A Letter from Union County

Here is a letter I received from George Devanney, the Union County Manager, regarding the ‘Pension Deferral’ bill:

Dear Legislator:

I am writing to urge your support of Senate Bill 14 (A-3688). The importance of the passage of this “Pension Deferral” bill is crucial to the operation of Union County Government in particular and county governments in general.

Union County has put forward a responsible budget that reduces personnel costs in excess of $5 million a year, eliminates services, realized nearly $1 million in new negotiated employee givebacks, increases taxes and generates over $1.5 million in new revenues.

While a component of the budget involves the usage of $4 million in pension deferral monies, we did not arrive at this decision to use the funds lightly. In fact, in ordinary times, we would not require a pension deferral at all and have included a plan to pay this one back responsibly and quickly. We are expecting to generate recurring revenues equivalent to and greater than the amount deferred by 2010 and 2011 in order to reduce the tax impact. Although Union County is eligible to defer one half of its pension liability of $10 million, we are opting to only defer $4 million and have the remaining $6 million held in trust.

We also agree that it is time for government to “tighten our belts”. Therefore we have taken steps to reduce our workforce and economize services. We are still mindful, however, that it must be done responsibly and not in a way that further jeopardizes the economy as a whole.

We are painfully aware that this historic recessionary period has placed extraordinary pressure on property taxpayers. So this pension deferral plan should be looked up as New Jersey’s “stimulus package” to assist local and county governments by staving off further layoffs and reductions in governmental services.

With deteriorating economic conditions affecting all governmental budgets, this is one of very few options which could provide short-term relief just when it is most desperately needed by local budget makers and property taxpayers.

The County of Union is simply requesting the usage of this pension deferral in a limited manner and requests your urgent attention and support to do so.

Sincerely,

George W. Devanney
Union County Manager