April 2016                                                                                        Editor - Barry Chalofsky
In This Issue
PSMA Update
Annual Scholarships
Private Pension Fund to Cut Benefits
Court Ruling Could Burden System
Board Meeting Notes
Retired Managers' Network
IBEW Organizes Y, V & W

 Member Discounts

We are committed to providing members with greater benefits and discounts.  Just look for the icon above on the PSMA website: 

 

TheComfortOutlet.com

Regal Cinema

United Artists

AMC Theaters

Edwards Theatres

 

Reminder:  We have discount tickets for Regal, United Artists, AMC and Edwards Theaters!!

CONTRIBUTE TO THE PSMA PAC  

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In order for an organization to be effective it has to have a well-funded Political Action Committee (PAC).  PSMA is prohibited by law from using dues to give donations to candidates and political parties.  All monies used for that purpose come from a separate PSMA PAC which gets its funding directly from voluntary contributions by members.  In the past the PSMA PAC made some very critical donations to legislators who ended up supporting us in our quest for union legislation. Therefore, we ask that you send a donation via check to the PSMA PAC at:

PSMA PAC
212 West State Street
Trenton, NJ 08608

You can also pay via credit card - just write to [email protected] and request that a PayPal Invoice be sent to you. 

If you have any questions please contact Executive Director Lisa Ginther at [email protected]
We Need Your Contact Info

In order to serve you better PSMA  is asking that you update your contact information with your personal e-mail address.  PSMA members can go to our website at www.psmanj.org and fill out the interactive form. 
PSMA Board of Directors & Staff 

Stan Cach, President (DEP)
Biff Lowry, 1st Vice President (DEP)
Tonya Coston, 2nd Vice President (DOE)
Fred Gmitter, Secretary (LPS)
Philip Freeman, Sr.(AG)
Alfred Laubsch, Jr.(DOL)
Paula Howard (DOH)
Jerry Calamia (DOL), Financial Officer 
Barry Chalofsky (Ret.), Webmaster/Newsletter Editor 

Phil Frigero (Ret.) 

Michael Simone (Ret.)

Lisa Ginther, Executive Director
PSMA Website
 
 
Questions about PSMA:
[email protected]

IBEW Website

 www.ibewlocal30.org

Questions about IBEW Local30: 
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PSMA Update  
 
As you know, PSMA has been the voice for managers for well over 20 years. We delivered managers a union! This was not without the support of our members.
 
We need your help by stepping up to continue this fight - this includes joining our Board of Directors and getting more members! 
 
Please email Lisa Ginther, PSMA Executive Director at [email protected] if you have any questions, or if you're interested in joining our Board.  

We ask that you speak to other managers, especially managers that supervise other managers, to get them to join PSMA - please have them visit the  PSMA Website! 
 
Thank you for your support and loyalty to the only professional organization for NJ State Managers - formed by State Managers.

PSMA Announces 2016 Annual Scholarships $1,500 
June 30, 2016 Deadline
 
The Board of Directors has unanimously voted to continue the PSMA College Scholarship program. This year's program will provide three $500 scholarships to children of dues paying active employee PSMA members, based on merit.  
 
For scholarship applications and requirements "Click Here."  
 
The deadline for filing the application is June 30, 2016.  
 
Questions related to the program may be addressed to  [email protected] 
One of the Nation's Largest Pension Funds Could Soon Cut Benefits for Retirees

By Jonnelle Marte/Huffington Post/April 20, 2016
 
Members of the International Brotherhood of Teamsters and their supporters attend a rally outside the Capitol in Washington on April 14. The demonstrators protested a plan by the Central States Pension Fund to reduce payments to retirees. (Drew Angerer/Bloomberg)
 
More than a quarter of a million truckers, retirees and their families could soon see their pension benefits severely cut - even though their pension fund is still years away from running out of money.
 
Within the next few weeks, the Treasury Department is expected to announce a crucial decision on whether it will approve reductions to one of the country's largest multi-employer pension plans.
 
The potential cuts are possible under legislation passed by Congress in 2014 that for the first time allowed financially distressed multi-employer plans to reduce benefits for retirees if it would improve the solvency of the fund. The law weakened federal protections that for more than 40 years shielded one of the last remaining pillars that workers could rely on for financial security in retirement.
 
