By Michael Aron
Chief Political Correspondent
The state spoke first.
Assistant Attorney General Jean Reilly arguing that the pension reform law of 2011 — known as Chapter 78 — is superseded by three clauses in the state Constitution.
“Plaintiffs’ contention that Chapter 78 creates a legally binding right to an annual appropriation of a prescribed amount construes the statute in a way that runs afoul of the appropriations, veto and debt limitations clauses,” Reilly said.
Justice Barry Albin seemed to find that ironic.
“The very proponents of this legislation now come before the Court just a few years after its passage and ask for it to be declared unconstitutional,” he said.
“It’s unconstitutional to the extent it creates a legally binding right to an annual appropriation of a prescribed amount,” Reilly said.
At issue is whether the state violated its own law by putting less money into the state pension system this year than the reform law required.
Trial Judge Mary Jacobson ruled it had and ordered the governor and the Legislature to work together toward a solution.
Today’s hearing before the state Supreme Court was the Christie administration’s appeal of that order.
On the other side sat lawyers for the major public employee unions, as well as Senate President Steve Sweeney who has taken the side of the unions.
The unions say the contract clause in the state and federal constitutions should take precedence.
The state says the appropriations process takes precedence.
“I think the word contractual — because it cannot be legally binding before the appropriations process is over — was aspirational,” Reilly said.
“The language is not ‘aspirational.’ The language is saying this is a contract. If we don’t put the money in, it’s an impairment of the contract,” Albin said.
“We have a contract that is subject to appropriation,” Reilly said.
“Even though the language ‘subject to appropriation’ is nowhere in the statute and it appears regularly elsewhere. You’re inserting those words,” said Justice Stuart Rabner.
“Yes, your honor, because that’s the undeviating principle on which the state has operated,” Reilly said.
The state argued that the Legislature of 2011 cannot bind future legislatures to certain levels of spending.
The unions strongly disagreed.
“There is no dispute that the Legislature can enter into contracts, can create contractual commitments that bind future legislatures,” said Steven Weissman, attorney representing Unions.
“I think there was an acknowledgement that a contractual right has been established,” said Michael Bukosky, attorney representing State Troopers Fraternal Association.
Several justices grappled with separation of powers issues.
“How can courts make that determination without wading into the middle of the budget process and the political and policy concerns that that presents?” Rabner asked.
“Is that an appropriate role for a court?” asked Justice Anne Patterson.
“It is an appropriate role for a court,” replied Weissman.
As a practical matter, if the Court were to side with the unions, it’s unlikely the justices would order an additional $1.6 billion pension contribution in the current year, which expires in eight weeks. But guidance for next year’s budget and for the years beyond that is likely to be what the Court delivers when it makes its ruling.