Legislative News ~ Alerts
Stay informed! Stand United! Speak Out!
NJEA’s new webpage allows members to take action on any issue all from one convenient location. Do all this and more at: NJEA.ORG/TAKEACTION
The Take Action webpage is accessible only to members by going directly to: njea.org/takeaction. Log in with your pin found on your membership card or the email address you have registered with NJEA. Your password is the last four digits of your Social Security number. For problems logging in visit: njea.org/resources/help-desk or call (609) 599-4561 and ask for Membership.
Stop Betsy DeVos’ Nomination To Be Secretary of Education
Unqualified and Inexperienced – Vote No on DeVos. NEA members and public ed advocates have sent more than 800,000 emails to senators, and it’s working! The vote for Betsy DeVos has been delayed, now we need to keep the pressure on for senators to vote NO.
Now the Senate Education Committee has delayed their vote. Senators are being inundated with your emails and calls, and they’re looking more closely at DeVos’ clear and demonstrated lack of knowledge of public education, and at her concerning ethics disclosures.
If you haven’t taken action yet, now is the time. If you’ve already contacted your senators, it’s time to contact them again. Here’s the plan:
Step 1: Email your senators. Keep up the drumbeat that DeVos is completely unqualified to be put in charge of our nation’s schools.
Step 2: Call your senators at 1-855-882-6229. Make sure they feel the pressure in Washington and in their district offices.
Step 3: Share this post on Facebook. Spread the word that you don’t want DeVos to be confirmed, and ask your friends to contact their senators, too.
Thanks for stepping up. Your voices are being heard, and you are making a huge difference!
Using Pension Funds to Invest in Transportation Trust Fund Debt
NJEA opposes S-2842 (Sweeney, Addiego). This bill would allow the Director of the Division of Investment to invest unlimited pension or annuity funds, which are otherwise allocated for investment in fixed-income securities, in certain debt obligations issued by the New Jersey Transportation Trust Fund (TTF) Authority.
More specifically, this legislation would supersede a State Investment Council regulation that limits the Pension Investment Council’s purchase of bonds or other interest-bearing obligations of a public authority to 10 percent of the outstanding debt of the public entity.
NJEA believes investment decisions should be left to the Director of the Division of Investment and the State Investment Council and made for the sole and exclusive benefit of the participants and beneficiaries of those pension systems that they oversee. The State Investment Council, whose members represent both the public and the pension funds, should be relied upon to invest pension funds without political interference.
As written, this legislation contradicts and ignores the “prudent person” standard. The “prudent person” standard requires that those investing funds for others exercise sound discretion with regard to the disposition of the funds, considering income as well as safety of the capital invested. The federal Employee Retirement Income Security Act of 1974 (ERISA) further emphasizes this obligation by noting that it is the duty of fund trustees to act solely in the interests of the plan beneficiaries. A new policy of investing pension funds in TTF bonds may violate this “prudent person” standard by opening up the possibility that such an investment strategy is done more for the benefit of lower borrowing rates for the TTF, rather than making an investment decision solely for the exclusive benefit of the pension fund beneficiaries.
This has also been the longstanding policy of the State of New Jersey under P.L. 1950, c. 270 (C:52:18A-89), which states “The director (of Investment) shall be under a duty to manage and invest the portfolio solely in the interest of the beneficiaries of the portfolio and for the exclusive purpose of providing financial benefits to the beneficiaries of the portfolio.”
The State Investment Council has many regulations that help govern the practices and procedures for investment to be followed by the Director of the Division of Investment. Among them are various rules imposing limitations on a variety of transactions, like investments in mortgages, international government and agency obligations, state authority obligations, and other debt obligations. These limitations are, in fact, designed to diversify our pension investments and mitigate our pension funds’ risk exposure.
We should continue to leave investment decisions up to the Director of the Division of Investment. If there are rules hampering the division’s ability to fulfill its fiduciary obligation, then those regulations should be changed by the State Investment Council. As such, NJEA believes that S-2842 is unnecessary and inappropriate.
NJEA urges you to OPPOSE S-2842, and leave all investment decisions to the Director of the Division of Investment.