                NOT FOR PUBLICATION WITHOUT THE
               APPROVAL OF THE APPELLATE DIVISION

                                     SUPERIOR COURT OF NEW JERSEY
                                     APPELLATE DIVISION
                                     DOCKET NO. A-3274-10T3
                                                 A-3868-10T3
                                                 A-3916-10T3
                                                 A-4086-10T3


TEAMSTERS LOCAL 97, affiliated
with the INTERNATIONAL BROTHERHOOD
OF TEAMSTERS, and PROFESSIONAL
FIREFIGHTERS ASSOCIATION OF NEW
JERSEY, I.A.F.F., AFL-CIO,               APPROVED FOR PUBLICATION

     Plaintiffs-Appellants,                  January 31, 2014

                                            APPELLATE DIVISION
v.

STATE OF NEW JERSEY, CHRISTOPHER J.
CHRISTIE, as Governor of the State
of New Jersey, THE NEW JERSEY SENATE
AND ITS MEMBERS, STEPHEN M. SWEENEY,
as its President and as a Representative
of the Individual Members of the New
Jersey Senate, THE NEW JERSEY GENERAL
ASSEMBLY AND ITS MEMBERS, SHEILA Y.
OLIVER, as its Speaker and as a
Representative of the Individual
Members of the New Jersey General
Assembly, and ANDREW P. SIDAMON-ERISTOFF,
Treasurer of the State of New Jersey,

     Defendants-Respondents.
_________________________________________________

NEW JERSEY STATE FIREFIGHTERS'
MUTUAL BENEVOLENT ASSOCIATION,
NEW JERSEY STATE POLICEMAN'S
BENEVOLENT ASSOCIATION, GLOUCESTER
CITY FMBA LOCAL NO. 51, NORTH
WILDWOOD FMBA LOCAL NO. 56, TRENTON
FMBA LOCAL NO. 6, KEARNY FMBA LOCAL
NO. 18, NEW BRUNSWICK FMBA LOCAL
NO. 17, BELLEVILLE FMBA LOCAL NOS.
29 AND 229, SPRINGFIELD FMBA LOCAL
57, SPRINGFIELD FMBA LOCAL 57A,
SOUTH ORANGE PBA LOCAL NO. 12, NEPTUNE
PBA LOCAL NO. 74, ESSEX COUNTY SHERIFF'S
OFFICERS PBA LOCAL NO. 183, KEYPORT PBA
LOCAL NO. 223, PASSAIC COUNTY SHERIFF'S
OFFICERS PBA LOCAL NO. 286, RUTHERFORD PBA
LOCAL NO. 300, PATERSON PBA LOCAL NO. 1 and
SUPERIOR OFFICERS ASS'N WILLIAM LAVIN, ROBERT
BROWER, and ANTHONY F. WEINERS,

     Plaintiffs-Appellants,

v.

STATE OF NEW JERSEY, NEW JERSEY
DEPARTMENT OF THE TREASURY, NEW JERSEY
STATE HEALTH BENEFITS COMMISSION,
ANDREW P. SIDAMON-ERISTOFF, TREASURER,
STATE OF NEW JERSEY, individually and
officially, NEW JERSEY STATE SENATE,
as a body politic of the State of New
Jersey, and NEW JERSEY STATE GENERAL
ASSEMBLY, as a body politic of the
State of New Jersey,

     Defendants-Respondents.
_________________________________________________

NEW JERSEY EDUCATION ASSOCIATION,

     Plaintiff-Appellant,

v.

STATE OF NEW JERSEY, CHRISTOPHER J. CHRISTIE,
as Governor of the State of New Jersey, NEW
JERSEY DEPARTMENT OF THE TREASURY, ANDREW P.
SIDAMON-ERISTOFF, TREASURER, STATE OF NEW
JERSEY, individually and officially,
NEW JERSEY STATE HEALTH BENEFITS COMMISSION,
NEW JERSEY SCHOOL EMPLOYEES HEALTH BENEFITS
COMMISSION, NEW JERSEY STATE SENATE, as a
body politic of the State of New Jersey,
STEPHEN M. SWEENEY, as President and as a
Representative of the Members of the New
Jersey State Senate, NEW JERSEY STATE GENERAL



                               2                    A-3274-10T3
ASSEMBLY, as a body politic of the State of
New Jersey, SHEILA Y. OLIVER, as its Speaker
and Representative of the Members of the
New Jersey General Assembly,

     Defendants-Respondents.
_________________________________________________

NEW JERSEY FRATERNAL ORDER OF POLICE,

     Plaintiff,

v.

STATE OF NEW JERSEY, NEW JERSEY DEPARTMENT
OF THE TREASURY, NEW JERSEY STATE HEALTH
BENEFITS COMMISSION, ANDREW P. SIDAMON-ERISTOFF,
TREASURER, STATE OF NEW JERSEY, individually and
officially, NEW JERSEY STATE SENATE, as a body
politic of the State of New Jersey, NEW JERSEY
STATE GENERAL ASSEMBLY, as a body politic of
the State of New Jersey,

     Defendants.
_________________________________________________

KEARNY FIREMEN'S MUTUAL BENEVOLENT
ASSOCIATION, LOCAL NO. 18,

     Plaintiff,

v.

TOWN OF KEARNY,

     Defendant.
_________________________________________________

BELLEVILLE FIREMEN'S MUTUAL BENEVOLENT
ASSOCIATION, LOCAL NOS. 29 & 229,

     Plaintiffs,

v.




                               3                    A-3274-10T3
TOWNSHIP OF BELLEVILLE,

     Defendant.
_________________________________________________

         Argued February 27, 2013 - Decided January 31, 2014

         Before Judges Sapp-Peterson, Nugent and Haas.

         On appeal from the Superior Court of New
         Jersey, Law Division, Mercer County, Docket
         Nos. L-1004-10, C-31-10, C-32-10, L-1291-10,
         L-2287-10, and L-2312-10.

         James   M.   Mets    argued   the   cause  for
         appellants     Teamsters     Local    97   and
         Professional Firefighters Association of New
         Jersey   (Mets    Schiro   &   McGovern,  LLP,
         attorneys; Mr. Mets, of counsel and on the
         brief; Brian J. Manetta, on the brief).

         David I. Fox argued the cause for appellants
         New   Jersey   State   Firefighters'   Mutual
         Benevolent   Association,   its  locals   and
         members (Fox and Fox, LLP, attorneys; Mr.
         Fox, Craig S. Gumpel, and Jessica S.
         Swenson, of counsel and on the brief).

         Paul L. Kleinbaum argued the cause for
         appellants New Jersey State Policemen's
         Benevolent   Association   (Zazzali   Fagella
         Nowak Kleinbaum & Friedman, attorneys; Mr.
         Kleinbaum, of counsel and on the brief;
         Edward M. Suarez, Jr., on the brief).

         Richard A. Friedman argued the cause for
         appellant New Jersey Education Association
         (Zazzali Fagella Nowak Kleinbaum & Friedman,
         attorneys; Mr. Friedman, of counsel and on
         the brief; Edward M. Suarez, Jr., on the
         brief).

         Robert T. Lougy, Assistant Attorney General,
         argued the cause for respondents State of
         New   Jersey,    Governor   Christopher   J.
         Christie, and Treasurer Andrew P. Sidamon-
         Eristoff   (Jeffrey   S.  Chiesa,   Attorney



                               4                          A-3274-10T3
             General, attorney; Mr.   Lougy, of counsel;
             Natalia T. Chan, Deputy Attorney General, on
             the brief).

             Leon   J.   Sokol  argued   the   cause   for
             respondents   New  Jersey   Senate,   General
             Assembly, Stephen M. Sweeney, and Sheila Y.
             Oliver (Sokol, Behot & Fiorenzo, attorneys;
             Mr. Sokol, of counsel; Steven Siegel, on the
             brief).

      This opinion of the court was delivered by

NUGENT, J.A.D.

      The   issues     in    these    consolidated            appeals     involve     public

employees of the State, its political subdivisions, and their

agencies.      As    compensation          for     their       services,      many    public

employees receive, among other benefits, health care insurance

and   pensions.        To    the    extent       the    employees       are   required       to

contribute    toward        their   benefits,          their    disposable      income      is

reduced.      Yet, the money that funds employee benefits is not

unlimited.     The State's officials are charged with the profound

responsibility not only of ensuring that the health care and

pension systems remain fiscally sound, but also that the State

remains     fiscally    strong       and   that        the    burden    on    the    State's

taxpayers does not become intolerable.                       The interests of public

employees    and    their     representatives            sometimes      clash       with   the

obligations    of    State     government.             Such    is   the      case    in    this

appeal.




