(CNN) – Gov. Chris Christie will cut planned pension payments for state employees by almost $2.5 billion over the next two fiscal years, the New Jersey Republican announced Tuesday.
The move is part of the governor's plan to close an unexpected $807 million budget shortfall that his administration was made aware of last month.
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The administration and the Democratic-controlled state legislature must figure out a solution to balance the $33 billion budget by the end of the fiscal year on June 30.
This year the administration will pay $696 million in pension payments out of the scheduled $1.6 billion, and $681 million out of next year's planned $2.25 billion payment.
Christie said the payments will go toward covering the costs accrued by active employees, but it doesn't pay down debt built up under previous administrations.
"I'm going to pledge to make the payments that we need to make to not dig the hole any deeper, but in a time when we're confronted with this type of challenge I cannot also pay the sins of my predecessors," Christie said.
His state faces a massive pension debt of $52 billion. New Jersey's credit rating was downgraded for a sixth time last week by a credit rating agency since Christie became governor.
Christie, who's seriously thinking about running for president, had proudly boasted earlier this year that next year's $2.25 billion pension payment would be the largest ever made into the system. He talked about it in his State of the State address and at his numerous town halls, as he argued for more pension reform.
The economic challenges come as Christie chairs the Republican Governors Association, a group that's actively trying to frame a 2014 message that says states with Republican governors are more fiscally sound.
The governor reiterated he does not plan to raise taxes in next year's budget and will veto any bill the legislature puts forward that includes such revenue increases.
Democrats quickly pounced on the governor's announcement Tuesday. Assembly Majority Leader Lou Greenwald said the plan will "make our fiscal situation even bleaker."
"Gov. Christie is once again targeting the middle-class by delaying pension payments, while continuing to protect millionaires," he said in a statement.
"Abandoning pension payments only make things worse down the road," said Assembly Speaker Vincent Prieto. "And that's unfair to taxpayers who rightly deserve and expect better from someone who vowed to fix the state."
CNN's Steve Kastenbaum contributed to this report.
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If the state keeps doing state pensions......they will.......bankrupt the state. That is guaranteed.
@Malory-There is no way to know actual numbers of small vs big donors in regards to either party. That being said, if you really think the majority of the Dems funds come from little people you are dreaming. The Dems want you to think that but simple logic says the rich would easily out spend the middle and poor classes. Hence, the GOP would be way ahead as far as fund raising goes and they are not. The only explanation would be both parties are funded by fat cats and small donors but the fat cats are way smaller in number and more important. Ask yourself, have I attended one of Obama`s $35,000 a plate dinners? NO!
Those of you who think Christie should just raise taxes, obviously don't live in NJ. It's a disaster and always has been. Property taxes alone are unbelievable. Look at any realty website and see for yourself what the going tax rates are on a modest 1800 to 2200 square foot home. The Government needs to make do less of our money. Period.
@it must be said: The VA mess started long before President Obama was elected (for the first time). And there are memos showing that the White House was purposefully kept in the dark about it.
President Obama's administration has done more for vets than GW ever did. Obama got us out of Iraq and is getting us out of Afghanistan; he gave the kill order for bin Laden; his administration increased the VA's budget to recruit and retain more mental health professionals; expanded VA Centers in rural areas; established standards of care for traumatic brain injury treatment; fully funded the VA (after Bush cut it); expanded the VA's number of "centers of excellence" in specialty care; expanded housing vouchers program for homeless vets; launched supportive services-housing program for vets to prevent homelessness; the list goes on and on.
And now that the lying at the VA regarding appointments has come to light, he will address that.
So put a sock in it!
This is nothing new. Christie signed an annual tax cut into law his first year that cost nearly a billion dollars per year in tax revenue. He paid for it by not making pension payments. I've told you about this before, yesterday, too
Seems as if Chris Christie is his own biggest antagonist. He's been in conflict with himself ever since he made the national spotlight.
Do as I say ... not as I do. I doubt he will make it into the presidential primaries. No doubt Mitt Romney understood Chris Christie better than his own party understood Chris Christie.
Wow – tax cuts cost don't they? Where are all the 'makers' and their job creation? Don't tell me trickle down economics isn't working either!
'No, but why do you think NOTHING is his fault? He's been in office 5.5 years now and STILL the Obama clones in here make excuse after excuse for this incompetent idiot. Everything that happens gets the same response, we just learned about it on TV, we didn't know anything about it, we'll get to the bottom of it, we'll get who is responsible, George Bush did it."
Oh look, the boy who cried wolf is wondering where everyone went when there was a real complaint to be made....poor baby....
it must be said
The Obama administration was told they shouldn't trust the information coming out of the VA and yet did nothing about it.
You've made two assertions there. So just so I know, what is your source for them? Specifically, they were told this by whom, and when? Secondly, you claim that they did nothing about it. That's a pretty broad statement. Offices were fudging data to hide it from the VA administration, that's been shown. What is your source for the assertion that this specific thing should have been caught and no action was taken to catch it?
One only needs to look to Illinois to see what happens when the state fails to make the appropriate payments to the pension fund. It will snowball in no time, then you're in for some real fun.
Christie is trying to prove his plutocrat bona fides for the dark money donation train in 2016. He basically just did a faceplant in the Koch brothers' laps. How many licks DOES it take, Christie?
"There is no way to know actual numbers of small vs big donors in regards to either party."
Yes, there is. Stop making things up.
"if you really think the majority of the Dems funds come from little people you are dreaming."
I guess we're dreaming then, because it's consistently shown to be the case...over and over and over again...and, considering the fact that you're living in a fantasy if you think there's "no way to know" (see above), it's not really up for debate.
"The only explanation would be both parties are funded by fat cats and small donors but the fat cats are way smaller in number and more important."
Taken out of the context of your other statements, which were incorrect, that one sentence is true.