New Jersey Gov. Jon S. Corzine has his eyes on the state’s toll roads as a new source of revenue to pay debt, reduce property taxes and fund unmet needs. The Governor’s idea was to turn over toll roads including the New Jersey Turnpike and the Garden State Parkway to private investors in a sale or lease. State lawmakers who don’t like the idea of losing control of the toll roads have come up with a creative alternative. The state pension fund with over $70 billion in assets would buy it as a pension plan investment, and receive the tolls as investment income.
State Senator Raymond J. Lesniak, who introduced a bill last month to authorize the state to negotiate a lease deal with private investors, endorsed the idea of letting the pension fund take over the toll roads. Sen. Lesniak said that it is:
consistent with the fiduciary responsibility of the pension fund to make investments that help New Jersey’s economy by reducing debt through a solid long-term investment, and contributing to the overall economic health of New Jersey.
If it happens, then it better pay off. New Jersey’s deficit for its largest public employee pension system grew to $7.2 billion last fiscal year, a $2.7 billion increase from the previous year.
Oh! Before you ask. Public employee pension plans are generally not subject to ERISA’s funding, vesting, disclosure and fiduciary rules