                                             5                                       A-3274-10T3
    Plaintiffs, who represent state and local public employees

in collective negotiations with public employers, challenge the

constitutionality of three laws:                   L. 2010, c. 1 (Chapter 1),

which made changes to State-administered retirement systems; L.

2010,   c.   2   (Chapter   2),    which       made     changes     to    eligibility

requirements for and benefits provided through the State Health

Benefits Program (SHBP) and School Employees' Health Benefits

Program   (SEHBP);    and   L.    2010,       c.   3   (Chapter    3),    which   made

changes to other public employee benefits.                         The trial court

dismissed    plaintiffs'    consolidated           complaints      for    failure   to

state a claim.

    In these consolidated appeals, plaintiffs argue that the

trial court misapplied the standard for evaluating a motion to

dismiss a complaint under Rule 4:6-2(e) for failure to state a

claim upon which relief can be granted.                   Plaintiffs also argue

that the trial court erred when it concluded that Chapters 1, 2,

and 3 did not violate either the State or Federal Constitution.

Having considered plaintiffs' arguments in light of the record

and controlling law, we conclude that the trial court properly

construed     and    applied      Rule        4:6-2(e)      when     it     dismissed

plaintiffs'      complaints.      We   further         conclude    that   plaintiffs

have not carried their heavy burden of demonstrating that the

laws are unconstitutional.         Accordingly, we affirm.




                                          6                                  A-3274-10T3
                                          I.

     The plaintiffs in these consolidated appeals are Teamsters

Local 97 (Teamsters); the Professional Firefighters Association

of New Jersey (PFANJ); the New Jersey State Firefighters' Mutual

Benevolent Association (FMBA) and affiliated locals; the New Jersey

State Policeman's Benevolent Association (PBA) and affiliated

locals; and the New Jersey Education Association (NJEA).                            New

Jersey     Fraternal    Order      of   Police,       Kearny      Firemen's      Mutual

Benevolent Association, and Belleville Firemen's Mutual Benevolent

Association Local Nos. 29 and 229, parties to the actions that

were consolidated in the trial court, have not filed separate

appeals.      Defendants     are    the    State      of    New   Jersey,     Governor

Christopher J. Christie, the New Jersey Department of the Treasury

and State Treasurer Andrew P. Sidamon-Eristoff, the State Health

Benefits    Commission      (SHBC),     and     the     School    Employees      Health

Benefits     Commission         (SEHBC)       (collectively,        the     Executive

Defendants);    the     State    Senate    and    its      President,     Stephen    M.

Sweeney, and the State General Assembly and its Speaker, Sheila

Y. Oliver (collectively, the Legislative Defendants).

     Plaintiffs seek to have Chapters 1, 2, and 3 declared void

as unconstitutional.            Because courts assessing constitutional

challenges    to    state    legislation         must      consider,    among     other

factors,      the      governmental       interests          furthered      by      the




                                          7                                   A-3274-10T3
legislation, we begin our analysis with the legislative history

of Chapters 1, 2, and 3.       We also review the legislative history

of L. 2011, c. 78, which has superseded certain sections of

Chapter 2.

      On February 8, 2010, the Legislature introduced Senate Bill

Numbers 2, 3, and 4.      S. 2, 214th Leg. (N.J. 2010); S. 3, 214th

Leg. (N.J. 2010); S. 4, 214th Leg. (N.J. 2010).            The legislation

was "designed to improve the fiscal strength of State and local

governments, reduce taxpayer burdens, and ensure the health and

pension systems remain viable for current and future employees."

Commc'ns Workers of Am. v. State of N.J., Dept. of Treasury,

421 N.J. Super. 75, 83 (Law Div. 2011).

      The    three    Senate    bills    implemented       some        of    the

recommendations of a Special Session Joint Legislative Committee

on Public Employee Benefits Reform (Special Joint Committee),

while leaving other recommendations to collective negotiations.

See   Special   Session   Joint    Legislative     Comm.   on     Pub.      Emp.

Benefits    Reform,   Final    Report   (2006),    available      at    http://

www.njleg.state.nj.us/propertyTaxSession/JCPE_final_report.pdf.

The Special Joint Committee was created pursuant to a Concurrent

Resolution that declared "[t]his State's high property taxes are

a matter of great concern to the people of New Jersey."                Assemb.

Con. Res. 3, 212th Leg. (N.J. 2006).              The resolution created

four legislative committees, including one on public employee



                                    8                                  A-3274-10T3
benefits, tasked with developing proposals to reduce property

taxes.     N.J. Ass'n of Sch. Adm'rs v. Schundler, 211 N.J. 535,

540   (2012).       The       Special          Joint    Committee        was      specifically

"charged with identifying proposals that will terminate abuses

of the pension systems and control the cost of providing public

employee    retirement        health        care       and   other     benefits."         Final

Report, supra, at 1.

      In its final report, the Special Joint Committee found that

New   Jersey's     retirement         systems          had   an   $18    billion       unfunded

liability.       Ibid.     SHBP expenditures, which then totaled $3.6

billion annually, had risen by over 150% in the previous five

years and were expected to double by 2010.                              Ibid.        "State and

local    governments      will       soon       have    to    recognize        the    long-term

implications of these employee health care benefits on their

financial    statements         .     .    .    ."       Ibid.         The     Special    Joint

Committee    found       that       for    the       benefit      of    taxpayers,       public

employees,       retirees,      and       employers,         measures        to    ensure    the

fiscal    stability      of     the       retirement         system,     and      measures    to

control health care costs, needed to be implemented.                               Id. at 2.

      The Special Joint Committee recommended forty-one reforms

to public employee pensions, health care benefits, and other

employee benefits.         Id. at 2-5.               The recommendations identified

"long     term     savings          through          wide-ranging            reforms      while

maintaining the essential components of a competitive system of



                                                 9                                     A-3274-10T3
pensions and benefits[.]"     Id. at 2.   With regard to health care

costs, the Special Joint Committee's investigation of

           health benefits issues revealed a system
           plagued by the skyrocketing costs of health
           care that have dramatically increased the
           cost of health benefits for both current and
           retired public employees. The investigation
           also found that New Jersey public employees
           contribute less toward their health benefit
           costs than public employees of other states.
           The Joint Committee recommends that all
           employees share in the cost of their health
           benefits at some level and that local
           governments     be     accorded    increased
           flexibility when negotiating cost sharing
           with local employees.

           [Id. at 57.]

     The     Special       Joint    Committee    suggested,      under

Recommendations 22 and 23, that the Legislature require all active

public employees and future retirees "to pay some portion of the

cost of health care insurance premiums," id. at 4, but deferred

           to the various public employers and employee
           representatives to determine the appropriate
           level of premium sharing through collective
           bargaining.

           . . . The Benefits Review Task Force
           suggested that employees carry a share of 5%
           to 10%.    In order to recognize differences
           in ability to pay and to provide appropriate
           flexibility in negotiations, this could be
           achieved by mandating a certain overall
           percentage    employee   share,   with   the
           distribution of that share among income
           groups   to    be   subject   to  collective
           bargaining.

           [Id. at 115.]




                                   10                         A-3274-10T3
     Recommendation 25 suggested that the Legislature "[r]equire

that SHBP benefits changes negotiated by State be applied to

local governments."1    Id. at 4.    The Special Joint Committee

          recommend[ed] that legislation be enacted to
          ensure that basic changes made in the
          provisions   of   SHBP  benefits   to   State
          employees, such as the amount of copayments
          for office visits and prescription drugs, be
          applicable   at   the  same   time   to   all
          individuals covered by SHBP.

          The Joint Committee believes that it is
          important   that   SHBP   benefits    changes
          negotiated by the State with its employees
          be   applicable   to  employees    of   local
          employers not only to reduce administrative
          expenses for all through conformity but also
          to extend to those local employers the same
          cost savings enjoyed by the State.        The
          . . . Committee believes that it is
          important to ensure consistency in health
          benefit coverage and cost for all public
          employees.

          [Id. at 121-22.]

With regard to other benefits, Recommendation 36 suggested that

the Legislature "[l]imit sick leave compensation payable upon

retirement   to   $15,000,"   and    Recommendation   37    suggested     a

limitation on the accumulation of vacation leave.          Id. at 5.