For many workers, the promise of a guaranteed income stream for life - a benefit now nearly extinct for younger generations - was at times strong enough to convince them to sacrifice pay raises or other job opportunities. But after decades of challenges that left many pension funds in tough financial straits, some people are learning in retirement that the promises made to them may have to be broken.
 
The Central States Pension Fund, which handles the retirement benefits for current and former Teamster union truck drivers across various states including Texas, Michigan, Wisconsin, Missouri, New York and Minnesota, was the first plan to apply for reductions under the new law.
 
Consumer advocates watching the case say the move could encourage dozens of other pension plans across the country that are facing financial struggles to make similar cuts.
 
With some of the country's largest coal companies in bankruptcy, about 120,000 retired miners and their families in West Virginia could lose their pension and health care accounts. For many families in this region, this means losing their only regular source of income. (Jorge Ribas/The Washington Post)
 
"This is going to be a national crisis for hundreds of thousands, and eventually millions, of retirees and their families," said Karen Friedman, executive vice president of the Pension Rights Center.
 
Like many other pension plans, the Central States Pension Fund suffered heavy investment losses during the financial crisis that cut into the pool of money available to pay out benefits. While the stock market has recovered since then, the improvements were not enough to make up for the shortfall that grew as the number of companies contributing to the plan declined and the number of people retiring and collecting benefits increased, said Thomas Nyhan, executive director of the Central States Pension Fund.
 
That imbalance left the fund paying out $3.46 in pension benefits for every $1 it received from employers. The shortfall has resulted in the fund paying out $2 billion more in benefits than it receives in employer contributions each year.
 
If nothing is done, the fund could become insolvent by 2025, said Nyhan. And because of its size, the plan could overwhelm the Pension Benefit Guaranty Corporation, the insurance agency meant to shore up private pension funds, if it went under, Nyhan said.
 
The Central States Pension Fund pays out $2.8 billion a year in benefits, which would be reduced if the plan became insolvent. By comparison, the PBGC fund that backs multi-employer plans has roughly $2 billion in assets and is also projected to be insolvent by 2025.
 
"This was a very hard decision, a gut-wrenching decision," Nyhan said, adding that he feared not taking any action could leave retirees with no pension at all. "It's not a question of if there are going to be cuts. The question is where and when."
 
If Treasury approves the fund's proposal, then retirees could see their paychecks shrink by July 1. The move would give the fund at least a 50 percent chance of lasting for another 30 years as opposed to running out of cash in 10 years if no changes are made, Nyhan said. A decision is expected by May 7.
 
But opponents say there may be some negative consequences if the cuts are approved.
 
"It's going to open the floodgates for other cuts," said Friedman of the Pension Rights Center.
 
Out of the 10 million workers and retirees covered by multi-employer pension plans, roughly 1 million people are in plans that could run out of money over the next two decades, according to estimates from the PBGC. Already, three other pension plans that pay benefits to truck drivers and ironworkers have applied to the Treasury to have their pension benefits reduced.
 
The proposal introduced in September by Central States would cut benefits for current workers and retirees by 23 percent on average, though exact amounts would vary based on people's age, health status and where they worked.
 
For many retirees, the losses may be much steeper.
 
Ava Miller, 64, and her husband, Ed Northrup, 68, could see their combined monthly pension income cut to about $3,000 from the nearly $7,000 they receive now, according to a letter they received from Central States in October.
 
If the cuts go through, Miller, who worked as a dispatcher in Flint, Mich., said they will need to dip into their savings to help cover their $1,300 mortgage payment, heating bills and trips to visit her 84-year old mother. Northrup, a retired car hauler, has started applying for truck driving jobs that could supplement their potentially smaller pension payments.
 
What makes the cuts more painful, Miller said, is that she took pay cuts so that the company could continue making contributions to the pension.
 
"I did everything I was supposed to," Miller said, adding that she and her husband made extra payments on their car loan to cut down on their monthly bills after they received letters in October informing them of the potential cuts.
 
Critics of the cuts say the fund still has time to come up with an alternative solution. Some retirees and other supporters have rallied behind a bill introduced by Democratic presidential candidate Bernie Sanders (Vt.) that would repeal the measure allowing the cuts, calling instead for the government to provide assistance to troubled pension funds.
 
Nyhan says he also supports that proposal and would welcome the money, but feels the chances that it will pass politically are slim.
 
