| Governor Chris Christie • Lt.Governor Kim Guadagno | ||||||||||||||
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PENSION AND HEALTH BENEFITS REVIEW COMMISSION The
following meeting dates have been scheduled at 10:00 AM in the 1st
floor board room at the
Meeting Agendas
View Pension and Health Benefits Review Commission Meeting Agendas from
Vote Results
View Pension and Health Benefits Review Commission Vote Results from
The Pension and Health Benefits Review Commission will meet on Friday, December 9, 2005 at 10:00 AM in the first floor board room of the Division of Pensions and Benefits, 50 West State Street, Trenton. No verbal comments are accepted during the meeting. The Commission should receive written comments at least ten business days in advance of the meeting. The agenda is as follows: A-4380 (Cohen) S-2712 (Asselta)/A-854(Barnes/Steele) A-2253 (Wisniewski/Scalera) A-1899 (Oliver) A-1825 (Manzo) A-2819 (Cohen) A-4337 (McHose) S-2518 (Adler) A-333 (Weinberg/Johnson/Previte) A-3974 (Van
Drew) A-887 (Diegnan/Barnes) The Pension and Health Benefits Review Commission will meet on Friday, September 16, 2005 at 10:00 AM in the first floor board room of the Division of Pensions and Benefits, 50 West State Street, Trenton. No verbal comments are accepted during the meeting. The Commission should receive written comments at least ten business days in advance of the meeting. The agenda is as follows: S-2599
(Doria)/A-4164 (Panter) A-3953
(Steele)/S-2653 (Bucco/Girgenti) S-2592
(Sarlo)/A-4197 (Weinberg/Johnson) S-2572
(Bark/Palaia) A-4199
(Vas) S-2446
(Adler)/A-3952 (Cohen) A-1676
(Munoz) A-4101 (Diegnan) A-3537
(Johnson/Weinberg/Gordon/Voss) S-2471
(Kenny/Lance) The Pension and Health Benefits Review Commission will meet on Friday, June 10, 2005 at 10:00 AM in the first floor board room of the Division of Pensions and Benefits, 50 West State Street, Trenton. No verbal comments are accepted during the meeting. The Commission should receive written comments at least ten business days in advance of the meeting. The agenda is as follows: S-723 (Connors)/A-913 (Connors/Rumpf) S-114 (Inverso)/A-3717 (Merkt) A-161 (Oliver) A-2330 (Van Drew/Scalera) A-1891 (Oliver) S-377 (Asselta)/A-3586 (Conners/Johnson/Greenstein/Conaway/Van
Drew) S-544 (Vitale/ Buono) A-1606 (Fisher/Burzichelli)/S-593
(Sweeney) A-139 (Green/Malone/Watson Coleman/Munoz) A-1526 (Payne) The Pension and Health Benefits Review Commission will meet on Friday, April 15, 2005 at 10:00 AM in the first floor boardroom of the Division of Pensions and Benefits, 50 West State Street, Trenton. No verbal comments are accepted during the meeting. The Commission should receive written comments at least ten business days in advance of the meeting. The agenda is as follows: S-2283 (Gill)/A-3759
(Cohen)/ (Johnson)/ (Weinberg)/ (Diegnan) S-2234 (Vitale) A-3817 (Sires) S-2268 (Sarlo) S-2267 (Sarlo) S-2233 (Madden)/(Sweeney) S-2231 (Madden)/(Sweeney) S-2122 (Doria) A-3739 (Rooney) A-3692 (Conners) A-3294 (Van
Drew) A-3753 (Chiappone) The Pension and Health Benefits Review Commission will meet on Friday, February 18, 2005 at 10:00 AM in the first floor boardroom of the Division of Pensions and Benefits, 50 West State Street, Trenton. No verbal comments are accepted during the meeting. The Commission should receive written comments at least ten business days in advance of the meeting. The agenda is as follows: A-1587 (Burzichelli) A-2454
(Cohen) A-2457
(Cohen) S-1812
(Doria)/(Kenny) S-2074
(Allen)/A-926 (Connors)/(Rumpf) A-2244
(Wisniewski)/(Diegnan) A-3607
(Cohen) A-1705
(Munoz)/S-455 (Kean) A-2364
(Mayer)/(Malone) S-1967
(Baer) S-230
(Singer)/(Inverso) A-3529
(Van Drew) VOTE RESULTS A-1587 (Burzichelli) Motion: To recommend against enactment because it may complicate the delivery of prescription drug plan services and there is a potential cost associated with the bill. Discussion: The enactment of this bill may restrict the implementation of future cost containment measures such as step therapy. The State Health Benefits Program (SHBP) applies step therapy when two drugs are covered under the formulary and the less expensive, efficacious drug may be tried first. Eliminating step therapy will have a significant financial impact to the SHBP, which has been striving to contain costs in the drug program. A-2454 (Cohen) Motion: To recommend against enactment because it continues the questionable practice of legislating health benefit mandates, which increase health benefit costs. Discussion: The bill continues the questionable practice of legislating health benefit mandates, which generally tend to place the health insurance industry outside the "free enterprise" system and drive up the cost of health insurance for both employer provided coverage and individual policies. The continued enactment of health benefit mandate legislation will soon make coverage unaffordable for both. A-2457 (Cohen) Motion: To recommend against enactment because it continues the questionable practice of legislating health benefit mandates which increase health benefit costs. Discussion: This bill is not the proper fix to address the much larger health care problems. Legislation that continues to mandate health benefits generally drives up the costs of health insurance for both employer provided coverage and individual policies. The enactment of health benefit mandates will soon make coverage unaffordable for both. S-1812 (Doria)/(Kenny) Motion: To recommend against enactment because the waiver programs are inconsistent and creates disparity among local employers. Discussion: The adoption of the waiver programs has occurred in a piecemeal and inconsistent fashion. Counties with health care coverage from non-SHBP sources can already offer the waiver program. The enactment of this bill would extend the local employee health care waiver program already allowed for other public entities to counties in the SHBP, and any board, agency or instrumentality of a county of municipality. Since the enactment of Chapter 259 P.L. 1995 which allowed only municipalities to offer cash incentives to waive SHBP and non-SHBP coverage to its employees if the employee had coverage as a dependent of a spouse only 149 out of 620 non-school board local employers that participate in the SHBP elected to allow the waiver of coverage. S-2074 (Allen)/A-926
