Is the sky falling? Are we really in a financial emergency? Part V: Does the financial community think that we are bankrupt?
- On: 02/15/2008 10:13:26
The Governor’s supporters have said that
Independent rating agencies, such as Moody’s and Standard & Poor’s review the finances and economic outlook of companies and government units. They have analyzed the finances of
Standard & Poor’s has given
Is the sky falling? Are we really in a financial emergency? Part IV: Do we owe billions in healthcare benefits?
- On: 02/06/2008 15:55:26
New Jersey has promised health care benefits to its state employees after they retire. However, there is no equivalent of a "pension plan" for healthcare benefits in New Jersey. Healthcare benefits are paid on a current basis by the state. Last year the benefits cost $1.031 billion.
This year they were $1.128 billion.
Is the sky falling? Are we really in a financial emergency? Part III: Do we owe billions to the Pension Plan?
- On: 01/23/2008 15:36:45
New Jersey currently has about $90 billion set aside in our pension plan.
We could probably pay benefits for most of the next 30 years without making any new contributions. However, the goal of the pension plan is to have enough money in the fund to pay benefits in perpetuity. In other words, we always want to have a pot of money for the future.
The unfunded liability is the amount of money we need to save for the future. It is the estimated amount New Jersey would have to pay in pension benefits over the next 30-40 years in excess of amounts we already have set aside in the plan plus investment earnings on those amounts.
Is the Sky Falling? Are we really in a financial emergency? PART II: Is the Transportation Trust Fund Bankrupt?
- On: 01/22/2008 16:05:53
The Governor has stated that the New Jersey Transportation Trust Fund (“TTF”) will be out of money after 2011. This is correct. And there is a good reason for this. The legislature only authorizes money for the TTF for stated periods, the last one being for the years 2007-2011. The legislature has just not gotten around to deciding how much money will be provided for the period starting in 2012.
While it is correct that no money has yet been allocated to the TTF, it is not the case that the TTF is bankrupt or has used up all its money. In fact the TTF reports it has sufficient capacity to support the capital program for transportation projects at $1.6 billion annually through 2011.
Is the sky falling? Are we really in a financial emergency? PART I: Are our bridges collapsing?
- On: 01/17/2008 16:46:33
In October there were headlines that repair of
$13.6 billion sounds like an enormous amount of money but when you get past the headlines, you can relax a little. First, this is the cost spread over 10 years, so despite the fact that the money is supposed to go to repair bridges “structurally deficient” or “functionally obsolete” it is unlikely that all of our bridges are going to collapse tomorrow.