     On March 22, 2010, Senate Bill Numbers 2, 3, and 4 were

signed into law (Chapters 1, 2, and 3).        They became effective

on May 21, 2010.       Chapter 1 made reforms to pension systems,

1
  SHBP is a multiple-option program that offers health benefits
coverage through a variety of plans and managed care programs.
Final Report, supra, at 121.



                                    11                           A-3274-10T3
Chapter 2 made reforms to health benefits programs, and Chapter

3    made   reforms      to     payments          for      employee         benefits,   including

accumulated sick leave and vacation time.

       The following sections of Chapters 1, 2, and 3 are central

to this appeal.              Chapter 1, Section 22 (codified at N.J.S.A.

43:16A-1) changed the definition of "final compensation" used in

calculating retirement benefits for persons who became members

of the Police and Fireman's Retirement System (PFRS) after the

law's effective date.                 Instead of defining "final compensation"

for such new members as compensation received in the last twelve

months of creditable service – the definition for members as of

the   effective         date    –     the       law    changed      the      meaning    of    "final

compensation"          for     such        new    members         to    "the    average       annual

compensation for service for which contributions are made during

any    three      fiscal       years       of    membership            providing      the    largest

possible benefit to the member or the member's beneficiary."

The Department of the Treasury estimated that Chapter 1 would

reduce      the    required          contribution            to     the      State-administered

retirement        systems       for    State          and    local      employers       "by     $13.2

million in State FY 2013, $25.3 million in FY 2014 and $40.9

million in FY 2015."                Fiscal Note to S. 2                 (June 3, 2010).          FMBA

is    the   only       plaintiff       who       has       argued      on    appeal    that     those

provisions        of    Chapter        1    are        unconstitutional,           though       other

plaintiffs have joined in FMBA's argument.



                                                      12                                     A-3274-10T3
    Chapter 2 made changes to the SHBP, as well as to the

SEHBP,   concerning   eligibility,    cost   sharing,   choice   of   plan,

application of benefit changes, waiver of coverage, and multiple

coverage.     Section 1 (codified in relevant part at N.J.S.A.

52:14-17.28b(c)(2))    required   participating     SHBP   employees     to

contribute toward the cost of health benefits coverage:

            Commencing    on   the    effective   date   of
            P.L.2010, c. 2 and upon the expiration of
            any     applicable      binding      collective
            negotiations agreement in force on that
            effective    date,    the    amount    of   the
            contribution required pursuant to paragraph
            (1) of this subsection by State employees
            and   employees   of   an   independent   State
            authority, board, commission, corporation,
            agency, or organization for whom there is a
            majority    representative     for   collective
            negotiations purposes shall be 1.5% of base
            salary, notwithstanding any other amount
            that may be required additionally pursuant
            to this paragraph by means of a binding
            collective negotiations agreement.

    Section 1 (codified in relevant part at N.J.S.A. 52:14-

17.28b(d)) also required retirees to contribute an amount equal

to "1.5% of the retiree's monthly retirement allowance," if the

retirees became "a member of a State or locally-administered

retirement system on or after the effective date of P.L.2010, c.

2[.]"    Section 6 (codified in relevant part at N.J.S.A. 52:14-

17.46.9(b)) required the same contribution of SEHBP employees,

"[c]ommencing on the effective date of P.L.2010, c. 2 and upon




                                     13                           A-3274-10T3
the expiration of any applicable binding collective negotiations

agreement in force on that effective date[.]"

    The State Department of the Treasury, Division of Pensions

and Benefits (DPB) estimated that contributions by active and

retired public employees (the 1.5% contribution) under Chapter 2

toward   the   cost   of   health   care   benefits    would    "result   in   a

savings to those entities and boards of $314 million in State

Fiscal Year 2011, $324 million in Fiscal Year 2012, and $333

million in Fiscal Year 2013."          Fiscal Note to S. 3          (March 1,

2010).

    Chapter     2,    Section   8   (amending   N.J.S.A.       52:14-17.36(b))

(the Section 8 Applicability Provision),              made those changes in

health   care    benefits       included   in   collective       negotiations

agreements between the State and its employees applicable to

other public employers and employees:

           All changes in the provision of health care
           benefits   through   the   program   that   are
           included     in    collective      negotiations
           agreements   between   the    State   and   its
           employees entered into on or after the
           effective date of P.L.2010, c. 2 shall be
           made   applicable   by   the    commission   to
           participating employers and their employees
           at the same time and in the same manner as
           to State employees.     This subsection shall
           be applicable to the [SHBP] . . . and to the
           [SEHBP] . . . to the extent not inconsistent
           with the provisions of . . . P.L.2007, c.
           103 (C.52:14-17.46.1 et seq.).




                                      14                              A-3274-10T3
    Chapter 2, Section 11 (amending N.J.S.A. 52:14-17.31a(c)),

provides that in consideration for a waiver of health insurance,

an employer may pay to the employee an amount not to exceed 25%

of the cost saved by the employer, or $5000, whichever is less.

     To aid public employers in interpreting Chapter 2, the DPB

issued a document entitled "Frequently Asked Questions Regarding

Chapter   2,   P.L.2010    and   Changes   to   Public   Employee    Health

Benefits" (DPB's FAQs).      The questions and answers included the

following:

           2. Q. Is the 1.5% of base pay contribution
           in addition to previously negotiated premium
           contributions?

               A.    No.     The 1.5% contribution is
           intended   to  be   a   floor,  or   minimum,
           contribution that an employee will make
           toward medical and/or prescription drug plan
           coverage. If        another      contribution
           arrangement has been negotiated, the higher
           of the two will prevail. All employees must
           contribute an amount equivalent to at least
           1.5% of the employee's base pay. . . .

                 . . . .

           4. Q. On what salary is the calculation of
           the 1.5% contribution based?

               A.    The calculation is based on the
           employee's base contractual salary. In most
           instances, that means the salary on which
           pension contributions are based.    However,
           for employees hired after July of 2007 for
           whom pensionable salary is limited to the
           salary     on    which    Social    Security
           contributions are based, the employee's
           total base salary would be used.      As an
           employee receives salary increases during



                                    15                              A-3274-10T3
            the year, the amount of contribution would
            need to be adjusted accordingly.

                  . . . .

            6. Q. Our union contract expired last year
            and has not been settled.         Will these
            employees be required to contribute the 1.5%
            contribution after May 21st [2010]?

                A. If the contract is not ratified by
            May 21st, those employees will be required
            to pay the 1.5% contribution for health
            coverage.    If the contract is ratified
            before May 21st, those employees will not be
            required to pay the 1.5% contribution until
            the expiration of the contract.

                  . . . .

            10.    Q. Will non-SHBP/SEHBP participating
            employers be required to follow the 1.5%
            minimum contribution?

                A. Yes.     Chapter 2 stipulates that
            employees   of  non-participating   employers
            must pay a minimum of 1.5% of annual base
            salary as a health benefits contribution.

                  . . . .

            17.   Q. Will employees who waive coverage
            still have to pay 1.5% towards health
            benefit costs as all local employees and
            then receive waiver incentive based on the
            reduced employer cost?

                A. No. An employee who waives coverage
            is   not    required to   pay   the   1.5%
            contribution.

    On     May   18,   2010,   the   Department   of   Community   Affairs,

Division    of   Local   Government    Services   (DLGS),   issued    Local

Finance Notice 2010-12 (LFN 2010-12), based on the materials




                                      16                           A-3274-10T3
issued by the DPB, which also provided guidance for complying

with    Chapter    2     for    both    SHBP    and    non-SHBP      local    units,    and

included answers to "Frequently Asked Questions."

       Plaintiffs assert that the foregoing provisions of Chapter

2, particularly those that require the 1.5% contribution and

those    that     bind      local      employees      to   changes      in   health    care

benefits negotiated by State employees, violate various rights

guaranteed by the State and Federal Constitutions.

       Chapter 3 made

              various   changes   concerning   payments   to
              public employees for unused sick leave, sick
              leave for injury while in State service, and
              accidental     and     ordinary     disability
              retirement   for   members   of   the   Public
              Employees’ Retirement System (PERS) and the
              Teachers Pension and Annuity Fund (TPAF).
              The bill also limits to one year the amount
              of   vacation   leave   that   certain   local
              government and school district officers and
              employees   would   be  permitted   to   carry
              forward, under most circumstances.

              [S.   State   Gov't   Wagering,  Tourism  &
              Historical Preservation Comm., Statement to
              S. 4 (Feb. 18, 2010).]