(Connors)/(Rumpf) Motion: To recommend against enactment since the bill creates disparity among the other State-administered pension systems. Discussion: The existing purchase laws are already generous in their purchase provisions. The law regarding the purchase of temporary service is currently consistent in all the State retirement systems in that, for the service to be purchasable, the service must have led without interruption to a permanent or regular appointment with an employer. This bill would allow a PFRS member to purchase temporary service that did not lead to a permanent appointment, making the PFRS temporary service purchase provisions more liberal than the other retirement systems. Although the bill specifies full cost of the purchase to be borne by the member, the cost of the purchase does not include the costs associated with health benefits when retired with 25 or more years of service credit or the cost associated with future cost-of-living increases (COLA). A-2244 (Wisniewski)/(Diegnan) Motion: To recommend against enactment because the bill is precedent setting and would create a disparity in the purchase of service provisions. Discussion: The purchase provisions that already exist in all the State-administered
retirement systems are considered very liberal. The types of service
available for purchase have been consistent in all the major State-administered
retirement systems. This bill would be precedent setting in that,
it would be the first time non-public employment would be purchasable
for service credit in a New Jersey State administered pension plan.
Although, the bill specifies that the full cost of the purchase
would be borne by the member, more than likely the additional years
of service acquired may make the member eligible for free health
benefits when retired with 25 or more years of service credit. The
cost would be the responsibility of the employer. Also, the cost
associated with future cost-of-living increases (COLA) has not been
considered part of the purchase costs. Motion: To recommend against enactment because it would create disparity in the purchase of service credit provisions and the costs associated with ancillary benefits are not included in the full actuarial costs. Discussion: The purchase provisions that already exist in all the State-administered retirement systems are considered very liberal. The types of service available for purchase have been consistent in all the major State-administered retirement systems. This bill would liberalize the purchase of service credit provisions only for members of the TPAF by allowing the purchase of vested out of State service, thereby creating a disparity in the purchase of service credit provisions when compared to the other State-administered retirement systems. Although, the bill specifies that the full cost of the purchase would be borne by the member, more than likely the additional years of service acquired may make the member eligible for free health benefits when retired with 25 or more years of service credit. The cost would be the responsibility of the employer. Also, the cost associated with future cost-of-living increases (COLA) has not been considered part of the purchase costs. A-1705 (Munoz)/S-455
(Kean) Motion: To recommend against enactment as this bill is special legislation and would create a disparity in the PFRS enrollment provisions as they apply to firemen employed by a municipality, county, or the State. Discussion: State law regarding membership in the PFRS restricts enrollment to police and firemen age 35. The law provides the following exceptions: eligible periods of military service during periods of conflict may be used to reduce age and any former State trooper, sheriff's officer, deputy sheriff's officer or county or municipal policeman is permitted to use previous service as a police officer to reduce actual age in order to meet maximum requirement of 35 years for the position of a municipal police officer. Municipal laws restrict the appointment of personnel to a municipal police or fire department to individuals age 35 and under. No existing law provides similar age restrictions when police and fire personnel are appointed on a county or State level. The PFRS age restriction, however, appointed officers on a county and State level are required to join PERS. If this bill is enacted, a PFRS enrollment disparity would be created because certain municipal firemen hired over the age of 35 would be allowed enrollment in the PFRS and their counterparts employed on a county or State level would not. Since this bill only applies to firefighters appointed between July, 1998 and July, 1999 it is clearly special legislation. A-2364 (Mayer)/(Malone) Motion: To recommend against enactment based on the increase in employer pension costs. Discussion: To be eligible for membership in the TPAF, an otherwise qualified individual must be a "full-time" employee. Membership in the PERS, however, is based primarily on the employee receiving an annual salary of no less than $1,500. Therefore, PERS membership includes part-time and even temporary employees whose salaries are limited due to less than full-time service and whose pensions would be correspondingly lower than their full-time counterparts. Nothing would preclude these individuals from receiving minimum pensions as defined in this bill. The enactment of this bill would result in an increase in the unfunded accrued liability for PERS and TPAF of $205 ml. S-1967 (Baer) Motion: To recommend against enactment because bill would permit adverse selection against the retirement system as a result of ABP poor investment performance. Discussion: The bill promotes adverse selection, since the only ABP members that would elect to transfer would be those that stand to gain an increased