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N.J. Gov. Christie Seeks to Move State Employees to Blended Plan

In a recent speech in Washington, New Jersey Gov. Chris Christie (R) laid the groundwork for moving more state workers into a blended 401(k)/DB plan to fill a $807 million hole in the state’s $33 billion budget. Currently, the state’s retirement plan is underfunded by an estimated $51 billion, the Wall Street Journal reports.

Previous concessions from state workers gained Gov. Christie national attention in 2010. In that deal, workers were required to pay a greater share of benefits and the retirement age was moved from 62 to 65, while the state agreed to provide greater funding.

Many other states and municipalities are trying to address budget and retirement funding issues. Some, like Illinois, are trying to cut back benefits; others, like Detroit and Stockton, Calif., are using bankruptcy proceedings. (See a recap here.) Regardless of the means, however, the issues are starting to come home to roost. Essentially, states and cities over-committed to employees, overestimated returns and underfunded their plans.

Meanwhile, many states are turning their attention to private workers who do not have access to retirement plans at work. That trend is covered in a video by NAPA Executive Director/CEO Brian Graff here

Fred Barstein is the Portal Conductor of the NAPA Service Providers Station.  He is also NAPA Net’s Editor in Chief.