NJPSA Applauds TPAF Board Vote to Sue State for Shorting Pension Payment

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The Teachers' Pension Annuity Fund Board (TPAF), which represents the interests of those in the TPAF, including many NJPSA members, voted almost unanimously to hire outside counsel July 10 in order to pursue legal action against the State for failing to make the required 3/7 and 4/7 pension payment as required by P.L. 2010, 78.  How this action impacts the ongoing litigation filed by various unions, including NJPSA, as well as the other pension funds (i.e. PFRS) in response to the Governor’s recent decision is not clear although one could argue it bolsters the existing action of parties and adds to the furor of those calling for action to address the shortfall to the fund.  The board approved the hiring by a vote of 5-0-1. 

Mercer Assignment Judge Jacobsen ruled June 25 that the State could not be compelled to make the full payment required by enactment of P.L.2011, c.78 in light of the State’s dire fiscal situation (Round 1: Court Rejects Emergent Relief Application to Force the State to Comply with the Pension Contributions in Accordance with Chapter 78, June 26, 2012).  But, Judge Jacobsen also affirmed the employees’ contractual right to their collective pensions and sent the matter back to the trial court to determine the fiscal impact on the State should the payment be compelled for the now current fiscal year.

“We are pleased that the TPAF Board voted to take this necessary step toward joining the litigation filed by the many organizations impacted by the Governor’s actions,” said Dan Higgins, director of communications for NJPSA. “Their participation will strengthen our collective efforts to force the Governor to meet his obligation to make the state’s contributions to the pension funds in accordance with the payment schedule he had agreed to. Our members are living up to our end of the bargain by increasing our payments into the fund. It is time that the Governor does the same.”

NJPSA will keep you posted as this matter moves forward.  NJPSA is committed to working with the other public unions and professional associations to protect the pension fund and pensioners as well as future retirees by seeking the full legal remedies available to enforce the State’s obligation to make the necessary contributions in accordance with Chapter 78.