There have been many media reports about various deals being negotiated as part of this year’s state budget process. There are several important issues being discussed now, including placing the state’s lottery into the public pension plans, taking portions of the Horizon Blue Cross/Blue Shield reserve funds to pay for an opioid addiction program and reform the way Horizon is governed, and changes to the school funding formula. Some elected leaders have threatened a state shut down if there is not a deal in place on all of these issues by July 1. Here is what CWA is working on at this time and here is our position on the important issues in this year’s budget negotiations:
Christie’s Pension and Lottery Deal:
Under this proposal, the lottery would be made an asset of the pension. Our legal and pension experts have reviewed the proposal and so have our actuaries. We have legal questions for which we do not yet have answers, but we believe the current proposal will do no harm to the pension plan or the services currently funded by the lottery. There is also a benefit to the plan of having a dedicated revenue source of approximately $1 billion a year if the plan survives any legal challenges. It is the goal of Governor Christie and Senate President Sweeney to have this deal completed as part of the state budget process, which requires a budget to be in place by July 1 or a government shutdown will occur. Even though we believe there is a small benefit to the pension, the fact that we have legal questions that cannot be answered in the time frame necessary to complete the legislation, CWA neither supports nor opposes this deal.
Under this proposal, a Governor would have the authority to appoint board members to Horizon Blue Cross/Blue Shield, and would have some authority to take portions of the reserves of Horizon BC/BS to fund other state initiatives. We believe that making large changes to health care delivery in light of the current uncertainty with health care in Washington, and doing it in a secretive process in which a bill goes from introduction to being law in as little as three days is unwise. We also believe that ratepayers of Horizon BC/BS should be the beneficiaries of Horizon reserves and that funding new state programs, however necessary they are, is inappropriate. Additionally, the reason New Jersey doesn’t have money to spend on opioid addiction programs is because we have seen eight years of record-breaking, budget-busting tax cuts for the wealthiest among us.
State Health Benefits:
The unions of the Plan Design Committee asked legislative leadership in both houses to reject Governor Christie’s call to find $125 million in savings to the SHBP this year. Governor Christie has broad power to certify what revenues will come in or how much things will cost, and legislative leadership was unwilling to cut $125 million in spending elsewhere in the budget in order to eliminate the need to save money in health care. We expect a budget resolution to amend Christie’s initial proposal that will call for $125 million in savings in health benefits this year to be part of this budget, and we expect Christie to call for shifting more costs to public workers as part of the Plan Design Committee negotiations this year.
CWA will oppose any further shifting of costs to members on healthcare.
We will need to 1) mobilize members to come to plan design committee bargaining sessions this year to ensure all unions refuse to deal with the Christie Administration, and 2) work hard to elect a Governor who will reverse the effects of this decision and identify other places in the budget to find these savings once a new Governor is in office next January.
Some elected leaders are threatening a state shutdown if there is not a deal on the budget, the lottery/pension plan, Horizon, and changes to the school funding formula by July 1. We believe Democrats should not be making bad deals with the least popular Governor in the country, especially when we are mere months away from a new Governor. We believe threats to shut down the state and disrupt vital services over issues that have nothing to do with the functions of state government are irresponsible.
We will also not allow any elected official to push us into taking a terrible position on school funding or Horizon or the lottery/pension plan by threatening our state worker members with a shut down.
Thank you for your continued service to the State and our communities. We will continue to keep you informed as these issues develop over the next few days.