       FMBA     challenges        as    unconstitutional          the    provisions     of

Chapter 3, Sections 1 and 2 (codified at N.J.S.A. 11A:6-19.2 and

N.J.S.A.      40A:9-10.4),          that      prohibit      the    State's     political

subdivisions, agencies, and authorities from paying supplemental

compensation      to     officers       or    employees     for   accumulated     unused

sick    leave    in    an      amount    in    excess      of   $15,000.       FMBA    also




                                               17                                A-3274-10T3
challenges the provisions of Section 4 (codified at N.J.S.A.

40A:9-10.5) that prohibit officers and employees "of a political

subdivision         of     the       State,        or   an    agency,    authority,         or

instrumentality thereof, that has not adopted the provisions of

Title    11A    of       the       New    Jersey    statutes,"    from       carrying    over

accrued vacation leave beyond the next succeeding year.

       On    June        28,       2011,     after      the   trial     court       dismissed

plaintiffs' complaints, the Legislature enacted the Pension and

Health Care Benefits Act, L. 2011, c. 78 (Chapter 78) (codified

in relevant part at N.J.S.A. 52:14-17.28c to -17.28d, N.J.S.A.

18:16-17.1, and N.J.S.A. 40A:10-21.1), which requires all public

employees      to    pay       a    sliding    scale     percentage     of    the    cost   of

health      benefits       for           themselves     and   their     dependents,         but

maintains a "floor" for employee contributions of 1.5% of base

salary.      S. Budget & Appropriations Comm., Statement to S. 2937

(June 16, 2011).           See DePascale v. State, 211 N.J. 40, 45 (2012)

(addressing challenge to Chapter 78 as applicable to justices

and judges).

       Section 45 (codified in relevant part at N.J.S.A. 52:14-

17.27(b)) established the SHBP Design Committee and vested it

with

               the responsibility for and authority over
               the various plans and components of those
               plans,   including  for  medical  benefits,
               prescription benefits, dental, vision, and
               any other healthcare benefits, offered and



                                                   18                                A-3274-10T3
         administered by the program.    The committee
         shall have the authority to create, modify,
         or terminate any plan or component, at its
         sole discretion.    Any reference in law to
         the State Health Benefits Commission in the
         context of the creation, modification, or
         termination of a plan or plan component
         shall be deemed to apply to the committee.

    Similarly,    Section    46    (codified    in   relevant   part     at

N.J.S.A. 52:14-17.46.3(e)) established a SEHBP Design Committee

and vested it with

         the responsibility for and authority over
         the various plans and components of those
         plans,   including   for  medical   benefits,
         prescription benefits, dental, vision, and
         any other healthcare benefits, offered and
         administered by the program.    The committee
         shall have the authority to create, modify,
         or terminate any plan or component, at its
         sole discretion.    Any reference in law to
         the   School   Employees'   Health   Benefits
         Commission in the context of the creation,
         modification, or termination of a plan or
         plan component shall be deemed to apply to
         the committee.

    Section 47 (codified in relevant part at N.J.S.A. 52:14-

17.29(J)) provides that "[n]otwithstanding any other provision

of law to the contrary the [SHBP Design Committee] shall have

the sole discretion to set the amounts for maximums, co-pays,

deductibles, and other such participant costs for all plans in

the program."    Section 49 (codified in relevant part at N.J.S.A.

52:14-17.46.7)    provides   the     SEHBP     Design   Committee      with

identical discretion.




                                   19                           A-3274-10T3
       The State argues that Chapter 78 supersedes and renders

moot    plaintiffs'         constitutional         challenges    to    the     Section       8

Applicability Provision.

       As noted previously, the Governor signed Chapters 1, 2, and

3 into law on March 22, 2010.                     The following month, plaintiffs

filed       complaints       seeking       injunctive        relief    and        judgments

declaring the laws unconstitutional and unenforceable.                               Several

plaintiffs        later     amended      their     complaints.        Judge       Linda    R.

Feinberg denied plaintiffs' motions for injunctive relief and

also denied motions by the Senate and Assembly to dismiss the

complaints against them.

       Thereafter, defendants moved to dismiss the consolidated

complaints for failure to state a claim upon which relief can be

granted.          FMBA     cross-moved      for    summary    judgment.           Following

argument, Judge Feinberg issued a comprehensive written opinion

granting      defendants'        motions      and    dismissing       the     complaints.

This appeal followed.

                                             II.

       We    first    address       plaintiffs'      contentions       that       the   court

misapplied the standard of review for dismissing a complaint for

failure      to    state    a   claim      upon    which   relief     can    be     granted.

Plaintiffs         argue     that    the     court    misapplied       the     applicable

standard      by     improperly       considering      material       outside        of   the

pleadings.         According        to     plaintiffs,        because         the       court



                                              20                                    A-3274-10T3
considered        external     materials,         it    should    have       treated     the

motions as summary judgment motions and given the parties an

opportunity        to   take    discovery.          Plaintiffs       also     argue     that

instead of evaluating the complaints to determine whether they

suggested     a     cause      of    action,      the    court     made      factual      or

substantive determinations.

      The standard a trial court must apply when considering a

Rule 4:6-2(e) motion to dismiss a complaint for failure to state

a claim upon which relief can be granted is "whether a cause of

action is 'suggested' by the facts."                     Printing Mart-Morristown

v. Sharp Elecs. Corp., 116 N.J. 739, 746 (1989).                         "In evaluating

motions     to     dismiss,         courts    consider       'allegations          in    the

complaint, exhibits attached to the complaint, matters of public

record,     and     documents        that    form      the   basis      of    a    claim.'"

Banco Popular N. Am. v. Gandi, 184 N.J. 161, 183 (2005) (quoting

Lum v. Bank of Am., 361 F.3d 217, 221 n.3 (3d Cir.), cert.

denied, 543 U.S. 918, 125 S. Ct. 271, 160 L. Ed. 2d 203 (2004)).

Our Supreme Court has explained that "[i]t is the existence of

the fundament of a cause of action in those documents that is

pivotal[.]"       Ibid.

      A motion to dismiss a complaint for failure to state a

claim "may not be denied based on the possibility that discovery

may establish the requisite claim; rather, the legal requisites

for   plaintiffs'       claim       must     be   apparent       from    the      complaint



                                             21                                    A-3274-10T3
itself."        Edwards     v.     Prudential          Prop.    &     Cas.      Co.,    357    N.J.

Super.    196,       202    (App.        Div.),    certif.       denied,        176     N.J.    278

(2003).      For     that    reason,        our       courts    have      not       hesitated    to

dismiss      complaints          with       prejudice          when       a     constitutional

challenge fails to state a claim.                         See J.D. ex rel. Scipio-

Derrick v. Davy, 415 N.J. Super. 375, 397 (App. Div. 2010).

      When      we   review      a       trial    court's      decision         to     dismiss    a

complaint under Rule 4:6-2(e), we apply the same standard but

our review is de novo.               Frederick v. Smith, 416 N.J. Super. 594,

597 (App. Div. 2010), certif. denied, 205 N.J. 317 (2011).                                       We

conclude from our de novo review of the record on appeal that

the trial court correctly stated and applied the standard of

review    for    evaluating          a    Rule    4:6-2(e)       motion.             Contrary    to

plaintiffs' arguments, the court did not engage in factfinding

and   did    not      improperly          consider       materials            outside    of     the

pleadings.           Plaintiffs'          arguments       are,      for       the    most     part,

unsupported by the record.                   Their arguments also overlook our

Supreme Court's pronouncement about what materials a trial court

may consider when evaluating a motion to dismiss a complaint for

failure to state a claim.

      In her opinion, Judge Feinberg stated explicitly that she

had   considered            "the         pleadings,        the        relevant          statutes,

regulations and cases cited by the parties."                                   She noted that

FMBA had included in its "application for injunctive relief . . .



                                                 22                                      A-3274-10T3
a   large     notebook      consisting     of      approximately         four     hundred

pages."       The judge also noted that FMBA and PBA had submitted

certifications.         Acknowledging          that     she     had     "reviewed      the

certifications         in    reaching      a     decision       whether     to      grant

injunctive       relief,"    Judge     Feinberg        stated    that    "neither      the

certifications nor material in the notebook has been considered

in deciding the motion to dismiss."

