How We Will Win the Constitutional Amendment Stewards Training February 22, 2016

Agenda I. What the Amendment Does II. How To Pay for it with NO Tax Increases III. What We’ve Done to Put Ourselves in the Best Possible Situation IV. What we Know About the 2016 Election V. What Our Campaign Looks Like

What the Amendment Does Last Session: ACR3/SCR184 – Passed January 11, the last day of the legislative year. – All Democrats in favor, all Republicans against. Exception: Dancer (R-12) abstained, several were absent This session: ACR109/SCR2

What the Amendment Does Amend Article VII by adding a new Section IV to read as follows: “The State shall make its annual required contribution to each retirement system and pension fund for public employees administered by the State … The annual normal contribution plus the annual unfunded accrued liability contribution together shall be the annual required contribution.”

First Full Payment: FY2021 “The State shall commence making its annual required contribution in full to each retirement system and pension fund for public employees administered by the State in the State fiscal year that commences July 1, 2021 and shall make the required contribution in full in each fiscal year thereafter.”

We’re Getting Good at Fractions “Commencing July 1, 2017, the State shall make a payment to each retirement system and pension fund of at least 4/8ths of the full annual required contribution for each system and fund for that State fiscal year and a payment that increases by at least an additional 1/8th of the full annual required contribution for each system and fund for each subsequent fiscal year until payment of the full contribution is required to be made commencing July 1, 2021.”

Quarterly Payments “The required contribution to be made by the State shall be paid in each State fiscal year to each system and fund on the following schedule: at least 25 percent by August 1; at least 50 percent by November 1; at least 75 percent by February 1; and at least 100 percent by May 1.”

Non-forfeitable Right Vested members of a retirement system … who were members of a system or fund prior to May 21, 2010 and who attained five years of service credit in the system or fund and were provided pursuant to law with a non-forfeitable right to receive benefits shall have an indefeasible non- forfeitable right to receive benefits as provided under the laws governing the system or fund upon the attainment of five years of service credit in the retirement system or fund.

State Appropriations Amend Article VIII, Section II, paragraph 2: “No general appropriation law for a fiscal year shall be enacted without including appropriations for the State contributions to each retirement system and pension fund for public employees administered by the State required pursuant to other provisions of this Constitution.”

Emergency Clause Article VIII, Section II, paragraph 3: “This paragraph shall not be construed to refer to any money that has been or may be deposited with this State by the government of the United States. Nor shall anything in this paragraph contained apply to the creation of any debts or liabilities for purposes of war, or to repel invasion, or to suppress insurrection or to meet an emergency caused by disaster or act of God.”

Real Emergencies Only Addition to that Clause: “Nor shall anything in this paragraph apply to the indefeasible obligation of the State to make contributions to each retirement system and pension fund for public employees administered by the State as required pursuant to other provisions of this Constitution.”

Christie comes out swinging

Now let’s hear the real story In FY2015 Budget, Christie cut the required payment from $3.1 billion in Chapter 78 to $1.3 billion. To do so, he unilaterally re-wrote language in Chapter 78, saying that the $1.3 billion contribution represented a three-tenths payment. Democrats wanted a faster ramp up. So in Christie’s last budget year, which would have been 5/10ths, they replaced it with 4/8ths.

Christie FY15 Plan vs. Constitutional Amendment (Est.)

About that massive tax hike… New revenue sources vs. new revenue needed for pensions Yearly averages, FY2017—FY2021

NJ Strengths and Weaknesses on Ballot Questions We get to: – Write the question voters will see on the ballot – Write the interpretive statement voters will see on the ballot with it We have no say over: – Where it appears on the ballot (law) – Where it is in relation to other questions that may be on the ballot (Secretary of State)

Key Takeaways from Research Focus on holding politicians accountable Focus on no new benefits Focus on values (fairness, paying our bills) Focus on no new tax burden

November 2016 Electorate 3.7 million voters 30% will not vote for amendments – Drop off is traditionally higher in strongly Democratic areas – That means about 2.6 million votes on the Amendment 1.3 million votes to win

Campaign Research: Voter modeling, opposition research Union member education campaign – 350,000 public sector members – 800,000 total pension beneficiaries – 400,000 union members not in state pension plans – Plus household members Non-union member campaign Paid media

Keys to campaign Drive union membership to vote for Amendment Drive family dependent on pensions and benefits to vote for Amendment Identify voters who will support but are likely to drop-off and drive them to vote for Amendment Identify third-party validators Out organize & Outspend business interests

Three scenarios Scenario 1Scenario 2Scenario 3 Public sector union members and pensioners turnout Equal to general population 10 points higher than gen public 20 points higher than gen public Pensioner house hold support One in three supporters brings 1 family member Half of supporters bring 1 family member Three in four supporters bring 1 family member Public sector union members and pensioners vote share 60%, same drop off as gen public 66%, one-third less drop off than gen pub 75%, half the drop off as gen public Drop-off supporters identified and vote down ballot 50,000100,000250,000

Three scenarios

Business Interests Gearing Up Business groups announced on Friday they are establishing a group, Opportunity NJ. It is able to solicit unlimited, secret donations.

Union member campaign Door knocks, phone calls and mail to union members in April, May and June – Unprecedented in NJ GOTV in September and October focusing on voting down ballot