TRENTON — Gov. Christie vowed to usher in a new era of fiscal responsibility in 2010 after almost a decade of Democratic leadership in New Jersey.
Christie, a Republican, gained national attention after enacting laws in his first term that required public workers to contribute more to their pensions and health benefits, increased the retirement age, froze cost-of-living adjustments, and promised more money from the state to shore up retirement plans.
But when Christie delivers his final budget address Tuesday, it will be clear that the governor failed to execute the turnaround he sought. New Jersey's $71.2 billion pension system is the worst-funded in the nation, according to Bloomberg; the state has less than 10 days' worth of reserve funds, well below the 30-day median, according to the Pew Charitable Trusts; the state's credit rating has been downgraded repeatedly; and experts are projecting a $1.4 billion deficit by fiscal year 2024 as a result of a series of tax cuts Christie signed into law late last year.
"Recent events have added incremental out-year budget pressure, in our opinion, to what is already a sizable structural budget imbalance driven primarily by pension underfunding," David Hitchcock, a credit analyst with Standard & Poor's, said when the ratings agency downgraded New Jersey's general obligation debt in November.
Christie on Tuesday is expected to propose contributing about $2.5 billion to the pension system for the state's 770,000 active and retired public employees. Although that would be the biggest payment in New Jersey history, it represents half the amount actuaries recommend, according to Treasury Department data.
Christie over the summer signed into law a $34.5 billion spending plan for the current fiscal year.
The pension crisis predated Christie's tenure. The state had ignored its obligations for years. Growing pension liabilities leave less money for other state needs.
As part of the 2011 law that overhauled the retirement system, Christie committed to a budget that would set New Jersey's pension plans on the path to fiscal health over seven years.
Facing massive revenue shortfalls in 2014, though, the governor cut back on the scheduled contributions for two fiscal years, increasing the pension system's unfunded liability. Unions representing public employees sued Christie, but the New Jersey Supreme Court ruled in his favor.
Seeking a more sustainable fix to the retirement benefit system, Christie in 2015 endorsed recommendations made by a panel of experts to scale back health benefits for workers and use the savings to pay off the pension debt.
But Christie's public pronouncement of an "unprecedented accord" with the state's biggest teachers' union in his budget address that year provoked a backlash among union leaders. The union cut off the previously private negotiations, effectively killing Christie's proposal.
His backup plan is to spread payments over a longer period.
Now he's warning voters to be wary of gubernatorial candidates who say they can deliver where he could not.
"When you have a budget that has pension payment increases for the next six years of $650 million a year every year, I can guarantee you that no matter how much the state grows, there is no way to add to that," Christie told reporters on Feb. 16.
"And you've got candidates running around who are promising the sun, the moon and the stars to people. And they've got to understand one of two things: either they're lying or they're going to increase taxes so much that people are not going to be able to live here anymore."
Following his failed presidential run, Christie last year returned to New Jersey and shifted his attention to another taxpayer concern: school funding.
Pitching his plan as a property-tax relief measure, Christie proposed redistributing state aid to give each district the same funding per pupil — meaning more money for suburban districts and deep cuts to urban schools.
While Democratic legislative leaders have rejected his approach — and have been pursuing their own funding remedies — Christie has suggested that he might incorporate his plan in his budget proposal.
Education groups have voiced concern, but not all observers expect Christie will follow through. "It would just destroy public education in the urban centers of the state and probably invite legal challenges," said John Donahue, executive director of the New Jersey Association of School Business Officials.
School aid is contingent in part on how Christie proposes funding the pension system, Donahue said. If Christie were to fully fund pensions, "where's that money going to come from?" he said.