pension by transferring back to TPAF or PERS. Sections 2.a and 2.b of the bill defines how funds would be transferred from the APB investment provider to the defined benefit plans. It would have 5/13ths of the amount moving from the ABP account to the member's annuity savings fund balance. The other 8/13ths of the fund would go to the contingent reserve fund, representing the employer contributions. Although, the total contributions of the transfer equal 13%, (5% employee and 8% employer funded) the contingent reserve fund is shorted because of poor investment performance on the part of the ABP member, resulting in an unfunded liability payable by the State. S-230 (Singer)/(Inverso) Motion: To recommend enactment and request clarification as to whether the National Guard would be included under the bill. Discussion: Statutory provisions are already in place giving special veterans' preference to pension system members who were involved in certain military campaigns. Originally, the pension laws provided special pensions to qualified members involved in military campaigns up to and including the Korean conflict. These laws were amended periodically to extend these preferences to individuals involved in other military campaigns such as the Vietnam conflict, Operation Desert Shield/Desert Storm, Operation Restore Hope and others. Most recently, P.L. 2003 c. 197 was enacted providing veterans' preference to veterans of Operation Enduring Freedom and Iraqi Freedom. Consequently, this bill is not precedent setting. If enacted, this bill would increase State and local employer pension costs. A-3529 (Van
Drew) Motion: To recommend against enactment because workers compensation and disability pension should be integrated so that members would not receive more than 100 percent of active salary, this would serve as a disincentive to return to work. Discussion: The enactment of this legislation, as written, would impact the size of workers' compensation awards issued to State workers who are also granted an ordinary disability pension from one of the State-administered plans. This bill may preclude the State's current practice of offsetting of workers' compensation awards if the State employee receives an ordinary disability pension from a State plan for the same injury. Pursuant to P.L. 1995, c. 369, accidental disability pensions from a State administered pension plan are offset dollar-for-dollar for any member who simultaneously receives a workers' compensation award based on the same injury. No pension law allows for the same offset for ordinary disability pensions, however, the Division of Workers' Compensation in the Department of Labor has continued to offset workers' compensation awards for State workers who are granted an ordinary disability pension. The enactment of this bill would preclude any such offsets.
BILL: S-2283 (Gill)/A-3759 (Cohen)/ (Johnson)/ (Weinberg)/ (Diegnan) Motion: To recommend against enactment since Cobra coverage can extend health benefits coverage for an additional 36 months for dependents. Discussion: Extending health benefits coverage to age 30 for dependents is much too generous a benefit since Cobra coverage can provide dependents with an additional 36 months worth of coverage. Under current SHBP regulations, dependent children are covered until the end of the year in which they turn age 23, or older if physically and/or mentally disabled. Cobra can provide dependents with an additional 36 months worth of health benefits coverage, which would allow the dependent coverage until age 26. BILL: S-2234 (Vitale) - Allows participation in SHBP for certain union elected officers and employees. Motion: To recommend against enactment since the bill may jeopardize the SHBP's ERISA exempt status. Discussion: As a government plan, the SHBP currently enjoys an exemption from ERISA's provisions. Welfare plans sponsored by private-sector employers are not. Enrollment of private sector employees into the SHBP, as proposed by this bill, could jeopardize the SHBP's ERISA exemption and thereby threaten the tax-exempt status of employer provided SHBP coverage. A similar bill in the 2002-2003 legislative session was vetoed by Governor McGreevey. BILL: A-3817 (Sires) - Allows participation in SHBP for elected officers and employees of union representing State employees. Motion: To recommend against enactment since the bill may jeopardize the SHBP's ERISA exempt status. Discussion: As a government plan, the SHBP currently enjoys an exemption from ERISA's provisions. Welfare plans sponsored by private-sector employers are not. Enrollment of private sector employees into the SHBP, as proposed by this bill, could jeopardize the SHBP's ERISA exemption and thereby threaten the tax-exempt status of employer provided SHBP coverage. A similar bill in the 2002-2003 legislative session was vetoed by Governor McGreevey. BILL: S-2268 (Sarlo) - Provides retirement benefit under Judicial Retirement System of 75 percent of final salary to certain judges with at least 10 years of judicial service. Motion: To
recommend against enactment since a Judicial Retirement System pension
enhancement is Discussion: The enactment of this bill would increase State pension cost and encourage the consideration of other legislation proposing further enhancements to the State-administered pension plans. BILL: S-2267
(Sarlo) Motion: To recommend against enactment since it would increase local employer
