Published in the New York Times, Friday, September 1, 2006
Multiple Jobs by Public Workers Strain Pension Plan
By RICHARD G. JONES
TRENTON, Aug. 31 — New Jersey officials on Thursday released the salary records of the highest-paid public employees who have multiple public jobs. State lawmakers, who are struggling to curb soaring property taxes and cut state expenditures, say that the practice of holding multiple positions — and earning more pension credits as a result — has added a huge burden to the state’s troubled pension system.
In some cases, the multiple jobs entitled employees to annual pensions worth more than $130,000.
In one instance, a lawyer in southern New Jersey earned about $186,000 a year and pension credit from 11 towns where he works as a municipal court judge.
In another case, a lawyer from the Jersey Shore earned about $287,000 annually — he is the top earner among the roughly 5,000 state employees with multiple positions — while working as a judge in eight towns.
One lawyer from Secaucus, Herbert Klitzner, earned about $227,000 as the general counsel for both North Bergen Township and the Union City school district. Mr. Klitzner, who has been a public employee for 25 years, would qualify for an annual pension of about $103,000 if he retired now.
“I didn’t create this system,” Mr. Klitzner said in a telephone interview on Thursday. “It’s part of the deal when you take this position.”
The disclosures about employees earning multiple pension credits, reported by The Star-Ledger on Thursday, came as the State Legislature pushes forward in a special session to develop strategies for reducing property taxes.
The state is examining ways to streamline expenses, health care costs, pensions and other benefits that collectively cost the state more than $8.4 billion a year.
Although the cost of paying benefits does not directly affect local property tax rates, it does affect the state’s operating budget, which last spring had a $4 billion deficit heading into the fiscal year beginning July 1, which triggered the weeklong shutdown of New Jersey’s government in July and an increase in the state sales tax.
Gov. Jon S. Corzine and some lawmakers have called for sweeping changes to the pension system, including an end to the practice in which workers — often professionals like lawyers, judges and accountants — are allowed to earn pension credit for doing part-time work for several municipalities or public agencies at one time.
In New Jersey, public employees must meet requirements that include 10 years of service to become vested members of the pension system.
In many other states, those who provide professional services are often treated like independent contractors and do not qualify for pension benefits.
Many on the list of the top 50 earners released by the state treasurer’s office on Thursday earned pension credit while working as judges, lawyers and tax assessors. One is a licensed master plumber.
They averaged about 22 years of service, qualifying them for annual pensions ranging from about $40,000 to more than $135,000.
Through a spokesman, Mr. Corzine said that the publication of the list strengthened his belief that part-time professional workers should not be afforded the same pension benefits as rank-and-file state workers.
“Eliminating loopholes that grant professional service providers and political appointees the same benefits enjoyed by career public employees is a no-brainer,” said the spokesman, Brendan Gilfillan, who added that Mr. Corzine “believes this reform is an essential part of the property tax discussion.”
Besides the cost of the plan, lawmakers said that the information about individuals holding multiple public jobs opened a window on how New Jersey politics works.
“I think it is invaluable to the public that they get this information, not just because of the money — which is very important — but you’re going to see what political networking is all about now,” said Senator William L. Gormley, a Republican from Atlantic County.
Mr. Gormley, who last week asked state officials to assemble the list of top earners with multiple pension credits, cautioned against characterizing all part-time municipal work as a means of pension abuse.
“Not to say everybody’s tacking here, but I think you’re going to see certain political scenarios that are going to cause permanent change in the state of New Jersey,” he said.
One analyst, Ernest C. Reock Jr., a retired professor at Rutgers University and a specialist in property tax issues, said the list highlighted holes in the state’s benefits system.
“There are some weak spots where people can take advantage,” said Mr. Reock, the former director of the Center for Government Services at Rutgers.
Mr. Reock said that although the salaries that are being paid for professional services might seem excessive, they could well be in line with market prices.
“It’s hard to tell: $300,000 sounds like a lot, $100,000 is not that much,” Mr. Reock said. “When you put all the pieces together, it may be justified.”
According to Mr. Klitzner, the general counsel for North Bergen and the Union City schools, professional help is worth the cost. “You don’t get there” — the level of his pension — “unless you’ve been around a long time,” said Mr. Klitzner, who has worked with North Bergen for 25 years and has advised the school district for 21 years.
Mr. Klitzner, 62, said the pension credit was an important inducement for public service work. “It’s an incentive for everybody who goes into municipal work,” he said. “You can get more money as a lawyer in private practice but you make it up with the benefits.”
And, Mr. Klitzner said, he would oppose any effort to exclude part-time professional workers from membership in the state’s pension plan.
“A deal is a deal,” Mr. Klitzner said. “You can’t change it retroactively. You can’t change it for people who’ve been relying on it.”
As for his pension, Mr. Klitzner said his goal was simple. “I’m hoping to live to enjoy it,” he said, though he was quick to add, “I have absolutely no immediate plans to retire.”
Jo Craven McGinty and Margot Williams contributed reporting for this article. Research was contributed by Jack Begg, Happy Blitt, Alain Delaquérière, Barbara Oliver and Carolyn Wilder.
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