President Stephen Sweeney's proposal emerged.

Sweeney, the driving force behind the legislation, said the health care proposal would require public workers to pay 5 to 6 percent of their salaries for the most expensive family coverage after being phased in for four years. Workers now contribute 1.5 percent of their salaries toward health insurance.

Retirees' health care wouldn't change under Sweeney's plan. Employees with at least 21 years of service would see a less dramatic health insurance increase.

All government workers would see their pension contribution increased by at least 1.5 percent of their salaries. Teachers and state and local government workers would be assessed 1 percent more immediately and another 1 percent phased in over seven years. Judges, who now contribute 3 percent of salary toward retirement benefits, the lowest of any public worker group, would see that number rise to 12 percent after seven years.

Automatic cost-of-living increases would be eliminated for pension recipients, but pension management boards could restore the perk once the retirement funds become less indebted. The retirement system for state police, teachers, local police and firefighters, judges, and state, county and local government employees is 60.5 percent funded, or about $54 billion in the red. Sweeney's proposal is designed to shore it up by 10 percent immediately and by another 10 percent over the next 30 years.

The state would no longer be able to skip its annual payment to the pension system if Sweeney's bill is signed into law. Christie has proposed making a one-seventh payment of $506 million in the upcoming budget, as current law requires.


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