pension costs and Discussion: Chapter 257, P.L. 1955, established the Law Enforcement Officer (LEO) category as a special group of the PERS. The Leo group is eligible for enhanced retirement benefits not available to regular PERS members. Individuals who do not meet the age or medical requirements for entry into the PFRS as a result of employment in titles specifically defined by law are eligible to participate in the LEO category or as a regular member of PERS. The enactment of this bill would increase the unfunded liability in the pension system by an additional $25,000 per individual. BILL: S-2233 (Madden)/(Sweeney) - Provides for certain ex-spouses of retirants to receive pension under SPRS. Motion: To support the concept of the bill but recommend that the sponsors amend it to become more cost neutral. The Division of Pension and Benefits will work with the bill sponsors to craft a more equitable approach. Discussion: Regulations regarding Qualified Domestic Relation Orders (QDRO's) allows for a court ordered division of a member's pension benefit between the retiree and an ex-spouse in the case of divorce. The pension benefit would remain with the ex-spouse until death and the qualified widow as defined by the current provisions of law would be entitled to the survivor's benefit at the time of the retiree's death. Currently, QDRO's do not apply to government plans. A court order could divide a State retirement system member's pension benefit between the retiree and an ex-spouse, but it would not apply to the survivor's benefit. The pension benefit to both retiree and ex-spouse begins at retirement and ceases at the time of the retiree's death. A more amicable solution may be to separate the member's benefit and with some actuarial adjustment for differences in ages, award the ex-spouse as part of the divorce decree a separate benefit payable as long as the ex-spouse is living and not to cease upon the death of the retired member. Legislation could be drafted that would allow the an actuarial adjustment to the pension payable to the retired member and the ex-spouse, which would result in a lifetime benefit payable to the ex-spouse, while keeping the bill cost neutral. BILL: S-2231
(Madden)/(Sweeney) Motion: To support the concept of the bill but recommend that the sponsors amend it to become more cost neutral. The Division of Pension and Benefits will work with the bill sponsors to craft a more equitable approach. Discussion: Regulations regarding Qualified Domestic Relation Orders (QDRO's) allows for a court ordered division of a member's pension benefit between the retiree and an ex-spouse in the case of divorce. The pension benefit would remain with the ex-spouse until death and the qualified widow as defined by the current provisions of law would be entitled to the survivor's benefit at the time of the retiree's death. Currently, QDRO's do not apply to government plans. A court order could divide a State retirement system member's pension benefit between the retiree and an ex-spouse, but it would not apply to the survivor's benefit. The pension benefit to both retiree and ex-spouse begins at retirement and ceases at the time of the retiree's death. A more amicable solution may be to separate the member's benefit and with some actuarial adjustment for differences in ages, award the ex-spouse as part of the divorce decree a separate benefit payable as long as the ex-spouse is living and not to cease upon the death of the retired member. Legislation could be drafted that would allow the an actuarial adjustment to the pension payable to the retired member and the ex-spouse, which would result in a lifetime benefit payable to the ex-spouse, while keeping the bill cost neutral. BILL: S-2122 (Doria) - Permits transfer of service credit among State-administered retirement systems; permits use of ABP credit for TPAF and PERS benefits. Motion: To recommend enactment only if the bill sponsor reviews the language
of the bill with the Division Discussion: The bill would give ABP members similar transfer opportunities equal to those members of the other State-administered retirement systems by allowing them to use their public service in an ABP covered position to meet certain eligibility thresholds if they transfer to a position covered by another State plan. The Commission, however, stated that the ABP service should not qualify the member for a higher service pension in PERS or the TPAF, and that the bill should be amended to make this clear. BILL: A-3739 (Rooney) - Allows police chief member of PFRS to serve until age 70 upon approval by municipal governing body. Motion: To recommend enactment because of the institutional knowledge and experience these individuals possess. Discussion: The bill sponsor, Assemblyman Rooney addressed the Commission stating the position of police chief is primarily administrative and the physical rigors of the job are less than for other police officers. The knowledge and experience these individuals possess are often difficult to replace, which places a hardship on the municipality. The bigger issue may be to study the mandatory retirement age in general for all members since adults are living longer and leading more active and productive lives. BILL: A-3692 (Conners) - Extends payment of accidental death benefit in PFRS to survivors of certain members of reserve component of Armed Forces and National Guard. Motion: To recommend enactment only if the Division of Pensions and Benefits meets with the bill's sponsor to clarify the distinction between the State National Guard and when they are federalized during times of conflict. The bill should also be amended to include all retirement systems. Discussion: The bill should be amended to clarify the distinction between the National Guard and the reserve component of the armed forces. The National Guard are state employees until they are federalized and the armed forces are federal employees. There should also be consideration as to the benefits payable from Federal and State as a result of death while in active service. The bill does not provide any offset for those other benefits. BILL: A-3294 (Van Drew) - Reinstates PFRS and SPRS accidental death benefits to certain surviving spouses who remarried. Motion: To
recommend enactment since prior legislation has been enacted to
reinstate the accidental death benefits to surviving spouses who