       Plaintiffs identify only three sources of information they

claim     the     judge     improperly     considered:          the     Special     Joint

Committee's final report, the DPB FAQs, and a DPB website.                             But

FMBA    and     PBA   referred    at   length     in    their    complaints       to   the

Special Joint Committee's final report and to DPB's FAQs, and no

plaintiff       has    alleged    that    the     DPB     website       contained      any

materials that were both relied upon by the trial court and

significantly         different   in     content       from   the     content     of   the

Special Joint Committee report and DPB FAQs.                          Because FMBA and

PBA referred to the Special Joint Committee report and DPB FAQs

in their complaint, the court properly considered them under

Rule 4:6-2(e).          See In re Burlington Coat Factory Sec. Litig.,

114 F.3d 1410, 1426 (3d. Cir. 1997); E. Dickerson & Son, Inc. v.

Ernst & Young, LLP, 361 N.J. Super. 362, 365 n.1 (App. Div.

2003), aff'd, 179 N.J. 500 (2004); N.J. Sports Prods., Inc. v.

Bobby Bostick Promotions, LLC, 405 N.J. Super. 173, 178 (Ch.

Div. 2007).



                                          23                                     A-3274-10T3
       Aside from FMBA's and PBA's discussions in their complaints

of     materials    they   now      suggest    the    court       should    not     have

considered,        no   plaintiff     disputes       that    the    Special        Joint

Committee report and DPB FAQs are matters of public record.                           See

Hall v. Virginia, 385 F.3d 421, 424 n.3 (4th Cir. 2004) (noting

that the court can consider publicly available statistics on

Virginia Division of Legislative Services' official website),

cert. denied, 544 U.S. 961, 125 S. Ct. 1725, 161 L. Ed. 2d 602

(2005).      Plaintiffs'      arguments       overlook      our    Supreme       Court's

explicit    statement      that   courts      evaluating     motions       to   dismiss

under Rule 4:6-2(e) may consider, in addition to the complaint

and its attachments, matters of public record.                     Banco Popular N.

Am., supra, 184 N.J. at 183.            Accordingly, we reject plaintiffs'

argument that the trial court misapplied the applicable standard

when it granted defendants' Rule 4:6-2(e) motions.

                                        III.

       Plaintiffs next argue that defendants' motions should have

been     denied,    and    FMBA's     cross-motion       for      summary       judgment

granted, because Chapters 1, 2, and 3 are unconstitutional, and

their complaints so stated.             While addressing those arguments,

we bear in mind the following fundamental principles.                           Statutes

are presumed to be constitutional.                DePascale, supra, 211 N.J.

at 63.    This is because




                                         24                                     A-3274-10T3
         [i]n our tripartite form of government
         [judicial review of legislation] has always
         been exercised with extreme self-restraint,
         and   with   a   deep   awareness  that   the
         challenged     enactment    represents    the
         considered action of a body composed of
         popularly elected representatives.      As a
         result, judicial decisions from the time of
         Chief Justice Marshall reveal an unswerving
         acceptance of the principle that every
         possible presumption favors the validity of
         an act of the Legislature. . . . [A]ll the
         relevant New Jersey cases display faithful
         judicial deference to the will of the
         lawmakers whenever reasonable men might
         differ as to whether the means devised by
         the Legislature to serve a public purpose
         conform to the Constitution.

         [N.J. Sports & Exposition Auth. v. McCrane,
         61 N.J. 1, 8 (citation omitted), appeal
         dismissed sub nom., Borough of E. Rutherford
         v. N.J. Sports & Exposition Auth., 409 U.S.
         943, 93 S. Ct. 270, 34 L. Ed. 2d 215
         (1972).]

    For those reasons, a statute "will not be declared void

unless it is clearly repugnant to the Constitution."     Trautmann

ex rel. Trautmann v. Christie, 211 N.J. 300, 307 (2012) (quoting

Newark Superior Officers Ass'n v. City of Newark, 98 N.J. 212,

222 (1985)).   A party seeking to rebut "[t]he strong presumption

of constitutionality that attaches to a statute . . . [must]

show[] that the statute's 'repugnancy to the Constitution is

clear beyond a reasonable doubt.'"    Hamilton Amusement Ctr. v.

Verniero, 156 N.J. 254, 285 (1998) (quoting Harvey v. Bd. of

Chosen Freeholders, 30 N.J. 381, 388 (1959)), cert. denied, 527




                               25                         A-3274-10T3
U.S.    1021,       119    S.   Ct.    2365,     155    L.    Ed.   2d     770      (1999).

Plaintiffs have failed to carry that heavy burden.

                                            A.

       Plaintiffs first contend that the court erred in dismissing

the counts in their complaints alleging that Chapter 2 violates

Article I, Paragraph 19 of the New Jersey Constitution.                                  That

provision     states       as   to    public     employees:    "Persons        in     public

employment shall have the right to organize, present to and make

known to the State, or any of its political subdivisions or

agencies, their grievances and proposals through representatives

of their own choosing."

       Plaintiffs chiefly challenge the 1.5% contribution required

by Chapter 2, and the Section 8 Applicability Provision.                                   In

addition, FMBA argues that Chapter 3, Sections 1, 2, and 4,

violate Article I, Paragraph 19.                    Plaintiffs contend that the

trial court erred by dismissing these claims under Rule 4:6-

2(e).

       The   State        Executive     Defendants       assert     that    Chapter          2

respects the rights guaranteed to public employees by Article I,

Paragraph 19 of the State Constitution, and that the trial court

did not err by dismissing plaintiffs' challenges to Chapter 2

under Rule 4:6-2(e) because their challenges presented legal,

not    factual,      issues.          The   State      Executive    Defendants          also

contend      that     plaintiffs'       argument       that   Chapter      2     violates



                                            26                                      A-3274-10T3
Article    I,     Paragraph           19    of     the    State       Constitution          is     moot

because it has been superseded by Chapter 78.                                        Further, the

State   Executive            Defendants          contend       that     all     of    plaintiffs'

arguments that the Section 8 Applicability Provision violates

various federal and state constitutional protections are moot

because     the     Section            8     Applicability            Provision          has       been

superseded by Chapter 78.

      We agree with the State Executive Defendants that Chapter

78 renders plaintiffs' challenges to the Section 8 Applicability

Provision       moot.          With        the     enactment       of     Chapter          78,      the

Legislature       has        vested    the       Design       Committees      with       the     "sole

discretion"        to        create,       modify,        or     terminate         any      plan     or

component, as well as to set amounts for maximums, co-pays,

deductibles, and other participant costs for all plans offered.

The   "sole     discretion"            of    the        Design    Committees          to     create,

modify,    or     terminate           any    plan        includes       plans      for      "medical

benefits, prescription benefits, dental, vision, and any other

healthcare benefits."                L. 2011, c. 78, §§ 45 and 46.

      In    view        of     the     Legislature's             vesting      in      the      Design

Committees the sole discretion to make changes in the respective

healthcare plans, such changes are no longer effectuated through

collective      negotiations           between          the    State    and     its      employees.

The   provisions         of    Chapter       78     have       superseded       the      Section      8

Applicability            Provision.              "[C]ourts         should            not         reach



                                                   27                                       A-3274-10T3
constitutional questions unless necessary to the disposition of

the litigation."         O'Keefe v. Passaic Valley Water Comm'n, 132

N.J. 234, 240 (1993).          Because they are moot, we decline to

address plaintiffs' challenges to the Section 8 Applicability

Provision.

     We turn to plaintiffs' arguments that the provisions of

Chapter   2    requiring    the   1.5%   contribution,   as   well    as   the

provisions of Chapter 3 limiting both supplemental compensation

for accumulated sick time and the carrying-forward of vacation

time, violate the constitutional right of public employees to

organize and to present their grievances and proposals through

their chosen representatives.        We are unpersuaded by plaintiffs'

arguments.

     To implement the constitutional right of public employees

to   organize      and     present   grievances    and   proposals,        the

Legislature enacted the New Jersey Employer-Employee Relations

Act (EERA),       N.J.S.A. 34:13A-1 to -43.        The EERA defines the

scope of public employees' rights of collective negotiation.                 In

re Local 195, IFPTE, AFL-CIO, 88 N.J. 393, 401 (1982).               N.J.S.A.

34:13A-5.3 provides in part that

              Representatives designated or selected by
              public   employees   for   the   purposes   of
              collective negotiation by the majority of
              the employees in a unit . . . shall be the
              exclusive   representatives   for   collective
              negotiation    concerning   the    terms   and




                                     28                              A-3274-10T3
                 conditions of employment of the employees in
                 such unit. . . .

