New Jersey’s unfunded pension liability will probably worsen because the state does not plan to fully fund its actuarial annual required contributions to pensions until fiscal 2018, Fitch Ratings said Tuesday.

“We believe that meeting the large increases in pension contributions needed to achieve full funding of the annual required contribution in 2018 will be challenging and is likely to conflict with other long-term goals, including property-tax relief, school funding and infrastructure needs,” Fitch said.

Failure to meet the state’s 8.25% return on investments would only increase funding demands, according to the rating agency.

Last week, New Jersey’s Division of Pensions and Benefits reported that the state’s pension deficit had increased by $5.5 billion to $41.8 billion over the past year.

The budget for the current fiscal year funds merely 14% of the actuarial requirement — roughly $2.9 billion less than the actuarially required amount — even after considering legislation in 2011 that changed benefits.

“The Fitch report shows again why pension reform was so vital. Unfunded liabilities for the fiscal year 2011 would have been $20 billion higher if pension reform had not passed,” said Andy Pratt, a spokesman for state Treasurer Andrew Sidamon-Eristoff.

In June, New Jersey passed two laws intended to curb pension liabilities, though they face court challenges.

The legislation increased employee contributions, raised the retirement age for new employees, and increased the age and required service thresholds for early retirement.

In addition, cost-of-living increases were eliminated for all retirees, though pension boards can reinstate them once pension systems achieve certain funding levels.

At its signing, Gov. Chris Christie called the bill “an important moment for the state of New Jersey, for its citizens, [and] its taxpayers,” adding, “New Jersey has once again become a model for America.”

All three major rating agencies downgraded the state’s general obligation bonds last year.

Fitch and Standard & Poor’s rate New Jersey’s GOs AA-minus. Moody’s Investors Service rates them Aa3.

Fitch said in August that its downgrade “reflects the mounting budgetary pressure presented by significant and growing funding needs for the state’s unfunded pension and employee benefit liabilities, particularly in the context of a weak economic recovery, a high debt burden, limited financial flexibility and persistent structural imbalance.”

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