remarried after September 12, 2003. BILL: A-3753 (Chiappone) - Provides for mandatory forfeiture of retirement benefits of elected official convicted of crime involving office held. Motion: To recommend enactment with amendments to clarify that only the service credit in the pension system where the member held public office will be forfeited. Discussion: Assemblyman Chiappone addressed the Commission to solicit support for this legislation. As written, the bill's provisions are vague and require clarification. The bill's language should be amended to clearly state that only the pension credit that is associated with the public office will be forfeited from the pension system. Also, the bill should include mandatory forfeiture of service credit in the Alternate Benefits Program (ABP) if a member is convicted of a crime while employed in an educational institution.
BILL: S-723 (Connors)/A-913 (Connors/Rumpf) Motion: To recommend against enactment since this bill would create an inequity as to how the cost of living benefits are determined for all public employees. The Commission recommends that proposed legislative changes to pensions or health benefits be referred to the Benefits Review Task Force. Discussion: The Benefits Review Task Force has been established by Executive Order 39, effective May 25, 2005 and is charged with the review of current laws, regulations, procedures and agreements governing the provisions of employee benefits to State and local government workers; will analyze the current and future costs of the benefits; compare the level of benefits; recommend changes to the laws, regulations, procedures and agreements designed to control the costs of such benefits to the State's tax payers while ensuring the State's public employees a fair and equitable benefits system; and will issue a report to the Governor within six months of the effective date of the Executive Order. This bill as written would increase
the disparity in benefits which currently exists between retired
policemen and firemen and other public employees. Enactment of this
bill would increase the State and local pension costs by an estimated
$138 million. Motion: To recommend against enactment since bill will not eliminate certain pension abuses and may be unfair to certain public employees. Discussion: The intent of this bill is good in that it attempts to address the problem of multiple positions under the PERS and the potential for high retirement benefits from a few years of covered employment at high salaries and many years of covered service at lower salaries. However, it addresses the problem in a manner that may promote pension abuse and may adversely affect a number of regular PERS members who have multiple positions and must choose to be enrolled only on the basis of one position. The Commission recommends that proposed legislative changes to pensions or health benefits be referred to the Benefits Review Task Force. BILL: A-161 (Oliver) Motion: To recommend against enactment since additional State and local employer pension costs will result. Discussion: The provisions of
this bill are enhancements to the benefit structure of the TPAF
and PERS. The aggregation of service credit under this bill may
allow for a greater pension than a member would be allowed under
current pension law. Enhancements to the benefit structure of the
pension system will have some additional financial impact. The Commission
recommends that proposed legislative changes to pensions or health
benefits be referred to the Benefits Review Task Force. Motion: To recommend against enactment since additional State and local employer pension costs will result and a benefit increase cannot be justified at this time. Discussion: The additional pension costs associated with this bill are estimated to be over $648 million and would serve to further erode the plan's funded status and increase required employer pension contributions. The 104 percent funded level specified in P.L.2003, c. 108 which would precipitate the increased pension for active PFRS was predicated on the fact that at a 104 percent funded level sufficient excess assets would exist in the pension fund to offset the additional pension liabilities. It is estimated that including PFRS retirees in the benefit increase as proposed by this bill, a 107.2 percent funded level would be required in order for this legislation to be cost neutral. The Commission recommends that proposed legislative changes to pensions or health benefits be referred to the Benefits Review Task Force. BILL: A-1891 (Oliver) Motion: To recommend against enactment since it would further liberalize already generous purchase provisions and creates purchase disparity among the retirement systems. Discussion: The bill only applies to PERS and TPAF which would create further disparity among the pension funds. Although it provides that the purchase will be full cost to the member, future cost of living adjustment (COLA) payable on the increased pension resulting from the purchase is an employer liability and equates to approximately 20% of the total cost of the purchase. These purchase costs do not reflect the cost of post-retirement medical benefits which are often the reason such purchases are made. The State and local employers who participate and make contributions to the pension systems will be impacted. The Commission recommends that proposed legislative changes to pensions or health benefits be referred to the Benefits Review Task Force. BILL: S-721 (Connors) Motion: To recommend against enactment since New Jersey already provides very favorable veteran benefits and expanding the number of public employees that would qualify for special veteran's benefits would result in significant additional State and local employer costs. Discussion: It is estimated that an additional 144,000 individuals would qualify to receive veteran's preference in New Jersey as a result of the enactment of this bill. The number of current pension system members expected to be reclassified as veterans is estimated to be over 11,000. The additional pension liabilities for State and local employers would be $17 million in the first year and would increase to $19 million by the third year. The Commission recommends that proposed legislative changes to pensions or health benefits be referred to the Benefits Review Task Force.