If the cuts are approved, the proposal would be put to a vote by all 407,000 participants of the plan, including current workers and retirees who are exempt from the cuts because of their age or a disability. But even if a majority of the members vote against the proposal, the pension fund is so large that the Treasury Department may still be required to implement the cuts in order to protect the pension guaranty program.
 
Last week, hundreds of retirees, workers and family members from Michigan, Wisconsin, Texas and other states gathered on the lawn in front of the Capitol to rally against the cuts. They waved signs and periodically broke into chants of "No cuts."
 
A steady stream of lawmakers, including Sens. Elizabeth Warren (D- Mass.), Chuck Grassley (R-Iowa) and Tammy Baldwin (D-Wis.), walked on to a stage to speak against the legislation and to push for an alternative solution.
 
Roy Wroblewski, 64, a retired truck driver from Detroit, stood near the stage pumping his fist and holding up a sign that said "no cuts."
 
Wroblewski, who hauled cars for about 30 years before retiring at 58, said he had just begun to feel stable financially two years before when he began collecting Social Security benefits. If his pension payments are cut in half to about $1,300, he says he'll have to go back to work. But after two knee surgeries, truck driving is no longer an option.
 
Like other retirees at the rally, he said his union often prioritized preserving the pension over other benefits like pay raises. "We always said the money was good enough but we want to have [our pensions]," Wroblewski said. "Now we're back to fighting again."

Editor's Note:  Although this law does not affect public pensions the precedent that it sets could be disastrous if the federal government decides that public pensions should be treated in the same manner in the future.  That is why we must fight this type of legislation.
State Supreme Court Ruling on Public Employee Pensions Could Burden System

John Reitmeyer/NJ Spotlight/April 21, 2016

If top court decides to restore cost-of-living adjustments for retirees it could mean another $13B to state's unfunded pension liability
 
A decision from the New Jersey Supreme Court could come down at any time on a major case involving the health of the state's public-employee pension system. The impact of the high court's ruling will be felt at first only by retired workers, but voters statewide also have a reason to pay close attention to the outcome.
 
At issue before the Supreme Court right now is whether Gov. Chris Christie and lawmakers had the legal standing in 2011 to suspend annual cost-of-living adjustments that retirees enrolled in the pension system had been receiving along with their regular benefit checks.
 
A loss in court by the state could heap billions more onto an unfunded pension liability that already totals at least $44 billion -- adding as much as $13 billion, according to one estimate. And with a ballot question likely going before voters this fall that seeks to guarantee more substantial and regular state contributions to the pension system, the court ruling will also help determine exactly how big those future payments would have to be.
 
In fact, some in Trenton have begun to wonder whether it makes sense for the sponsors of the proposed amendment, including state Senate President Stephen Sweeney (D-Gloucester), to sit back and wait for the court decision to come out before putting the ballot question up for the final legislative approval that's needed to get the issue before voters this fall. It's already passed the Legislature once this year, in early January.
 
Others want to see the proposed amendment shelved altogether, saying givebacks from employees are needed instead of more funding.
 
But a spokesman for Sweeney said yesterday that the Senate leader has no plans to delay a vote.
 
"The senate president always intended to put the amendment up for its second approval later in the fiscal year," spokesman Richard McGrath said. "Nothing has changed."
 
The annual adjustments tied to inflation were put on hold as part of a broader, bipartisan reform law known as Chapter 78. Other changes required by that law included forcing employees to contribute more toward their pensions, hiking the retirement age for state workers, and calling for the state to put more money into the pension system.
 
Christie, a second-term Republican, and Democratic legislative leaders estimated at the time that the changes would save a total of $120 billion over three decades. They also said it would help save a pension system that had become one of the worst-funded in the nation thanks to years of skipped state payments.
 
But Christie later reneged on his promise to bring the state up to full funding of the pension system within seven years, and a group of retired workers has also challenged whether the state had the authority to suspend cost-of-living adjustments since pensions in general are considered a "non-forfeitable right." Their challenge made it all the way to the state Supreme Court last year. Oral arguments were heard by the justices last month. A decision is now expected at any time.
 
If the high court takes the side of the retired workers, it could add as much as $13 billion to the pension system's unfunded liability, according to a report issued earlier this year by Moody's Investors Service, a top Wall Street credit-rating agency. The unfunded liability, according to the state's latest official accounting, already totals $44 billion.
 
