Marlboro Mayor Jonathan Hornik today noted that the State of New Jersey historically shirks its obligations to the “chronically underfunded” pension system while local governments have been meeting their obligations. Hornik’s comment came in a press release touting S&P Global Ratings reaffirming his township’s AAA bond rating.
S&P noted that while the Township continues to make its annually required pension contribution to the State of New Jersey, the State pension system is chronically underfunded. “Local government continues to pay its share, and historically the State has shirked its obligation,” stated the Mayor. “In the context of our review, S&P reiterated its concern regarding the long term health of the State system. I am hopeful that with a new Administration in Trenton, the State will take a more responsible approach to its stewardship of the pension system.”
“The current pension system is a sinking ship,” Hornik said in a phone interview. “Governor Murphy did not create the problem, but he needs to fix it. New Jersey needs to fulfill it’s obligations to retirees and long term employees, but we need to make dramatic changes for newer employees going forward.”
Hornik said that S&P expressed concern about Marlboro’s “contingent liability” for the State’s pension obligations while reviewing the township’s finances and that he is very proud that they nevertheless reaffirmed Marlboro’s AAA rating. “It’s not easy in this environment in New Jersey,” the mayor said.
The mayor said that he was not familiar with the pension reform proposal offered by state Senator Declan O’Scanlon or the recommendations of the final report of the New Jersey Pensions and Health Benefits Commission published last December, but that drastic action is required. “Anyone who doesn’t think this is a real problem hasn’t talked to a rating agency,” Hornik said.