Motion: To recommend against enactment since New Jersey already provides very favorable veteran benefits and expanding the number of public employees that would qualify for special veteran's benefits would result in significant additional State and local employer costs. Discussion: It is estimated that an additional 163,000 additional individuals would qualify to receive veteran's preference in New Jersey as a result of the enactment of this bill. The number of current pension system members expected to be reclassified as veterans is estimated to be over 12,000. The additional pension liabilities for State and local employers would be $19 million in the first year and would increase to $21.5 million in the third year. The Commission recommends that proposed legislative changes to pensions or health benefits be referred to the Benefits Review Task Force. BILL: S-544 (Vitale/ Buono) Motion: To recommend against enactment until the Benefits Review Task Force has an opportunity to provide their recommendations regarding pension and health benefits. Discussion: The State Health
Benefits Program (SHBP) already complies with the portion of the
bill that refers to alcohol and drug addiction coverage. The Traditional
Plan and NJPLUS cover treatment for alcohol and drug addiction on
the same basis as other illnesses. The HMO's that participate in
the program also provide full coverage; however, they limit the
number of days of coverage per occurrence. If a stay reaches the
maximum, it would be reviewed to see if additional services are
medically required. The coverage for non-biologically based mental
illness is limited under the SHBP. If enacted health benefit costs
to the State and participating local employers would increase to
$14 million in the first year to over $18 million in the fourth
year. The Commission recommends that proposed legislative changes
to pensions or health benefits be referred to the Benefits Review
Task Force. Discussion: The Commission fully supports the enactment of this legislation. BILL: A-139 (Green/Malone/Watson
Coleman/Munoz) Motion: To recommend against enactment since bill is very broad and does not provide an operational definition of serious medical condition and specialized nonprescription oral and enteric nutritional formula. Discussion: The Commission could not support this bill as written since it does not clearly define serious medical condition and specialized nonprescription nutritional formula. Currently, New Jersey has mandated coverage for certain genetic metabolic and gastrointestinal diseases, such as phenylketonuria, as well as other severe intestinal malabsorption conditions. The enactment of this bill would significantly increase the SHBP costs to approximately $30 million in the first year. The Commission recommends that proposed legislative changes to pensions or health benefits be referred to the Benefits Review Task Force. BILL: A-1526 (Payne) Motion: To recommend against enactment and recommend that the Benefits Review Task Force examine this issue in their overall study of the retirement systems. Discussion: There has been a trend in both the private and governmental plans to reduce the service requirement for vesting. This is based on the trend towards viewing retirement benefits based on individual equity as compared to the concept of retirement benefits serving the purpose of replacing income at older ages when the employee can no longer work and after spending a full career with the employers. The five-year vesting over time will result in a significant increase in the number of terminated vested members with a future right to a deferred retirement benefit. The costs to the retirement systems will also increase based on the rate of member termination occurring between 5 and 10 years of service. State mandate, State pay issues will need to be addressed. The Commission recommends that proposed legislative changes to pensions or health benefits be referred to the Benefits Review Task Force.