That figure is important because it is used by actuaries to help determine how much the state should be putting into the pension system on an annual basis to bring it back to good health. For example, the $1.3 billion pension payment that's scheduled to be made by the Christie administration in late June under a funding plan he put forward last year equals just 30 percent of the amount actuaries say the state should be contributing this fiscal year.
 
Under the proposed constitutional amendment sponsored by Sweeney, the state would accelerate its ramp up to the full contribution calculated by actuaries, reaching full payment by the 2022 fiscal year. Sweeney has argued the constitutional guarantee is the best way to ensure the pension problem gets fixed, given the record of underfunding that's occurred under Christie and prior governors from both parties.
 
And although contributions would eventually increase to over $5 billion if voters approve the amendment, Sweeney says the state will be able to afford those larger payments using normal growth in state tax collections and increased revenue that would come in if voters also approve a ballot question seeking to expand gambling into north Jersey.
 
But losing the case before the Supreme Court could make the state contributions grow even larger.
 
Sweeney, during a budget briefing held with reporters in February, said he was confident the state would win the case. And he also said nothing in the constitutional amendment will prevent the state from getting new concessions from workers in the future if necessary to keep the pension system on solid footing.
 
"The fiscally responsible thing to do is to get back on the payment plan," Sweeney said.
 
McGrath, his spokesman, said yesterday that the Senate leader's confidence hasn't been shaken by the unfolding court case.
 
"He continues to believe that the court will support the pension-reform law suspending the COLAs in order to restore the financial solvency of the pension system," McGrath said.
 
But the ballot question also has vocal opponents, including Christie and acting state Treasurer Ford Scudder. They've warned that the increased payments that would be required if the ballot question passes could bring on massive cuts or tax increases. Christie is also seeking a new round of employee givebacks, including freezing the current pension system and creating a retirement plan with some features of a 401(k).
 
Scudder cautioned lawmakers during recent testimony before legislative committees reviewing Christie's latest budget proposal about another component of the proposed ballot question, a requirement that New Jersey make its pension contributions on a quarterly basis. That could force the state to take on as much $100 million in interest costs because the administration would have to borrow money early in each fiscal year to cover payments until enough tax revenue comes in later in the year to fully fund them, he said.
 
"We all want to see a fully funded pension and a comfortable retirement for our past employees, but the current proposal would spell fiscal calamity for the state," Scudder said.
 
But Sweeney's staff believes Scudder is overestimating interest costs and also downplaying the investment gains the state would enjoy by accelerating when the state dollars are put into the pension system each year.
 
Senate Minority Leader Tom Kean Jr. (R-Union) also aggressively opposes the proposed amendment, saying it threatens to put pension funding ahead of other priorities, such as aid for local schools and hospitals.
 
The pending decision before the Supreme Court just adds another layer of concern, he said yesterday.
 
"I think this reinforces the dramatic uncertainty, whether it be from revenues coming into the state, whether it be from a court decision that could impact this obligation," Kean said.

PSMA Board Meeting Notes  PSMAlogo2
   
The Board of Directors met on April 5, 2016.  Items discussed included the Stronger United Independent Labor Council, membership, recruitment, PSMA restructuring of contractual agreements, financial status, scholarship program approval, and retirees' network.  The next meeting of the Board is on June 7, 2016.
Retirement
PSMA Retirees' Network Update 

The next PSMA Retiree Network Quarterly Breakfast is scheduled for:
 
Wednesday, May 4, 2016 at 10:00 AM at  
Wegmans in Nassau Shopping Center, Rt. 1, West Windsor, NJ

We have received payment from almost all of our members - however there are a few members who have not paid.  We have sent out one last notice.  Please pay vial Pay Pal or Credit Card online, or send a check to PSMA.  The dues for 2016 are still only $13.00.  If you joined in the last quarter of 2015 you do not need to pay for 2016.  We also ask that you give a donation to the PSMA PAC.
 
To those who have already paid - THANKS!  To those that haven't, please pay ASAP!

The Retiree Network is the only organization that can bring you the support of PSMA and the IBEW - so help us grow our membership!

Please take a moment and send an email to a state retiree to ask them to join. If you know of a retired state employee please have him or her go to http://www.psmanj.org/extras/RetiredManagers.pdf for more information.
IBEW
IBEW Seeks to Organize Y, V and W Managers      
Managers in Y, V, and W titles interested in learning how to organize with IBEW, please contact Joe Mastrogiovanni, Jr., IBEW Lead Organizer, at [email protected] or Click Here.