       The       scope    of    collective        negotiations      by    public      sector

employees concerning "the terms and conditions of employment" is

not,   however,          unlimited.        See    Lullo   v.   Int'l     Ass'n       of   Fire

Fighters, 55 N.J. 409, 440 (1970).

                 [A] subject is negotiable between public
                 employers and employees when (1) the item
                 intimately and directly affects the work and
                 welfare of public employees; (2) the subject
                 has not been fully or partially preempted by
                 statute or regulation; and (3) a negotiated
                 agreement would not significantly interfere
                 with   the   determination   of  governmental
                 policy.    To decide whether a negotiated
                 agreement would significantly interfere with
                 the determination of governmental policy, it
                 is necessary to balance the interests of the
                 public     employees     and    the    public
                 employer. When the dominant concern is the
                 government's    managerial   prerogative   to
                 determine policy, a subject may not be
                 included in collective negotiations even
                 though it may intimately affect employees'
                 working conditions.

                 [In re Local 195, supra, 88 N.J. at 404-05.]

       We    agree       with   Judge      Feinberg   that     although     health        care

benefits are a negotiable term or condition of employment under

the EERA, the Legislature has preempted negotiation of the 1.5%

contribution.            "As a general rule, an otherwise negotiable topic

cannot      be    the     subject     of    a    negotiated    agreement        if     it   is

preempted        by   legislation."             Bethlehem    Twp.   Bd.    of    Educ.      v.

Bethlehem Twp. Educ. Ass'n., 91 N.J. 38, 44 (1982).                             A topic is




                                                 29                                  A-3274-10T3
preempted      if    a    "regulation      fixes    a   term   and    condition     of

employment      'expressly,            specifically      and   comprehensively.'"

Ibid.    (quoting Council of N.J. State College Locals v. State

Bd. of Higher Educ., 91 N.J. 18, 30 (1982)).                     The Legislature

has   fixed    the       1.5%    contribution    "expressly,    specifically       and

comprehensively."2

      PBA     does    not       dispute   that   the    Legislature    may   preempt

negotiations on a term or condition of employment, but argues

that the implementation of Chapter 2 to certain matters being

arbitrated under the Police and Fire Public Interest Arbitration

Reform Act (Reform Act), N.J.S.A. 34:13A-14 to -21, violates the

constitutional right of public employees to present grievances

through their chosen representatives.                   Specifically, PBA argues

that in interest arbitrations where "the arbitral records were

closed prior to the new laws' effective date," representatives

were effectively "precluded from submitting evidence over the

impact of new law to the interest arbitrator."                  We disagree.

      To begin with, Article 1, Paragraph 19 guarantees to public

employees the right to present their grievances and proposals to

"the State, or any of its political subdivisions or agencies."

The   Supreme       Court       has   interpreted   this   paragraph's       language


2
  The contribution amount was changed in Chapter 78. Chapter 78,
Section   39   requires   health-care   contributions based   on
employees' earning levels. See N.J.S.A. 52:14-17.28c.



                                            30                               A-3274-10T3
concerning public employees "to impose on the employer in the

public sector only the duty to meet with its employees or their

chosen    representatives        and   to    consider    in       good    faith    any

grievance       or   proposals   presented    on   their      behalf."         Lullo,

supra, 55 N.J. at 416.           Interest arbitrators are not employers.

Rather,      interest       arbitrators        conduct        an         "essentially

adversarial"         process,    "a    statutory    method          of     resolving

collective-negotiation disputes."              Hillsdale PBA Local 207 v.

Borough of Hillsdale, 137 N.J. 71, 80, 82 (1994).3

       Additionally,        arbitrators      rendering        a      decision       in

compulsory interest arbitration cases must apply the relevant

law.     Paterson Police PBA Local 1 v. City of Paterson, ___ N.J.

Super. ___, ___ (App. Div. 2013) (slip op. at 17).                          See also

Kearny PBA Local # 21 v. Town of Kearny, 81 N.J.                            208, 217

(1979).     They must "decide the dispute based on a reasonable

determination of the issues, giving due weight to those factors

listed    [in    N.J.S.A.    34:13A-16(g)(1)-(9)]."           N.J.S.A.        34:13A-

16(g).     If an arbitrator requires additional evidence as to any

factor, the arbitrator "may request the parties to supplement

their presentations,"           PBA Local 207, supra, 137 N.J. at 83-84,

3
  PBA Local 207 involved certain interest arbitration procedures
that were later eliminated from the Reform Act.   In re City of
Camden, 429 N.J. Super. 309, 328 n.7 (App. Div.), certif.
denied, 215 N.J. 485 (2013). Nevertheless, "the principles set
forth in [PBA Local 207] remain controlling." Ibid.




                                        31                                   A-3274-10T3
but "the arbitrator need not require the production of evidence

on each factor."          Id. at 84.

       Arbitrators are vested with significant discretion in the

manner      in    which     they       conduct      hearings.            For   example,    an

arbitrator may "conduct hearings, and require the attendance of

such     witnesses        and    the     production        of     such     books,   papers,

contracts, agreements, and documents as the arbitrator may deem

material to a just determination of the issues in dispute,"

N.J.A.C.         19:16-5.7(e);         grant     adjournments,           N.J.A.C.     19:16-

5.7(j); permit the parties to submit post-hearing briefs and

grant the parties special permission to introduce new factual

material in the post-hearing briefs.                   N.J.A.C. 19:16-5.7(l).

       PBA has cited no authority suggesting that in those limited

instances where a new law has been enacted after parties have

presented        evidence       in     interest      arbitration          proceedings     but

before the arbitrators have rendered decisions, and the new law

might affect pending issues, arbitrators cannot exercise their

discretion to have the parties submit supplemental briefs or new

evidence.         We discern no reason for prohibiting arbitrators from

so exercising their discretion in such limited circumstances.

Nor    do    we     discern      any     reason      why    the     parties     should     be

prohibited         from    requesting          permission       from      arbitrators      to

supplement their presentations in such limited circumstances.




                                               32                                   A-3274-10T3
Of     course,      arbitrators        may   reject      such   requests     if    the

arbitrators deem supplemental submissions unnecessary.

       Neither the language of the State Constitution, nor our

Supreme Court's decisions concerning the obligations Article I,

Paragraph      19    imposes      on    public       employers,   supports        PBA's

argument that Chapter 2 violates this constitutional provision.

In view of those considerations, PBA has not demonstrated either

that Chapter 2 violates Article I, Paragraph 19 of the State

Constitution, or that Judge Feinberg erred when she dismissed

plaintiffs' complaints for failure to state a claim.

                                             B.

       We turn to plaintiffs' contentions that the provisions of

Chapter 2 requiring public employees and retirees to make the

1.5% contribution violate the equal protection guarantees of the

Federal and State Constitutions.                  We are unpersuaded.

       The Fourteenth Amendment to the United States Constitution

provides that "[n]o State shall make or enforce any law which

shall . . . deny to any person within its jurisdiction the equal

protection of the laws."               "The Equal Protection Clause directs

that    'all     persons   similarly         circumstanced      shall   be   treated

alike.'"       Plyler v. Doe, 457 U.S. 202, 216, 102 S. Ct. 2382,

2394, 72 L. Ed. 2d 786, 798 (1982) (quoting F. S. Royster Guano

Co. v. Virginia, 253 U.S. 412, 415, 40 S. Ct. 560, 562, 64 L.

Ed.    989,    991    (1920)).     However,        the   "legislature   must       have



                                             33                              A-3274-10T3
substantial latitude to establish classifications that roughly

approximate      the     nature       of     the     problem    perceived,          that

accommodate competing concerns both public and private, and that

account for limitations on the practical ability of the State to

remedy every ill."           Id. at 216, 102 S. Ct. at 2394, 72 L. Ed. 2d

at   798-99.         Thus,    "[i]f    a     statutory     distinction      has     some

reasonable basis, 'a State does not violate the Equal Protection

Clause merely because the classifications made by its laws are

imperfect.'"         Whitaker v. Devilla, 147 N.J. 341, 358 (1997)

(quoting Dandridge v. Williams, 397 U.S. 471, 485, 90 S. Ct.

1153, 1161, 25 L. Ed. 2d 491, 501 (1970)).                     Accord Caviglia v.

Royal   Tours    of    Am.,    178    N.J.    460,   480    (2004).        "Under      the

federal      equal     protection      clause,       absent    an     impact      on    a

fundamental right or targeting of a suspect class, a statute

must be upheld 'so long as it bears a rational relation to some

legitimate end.'"            Trautmann, supra, 211 N.J. at 304 (quoting

Romer v. Evans, 517 U.S. 620, 631, 116 S. Ct. 1620, 1627, 134 L.