S-2599 (Doria)/A-4164
(Panter) Motion: Recommend not to enact since it will undermine the issue of mandatory retirement and increase State and/or local employer benefit costs. Discussion: If enacted it will circumvent the rationale for requiring age limitations for public safety officers. It would also encourage future legislation further broadening exemptions to the current PFRS age restrictions. State and/or local employer benefits costs will increase. State-mandate, State-pay issues would need to be addressed. A-3953 (Steele)/S-2653
(Bucco/Girgenti) Motion: Recommend not to enact since the bill is inconsistent with the PFRS structure and will undermine the rationale for permitting age restrictions for public safety officers. Discussion: The enactment of this legislation will undermine the rationale of allowing age restrictions for public safety officers as again allowed under the Age Discrimination and Employment Act (ADEA). This bill will allow a public safety officer to work until the age of 70 in administrative positions, although the duties involved in the administrative position are not clearly defined. The bill could also restrict promotional opportunities for upcoming officers. S-2592 (Sarlo)/A-4197
(Weinberg/Johnson) Motion: Recommend not to enact since bill promotes inconsistent purchase provisions among the retirement systems. Discussion: The law regarding the purchase of temporary service is currently consistent in all the State retirement systems. In order for the service to be purchasable, the service must have led without interruption to a permanent or regular appointment with an employer. This bill would allow a PFRS member to purchase temporary service that did not lead to a permanent appointment, making the PFRS temporary service purchase provisions more liberal and inconsistent with the other State pension systems. S-2572 (Bark/Palaia)Increases eligible compensation level for enrollment in TPAF to $5,000. Motion: Recommend not to enact bill in its present form since it may create inequity in the other retirement systems. Committee suggests that the Benefits Review Task Force review this issue. Discussion: This bill as written will exempt retired TPAF members who return to employment from re-enrolling in the pension system and it would also preclude teachers hired for the first time from enrolling in the TPAF if their annual compensation was less than $5,000. If the intent is to allow TPAF members to become reemployed in a TPAF covered position without suspending their pension than perhaps legislation should be patterned after P.L. 2001, C.278 which allowed retired PERS members to earn up to $15,000 annually in a PERS covered position without requiring them to reenroll in PERS. A-4199 (Vas) Motion: Recommend not to enact bill in its present form since it may create inequity in the other retirement systems. Committee suggests that the Benefits Review Task Force review this issue. Discussion: This bill as written will exempt retired TPAF members who return to employment from re-enrolling in the pension system and it would also preclude teachers hired for the first time from enrolling in the TPAF if their annual compensation was less than $10,000. If the intent is to allow TPAF members to become reemployed in a TPAF covered position without suspending their pension than perhaps legislation should be patterned after P.L. 2001, C.278 which allowed retired PERS members to earn up to $15,000 annually in a PERS covered position without requiring them to reenroll in PERS. S-2446 (Adler)/A-3952
(Cohen) Motion: Recommend not to enact since it would create disparity in comparison to the way survivors benefits are paid in the other State retirement systems. Committee suggests that the Benefits Review Task Force review this issue. Discussion: The enactment of this bill impacts only the JRS and will encourage the introduction of future legislation expanding this benefit enhancement to the other State-administered retirement plans where surviving spouses' pensions are paid. JRS members may already leave a pension benefit payable over the lifetime of any designated beneficiary upon the death of the member after retirement. P.L. 2002, c. 54 provided JRS members with the same optional forms of pension payments that exist in the PERS and the TPAF. For the JRS retired members, this is in addition to the twenty-five percent of final compensation benefit payable to the surviving spouse. A-1676 (Munoz) Motion: Recommend not to enact due to the increase in State costs and the disparity it would create in accidental death benefits when compared to the other State retirement systems. Discussion: The enactment of this bill will require the State to pay the cost of surviving spouse health benefit coverage for both the State and local PERS members. The bill indicates its provisions are retroactive, requiring State payment for surviving spouse health benefit coverage for PERS accidental death benefit cases awarded prior to the bill's enactment. The State's annual expenditure for health benefit coverage is estimated to increase by over $1 million. in the first year. A-4101 (Diegnan) Motion: Recommend not to enact since it would significantly increase annual State SHBP costs. Discussion: If enacted this bill would mandate the participation of each local school in the SHBP and would increase the aggregate cost of providing health benefit coverage to school board employees. The cost to the State of providing this benefit is significant, estimated to be $1.2 billion in the first year. A-3537 (Johnson/Weinberg/Gordon/Voss) Motion: Recommend not to enact since this screening is already covered by the SHBP's NJ PLUS in-network and the participating HMO plans. The Traditional Indemnity plan will no longer be available for some members. Discussion: The procedure mandated by this bill is already covered under the SHBP managed care plans, i.e. NJ PLUS in-network and the participating HMO's. It is not covered under the Traditional Plan or NJ PLUS out-of-network. If enacted, an increase in the annual SHBP costs will result. S-2471 (Kenny/Lance) Motion: Recommend to enact since the State of NJ and its law enforcement bargaining units have agreed that participation in the SHBP's Traditional Plan will no longer be available to all active employees effective July 1, 2005 and to those that retire after July 1, 2005. Discussion: Language to this effect has been placed in the FY'06 State budget and an AG's opinion rendered April 12, 2005, advised that the laws governing the Traditional Plan would need to be amended in order for the agreement to be implemented permanently. The enactment of this bill is required to apply the binding collectively bargained agreement beyond the current fiscal year.
