New Jersey Assembly Bill A4171

New Jersey 2022-2023 Regular Session

• Introduced: 6/2/22
• Refer: 6/2/22

Caption

Requires cost of living increase to be granted in each of two State fiscal years when retirement allowance or benefit is below certain amount for retiree or beneficiary in PERS, TPAF, PFRS, SPRS, and JRS; makes appropriation.

Impact

The proposed adjustments would take place on January 1, 2023, and January 1, 2024. The bill stipulates that the increase will be calculated at 100 percent of the change in the Consumer Price Index (CPI), which is more generous than previous adjustments that were capped at 60 percent. This change aims to restore some stability to the benefits of lower-income retirees, who may be struggling with the rising cost of living. The cost for these adjustments will be funded by the State General Fund and represents a significant commitment towards supporting retired public employees.

Summary

Assembly Bill A4171 is designed to provide a cost of living increase for certain retired public employees and their beneficiaries who are receiving retirement benefits from various pension systems, including the Teachers' Pension and Annuity Fund, the Judicial Retirement System, the Public Employees' Retirement System, the Police and Firemen's Retirement System, and the State Police Retirement System. The increase will only apply to retirees and beneficiaries whose monthly payments are at or below 150 percent of the federal poverty level for a single-person household.

Contention

While the intent of A4171 is to alleviate financial pressures for retirees who have fixed incomes, the bill may face scrutiny regarding its fiscal implications. Critics may argue that the allocation of state funds for pension increases could strain the budget, particularly in years of economic uncertainty. Additionally, discussions may arise concerning the appropriateness of tying benefits directly to cost of living adjustments, especially for those not in immediate financial distress. This makes the bill not only a fiscal decision but also a moral one regarding the welfare of retired public employees.