Ed. 2d 855, 865 (1996)).

      Our State Constitution does not contain an equal protection

clause.   State v. Chun, 194 N.J. 54, 101, cert. denied, 555 U.S.

825, 129 S. Ct. 158, 172 L. Ed. 2d 41 (2008).                    Yet, the concept

of   equal     protection       is    implicit       in    Article    I,    Paragraph

1.   McKenney v. Byrne, 82 N.J. 304, 316 (1980); Guaman v. Velez

(Guaman I), 421 N.J. Super. 239, 267 (App. Div. 2011).                                 In



                                           34                                  A-3274-10T3
analyzing      equal    protection        challenges           under      the      State

Constitution, courts apply "a more flexible balancing test that

considers three factors:           '(1) the nature of the right asserted;

(2) the extent to which the statute intrudes upon that right;

and (3) the public need for the intrusion.'"                      Guaman I, supra,

421 N.J. Super. at 267 (quoting State v. O'Hagen, 189 N.J. 140,

164 (2007)).      Although this analysis differs from the "federal

tiered approach, the tests weigh the same factors and often

produce the same result."           Sojourner A. v. N.J. Dep't of Human

Servs., 177 N.J. 318, 333 (2003).

       Plaintiffs contend the sections of Chapter 2 that require

the    1.5%   contribution      violate       the    federal     and    state      equal

protection        guarantees        because          they      create      arbitrary

classifications among employees.              For example, NJEA asserts that

the    1.5%    contribution        "applies         to   all     public    employees

regardless of the type or level of coverage applicable to the

individual    employee,    or      the   actual      cost   of    coverage      to     the

employer."     According to NJEA, under that scheme, an employee

opting for single coverage would pay the same "mandatory minimum

contribution as an employee opting for family coverage."                             NJEA

also    asserts     that     the     1.5%      contribution         will        have     a

disproportionate impact on public employees "at the lower end of

the income spectrum."          Teamsters add that public employees who

receive benefits "from a private insurer or from a union benefit



                                         35                                     A-3274-10T3
fund"   are    required    to    pay   the    1.5%    contribution     to    offset

employer health care costs even though they receive no benefits

from the employer plans.

     Chapter 2 does not, however, affect a fundamental right or

target a suspect class.4         The law does, on the other hand, bear a

rational      relation    to    legitimate        State   interests.           Those

interests include controlling the cost of providing health care

benefits to public employees; reducing administrative expenses;

and ensuring consistency in health benefit coverage and costs

for public employees.           Moreover, the changes in Chapter 2 are

part of legislation enacted to improve the fiscal strength of

State and local governments; reduce taxpayer burdens; and ensure

that the health and pension systems remain viable for current

and future employees.

     Moreover,     the     provisions        of    Chapter   2   are   rationally

related to those State interests, as is evident from the DPB

estimates that the required contributions will result in savings

of hundreds of millions of dollars.                Though perhaps an imperfect

scheme because imposing the 1.5% contribution may have different

4
   NJEA asserts that the Section 8 Applicability Provision
violates equal protection guarantees because it infringes upon
public employees' fundamental right, under Article I, Paragraph
19 of the State Constitution, to present grievances to their
employers through their chosen representatives.        We have
previously explained that plaintiffs' challenges to the Section
8 Applicability Provision are moot.   We will not address those
claims again.



                                        36                                  A-3274-10T3
consequences for some classes of employees, perfection is not

required.     Chapter 2 falls well within the legislative "latitude

to establish classifications that roughly approximate the nature

of the problem perceived, that accommodate competing concerns

both public and private, and that account for limitations on the

practical ability of the State to remedy every ill."                            Plyler,

supra, 457 U.S. at 216, 102 S. Ct. at 2394, 72 L. Ed. 2d at 798-

99.

      Similarly, Chapter 2 satisfies Article 1, Paragraph 1 of

the   New    Jersey    Constitution.          "There       is,   in   this    case,    an

'appropriate      governmental      interest      suitably       furthered      by    the

differential treatment involved.'"                Trautmann, supra, 211 N.J.

at 305 (quoting Barone v. Dep't of Human Servs., 107 N.J. 355,

368 (1987)).          As we have stated, the State has a legitimate

interest     in   controlling      the   cost     of       health     care    benefits,

ensuring     consistency     in    health     benefit      coverage,     and    further

ensuring     that     the   programs     that    make       health     care    coverage

available to public employees remain viable for both current and

future      employees.       The    State       has    a    further     interest       in

minimizing taxpayer burdens.

      For the reasons we have previously explained, the State's

interests are furthered considerably by the 1.5% contribution

requirement.        And considering the need to ensure that health

care programs remain viable for future as well as current public



                                         37                                    A-3274-10T3
employees and retirees, the intrusion on the interest of current

employees and retirees not to make a minimum 1.5% contribution -

- for any reason -- is itself minimal.5

      For   substantially       the     same   reasons,     we     reject    FMBA's

argument that Chapter 1, which changes the definition of "final

compensation" used to calculate retirement benefits, violates

the   equal     protection   guarantees        of    the    Federal    and     State

Constitutions because it results in arbitrary classifications

among employees.

      Chapter    1,   Section     22     (codified    in    relevant    part       at

N.J.S.A. 43:16A-1(28)(a)-(b)), provides that for employees who

become members of PFRS after May 21, 2010, "final compensation"

means the     average   annual        compensation    for    any    three    fiscal

5
  Plaintiffs have not clearly defined the specific interests they
claim are impacted by the 1.5% contribution. NJEA asserts that
Chapter   2   disproportionately   impacts   lower-income   State
employees by requiring they contribute the same percentage of
their salaries as other employees. We note that the provisions
of Chapter 2 concerning the 1.5% contribution have been
partially superseded by the provisions of Chapter 78 requiring
health care contributions based on employees' earning levels,
with a minimum, or floor, of 1.5% base salary. See L. 2011, c.
78, § 39 (codified at N.J.S.A. 52:14-17.28c); L. 2011, c. 78, §
40 (codified at N.J.S.A. 52:14-17.28d) (employees participating
in SHBP and SEHBP); L. 2011, c. 78, § 41 (codified at N.J.S.A.
18:16-17.1) (employees of boards of education); L. 2011, c. 78,
§ 42 (codified at N.J.S.A. 40A:10-21.1) (employees of a local
unit or agency thereof).    These provisions of Chapter 78 also
require different contributions for individual and family
coverage.   L. 2011, c. 78, § 39 (codified at N.J.S.A. 52:14-
17.28c).




                                         38                                 A-3274-10T3
years of membership. 6             For employees who became members before

that date, final compensation "means the compensation received

by   the     member in       the    last    12 months          of    creditable     service

preceding his retirement or death."                     N.J.S.A. 43:16A-1(28)(a).

        We    agree    with    Judge       Feinberg      that       the    classification

between      current    and    new       enrollees      is     rationally     related     to

legitimate State goals including cost savings, ensuring the

fiscal        stability        of        the         plan,      and        administrative

efficiency.      See Brown v. State, 356 N.J. Super. 71, 82 (App.

Div. 2002) (explaining that the Legislature may limit benefits

it   confers     in    the    interest         of    preserving       State's      economic

resources).      The law fully comports with the federal and state

equal protection guarantees.

                                               C.

      FMBA     and    Teamsters      next      argue     that       the   judge   erred   by

dismissing their claim that the 1.5% contribution requirement of

Chapter 2 violates the Contract Clauses of the Federal and State

Constitutions        because       the   laws       impaired    existing     and    pending

CNAs.


6
  Chapter 1, Section 20 (amending N.J.S.A. 18A:66-2) and Chapter
1,   Section  21   (amending  N.J.S.A.   43:15A-6),  change  the
definition of final compensation for new enrollees in TPAF and
PERS from the average compensation for the three years prior to
retirement, to the average of five years.




                                               39                                  A-3274-10T3
      The federal and state constitutions prohibit the passage of

any "law impairing the obligation of contracts."                                U.S. Const.

art. I, § 10, cl. 1; N.J. Const. art. IV, § 7, ¶ 3.                                "The two

clauses     are      applied        coextensively          and     provide       the     same

protection."        N.J. Educ. Ass'n v. State, 412 N.J. Super. 192,

205   (App.   Div.)        (internal       quotation       marks    omitted),       certif.

denied,    202     N.J.     347     (2010).          In    addressing       a    claim    for

violation     of    the     Contract         Clause,      the   threshold       inquiry       is

whether    the     law     "operated       as    a   substantial     impairment          of    a

contractual        relationship."             Allied      Structural    Steel       Co.       v.