Motion: To recommend against enactment because it will encourage more legislation seeking to expand eligibility even further and will increase State costs. Discussion: The bill detracts from the original intent of the legislation that created the Prosecutors Part since the rationale in creating the Prosecutors Part was to encourage career employment for certain public employees whose duties were accompanied by the job hazards associated with criminal prosecution and similar to those of law enforcement officers. This bill would provide the higher benefit to individuals whose current positions are not associated with criminal prosecution. If enacted, the total additional unfunded liability would be $46 million with annual additional costs of $6 million a year. S-2712 (Asselta)/A-854(Barnes/Steele) Motion: To recommend against enactment since the vacant position created by the Early Retirement Incentives (ERI) are usually backfilled resulting in little if any cost savings to State and Local employers. Discussion: Savings produced by an early retirement program are very much dependent
upon the policy adopted regarding the refilling of vacated positions.
The maximum savings potential would result only if the positions
vacated are totally eliminated. Past ERI programs has shown that
backfilling of the vacated positions usually occur. Also, ERI programs
generate additional costs to the pension system as a result of members
retiring earlier than actuarially anticipated. At best, ERI programs
only produce short term savings. Motion: To recommend against enactment since benefits should be provided by the municipality for whom the firefighter volunteers. Discussion: The local government laws authorize fire districts to provide group life insurance and group accident insurance for members of volunteer fire companies. The appropriate parties to provide benefits to volunteer firemen disabled in the line of duty would seem to be the municipalities or fire districts for which they volunteer. A substantial disparity in benefits provided to volunteer firemen injured in the line of duty could be created. If the volunteer is a fireman of PFRS, the member would be eligible for PFRS pension and death benefits in addition to the benefits provided by the municipality or fire district in which he/she volunteers. If the volunteer is not a PFRS member, the volunteer would be eligible only for the benefits provided by the municipality or fire district. A-1899 (Oliver) Motion: To recommend against since it is a piecemeal attempt to redesign the death benefits payment as it applies only to terminated vested members and not to active members with more than 10 years of service. Discussion: Concerns were raised that the bill will create disparity in benefits paid to active members dying with 10 or more years of service compared to terminated vested members. Benefits would be payable only to a surviving spouse, which along with the retroactive provision indicates that it is special legislation. It would also result in State and local employer pension costs. State-mandate, State-pay issues may need to be addressed. A-1825 (Manzo) Motion: To recommend against enactment since it will increase pension costs to the State. Discussion: The enactment of this bill will encourage future legislation extending the same State subsidy to all other local entities. It will also create an additional pension contribution costs to the State of $5.5 million in 2006 increasing annually. A-2819 (Cohen) Motion: To recommend against enactment since there is no rationale for extending the dates of the Korean conflict beyond what is currently recognized in State law. Discussion: The current eligibility dates in State law applicable to the Korean conflict reflect for the most part the same dates as for federal recognition of veteran wartime service. For federal wartime veteran benefits, both the Department of Veteran Affairs and the Office of Personnel Management (OPM) recognize the period from June 27, 1950 through January 31, 1955 as qualifying dates for the Korean conflict. A-4337 (McHose) Motion: To recommend against enactment since it would create a different licensing requirement for school psychologists as opposed to other practicing psychologists. Discussion: If school psychologists were required to be licensed by the State, then allowing them to bill and be paid by an insurer would be consistent with requirements for coverage of other providers. However, since school psychologists are not required by the State to be licensed only certified by the State Department of Education the quality of their education, experience, and tracking/reporting problem professionals may not be commensurate with those providers that are licensed by the Psychology Licensing Act. S-2518 (Adler) Motion: To recommend enactment since it is a natural continuation of domestic partnership rights first provided by the State's Domestic Partnership Act P.L. 2003, c. 246. Discussion: Since the State has already adopted the Domestic Partnership Act it is reasonable to include the domestic partner as a "family member" under the New Jersey Family Leave Act. A-333 (Weinberg/Johnson/Previte) Motion: To recommend enactment since it will expand health benefit coverage to those that suffer from non-biologically based mental illness. Discussion: The enactment of this bill will ensure that those individual that suffer from non-biologically based mental illnesses including alcohol and drug addiction can be diagnosed and treated early. If left untreated these conditions will worsen, which in the long-run will increase healthcare costs. A-3974 (Van
Drew) Motion: To recommend against enactment since it will increase annual State costs. Discussion: If enacted this bill will provide State-paid post-retirement medical benefits only to State employees retiring on a veterans benefit. It will encourage future legislation that will provide State-paid post-retirement benefits to other groups. If enacted, this bill will increase annual State costs by approximately $11,100 per eligible retiree. A-887 (Diegnan/Barnes) Motion: To recommend against enactment since it will create a disparity in the accidental death benefits payable to other PERS members and to members of the TPAF. Discussion: Laws governing the PERS and TPAF currently do not provide for State-paid health benefits to the surviving spouse. Although, this bill would provide State-paid health benefits to surviving spouses of PERS members who meet the definition of a policeman and qualified for accidental death benefits, it would not provide it to regular members of PERS, or to members of the TPAF. This bill's enactment would most likely encourage the introduction of future legislation expanding the benefits to these groups.
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