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New Jersey Report: Path to Progress

December 26, 2018
By New Jersey Economic & Fiscal Policy Workgroup

New Jersey faces a fiscal crisis due to public employee pension and benefit costs.

The New Jersey Legislature created the Economic and Fiscal Policy Workgroup and charged it with a broad mission—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 the federal tax law that targeted high-cost states.

Among the Workgroup’s recommendations is to shift new state and local government employees and those with less than five years of service in the Public Employees’ Retirement System and the Teachers’ Pension and Annuity Fund from the current defined benefit pension system to a sustainable hybrid system and preserve the current system for employees with over five years of service who have vested contractual pension rights.