N.J. Assembly agrees to Christie's changes on private-sector retirement plan

By Samantha Marcus | NJ Advance Media for NJ.com
on January 12, 2016 at 6:10 AM, updated January 12, 2016 at 2:36 PM

TRENTON — The state Assembly voted after 1 a.m. Tuesday to cooperate with Gov. Chris Christie's veto of a bill creating a state-run retirement plan for private-sector workers, 12 hours after the governor handed down his executive veto.

Christie gutted the plan, sponsored by the Democratic leaders in both houses, offering instead to create a small business retirement marketplace to close the gap in private-sector retirement savings.

About 1.7 million people in New Jersey's workforce don't have access to an employer-sponsored plan, according to the AARP. And a U.S. Federal Reserve report has indicated that 31 percent of working Americans polled have no retirement savings. 

Assembly Speaker Vincent Prieto (D-Hudson) signaled earlier in the day he would accept the governor's conditional veto.

Christie vetoes state-run private-sector retirement plan

"It's not what I intended, but it's a step forward. I plan to revisit the issue next session," he said earlier in the day.

The Assembly voted 65-0 to concur with the veto. The state Senate, which will continue the voting session later Tuesday morning, still has to concur.

Modeled after Washington state, the marketplace would connect small businesses and their employees to existing investment vehicles, Christie said. A bill (S3261) creating "New Jersey Small Business Retirement Marketplace Act" was introduced by Sen. Steven Oroho (R-Sussex) in December.

"By following this model, the New Jersey Small Business Retirement Marketplace will provide a market-based approach so that small businesses can offer a simple and inexpensive way to offer private savings to their employees, which will result in workers saving more for retirement throughout their lives," he said in the veto message.

The bill (A4275) originally created the Secure Choice Savings Program. Businesses with at least 25 employees would be required to set up a payroll deduction for their employees, who could opt out of making voluntary contributions. The businesses wouldn't have to contribute. Businesses with fewer employees could choose to offer the plan to their workers.

While administered by a seven-member board of state officials, the money would not have been guaranteed by the state, and it didn't require any contribution from the state. The state would initially have to incur the costs of setting up the program.

In his veto message, Christie said the mandatory program would burden small businesses and duplicate services that exist elsewhere. 

Samantha Marcus may be reached at smarcus@njadvancemedia.com. Follow her on Twitter @samanthamarcus. Find NJ.com Politics on Facebook.