Spannaus, 438 U.S. 234, 244, 98 S. Ct. 2716, 2722, 57 L. Ed. 2d

727, 736 (1978).            In making that determination courts inquire

whether:      1)     "there       is   a     contractual        relationship";      2)    the

"change in law impairs that contractual relationship"; and 3)

"the impairment is substantial."                     Gen. Motors Corp. v. Romein,

503 U.S. 181, 186, 112 S. Ct. 1105, 1109, 117 L. Ed. 2d 328, 337

(1992).     If the state law constitutes a substantial impairment,

it may nonetheless "be constitutional if it is reasonable and

necessary to serve an important public purpose."                        U.S. Trust Co.

v. New Jersey, 431 U.S. 1, 25, 97 S. Ct. 1505, 1519, 52 L. Ed.

2d 92, 112 (1977).

      We affirm, substantially for the reasons explained by Judge

Feinberg.     We     add     only      the      following       comments.         FMBA    and

Teamsters base their arguments primarily on the premise that



                                                40                                 A-3274-10T3
their CNAs do not expire on their expiration dates, but rather

continue,       either     under    a    theory    of   implied       contract     or   by

statute.        The statute FMBA relies on is N.J.S.A. 34:13A-21,

which states in part that "[d]uring the pendency of proceedings

before    the    [interest]        arbitrator,     existing       wages,     hours      and

other conditions of employment shall not be changed by action of

either party without the consent of the other[.]"                             Teamsters

rely     on     N.J.S.A.     34:13A-5.3,        which        states    in   part     that

"[p]roposed       new     rules     or    modifications         of     existing     rules

governing       working     conditions       shall      be    negotiated     with       the

majority      representative        before      they    are    established."         This

statutory rule, "known as the prescription against unilateral

change     of     the    status     quo,     prohibit[s]         an    employer      from

unilaterally       altering        the    status       quo    concerning      mandatory

bargaining topics, whether established by expired contract or by

past practice, without first bargaining to impasse."                              Bd. of

Educ. of Neptune v. Neptune Twp. Educ. Ass'n, 144 N.J. 16, 22

(1996)     (alteration       in     original)      (internal          quotation     marks

omitted).

       Chapter 2 does not require public employees to make the

1.5% contribution until after existing CNAs expire.                         Contrary to

plaintiffs' arguments, N.J.S.A. 34:13A-21 and N.J.S.A. 34:13A-

5.3 create statutory, not contractual, prohibitions against a

party changing the terms and conditions of employment during the



                                           41                                    A-3274-10T3
pendency    of   interest         arbitration      proceedings      or    during        the

negotiation of a new CNA.             As we have previously explained, the

statutes apply to the parties to the expired CNA, not to the

Legislature.     And       because      the        Legislature          created         the

prohibitions against such changes, the Legislature can modify

them by statute.        Further, even if the terms of an expired CNA

are deemed to be implied in fact until new terms are negotiated,

public     employees    have       neither     a    contractual         right     nor     a

reasonable expectation that terms implied in fact under such

circumstances     will       survive     superseding           terms      imposed        by

preemptory legislation.

                                              D.

      We reject plaintiffs' remaining contentions substantially

for the reasons that Judge Feinberg rejected them in her well-

reasoned    decision.        Those     contentions        include       the    following

arguments: the 1.5% contribution is an invalid tax on income

that did not originate in the General Assembly; the sections of

Chapter 2 imposing the 1.5% contribution are void for vagueness;

Chapters 1, 2, and 3 violate plaintiffs' rights to procedural

and   substantive      due    process,       and    constitute      a    taking;        and

Chapter 2 is a special law that decreases the emoluments of

public   employees     and    also    regulates         the   internal        affairs    of

municipalities,      all     in    violation       of   the   State     Constitution.




                                         42                                      A-3274-10T3
These and plaintiffs' other remaining arguments do not warrant

further discussion in a written opinion.                        R. 2:11-3(e)(1)(E).

                                           IV.

       The Legislative Defendants argue, as an alternative reason

for affirming the trial court’s judgment, that they are immune

from   suit      because       an    action     against         the    State   Senate      and

Assembly challenging the constitutionality of a law violates the

separation of powers and the Speech or Debate Clause of the New

Jersey Constitution; and that Judge Feinberg erred by ruling to

the contrary.

       The     doctrine    of       separation       of   powers       is   set   forth     in

Article III, Paragraph 1 of the New Jersey Constitution, which

provides that "[t]he powers of the government shall be divided

among three distinct branches, the legislative, executive, and

judicial.       No person or persons belonging to or constituting one

branch shall exercise any of the powers properly belonging to

either    of    the    others,       except     as    expressly        provided      in   this

Constitution."           The    Speech     or      Debate       Clause,     set   forth     in

Article      IV,      Section       IV,   Paragraph         9     of    the    New    Jersey

Constitution, provides that:

               Members of the Senate and General Assembly
               shall, in all cases except treason and high
               misdemeanor,   be  privileged   from  arrest
               during their attendance at the sitting of
               their respective houses, and in going to and
               returning from the same; and for any
               statement, speech or debate in either house



                                              43                                     A-3274-10T3
               or   at   any  meeting  of  a  legislative
               committee, they shall not be questioned in
               any other place.

    Preliminarily, we note that the record on appeal is not

clear as to whether Judge Feinberg dismissed the claims against

the President of the Senate and Speaker of the Assembly.                                 She

thought     she    had    dismissed       those     claims.         The     Legislative

Defendants      believe    that     the    judge    was    mistaken        and    did    not

dismiss those claims.             Regardless, it does not appear from the

record    on    appeal     that     any    plaintiff       seriously       opposed       the

Legislative       Defendants'       application       in     the    trial        court   to

dismiss   the     claims       against    the   President      of    the    Senate       and

Speaker of the Assembly.             Those claims should never have been

filed.    There was no basis, in law or in fact, for making them.

    Legislative          immunity    guaranteed      by     the    Speech    or     Debate

Clause assures that the speech and conduct of legislators acting

within the sphere of legitimate legislative activity will not be

made the basis for a civil judgment.                       Gilbert v. Gladden, 87

N.J. 275, 292-93 (1981).              Moreover, in a case where the sole

relief    sought     is    a    judicial    declaration       that     a    statute      is

unconstitutional, naming individual legislators is a meaningless

exercise.         They    are    unnecessary       parties    because       the     relief

sought can be obtained without them, and nothing can be obtained

from them.        Naming individual legislators in cases where such




                                           44                                     A-3274-10T3
limited    relief     is    sought     accomplishes           nothing        other      than

distraction, wasted time, and perhaps wasted money.

      Those and other reasons could arguably lead to the same

conclusion as to the Senate and the Assembly.                        Interpreting the

Speech or Debate Clause to apply to those institutions would

certainly serve several salient purposes.                           And as a general

proposition, a plaintiff can obtain a judgment declaring that a

statute    is     unconstitutional     by     naming     only        the   State       as   a

defendant.       See DePascale, supra, 211 N.J. at 47.                     We conclude,

however, that the prudent course is not to decide the issue in

this case.

      We   have    previously    noted      that     "courts        should    not      reach

constitutional questions unless necessary to the disposition of

the   litigation."         O'Keefe,    supra,      132       N.J.    at    240.        Here,

deciding    this    constitutional       issue     is    unnecessary.             We    have

already    upheld     Chapters    1,     2,    and      3.          Additionally,        the

Legislative Defendants have not filed a cross-appeal, but have

advanced their constitutional argument only as an alternative

reason     for    affirming     the    trial       court's          judgment.          This

alternative reason is unnecessary in view of our rejection of

plaintiffs' claims.           This action may be, as the Legislative

Defendants say, one in which plaintiffs seek only a declaratory

judgment that Chapters 1, 2, and 3 are unconstitutional, but

plaintiffs initially sought injunctive relief and Judge Feinberg



                                         45                                       A-3274-10T3
issued a comprehensive opinion as to that claim.                      The parties

have     not    briefed    whether    the        Legislative    Defendants      were

indispensable parties to the claim for injunctive relief.

       For     all   those      reasons,        we   decline    to   address    the

Legislative Defendants' alternative constitutional argument.

                                           V.

       We end where we began.          We recognize that Chapters 1, 2,

and 3 affect the disposable income of the State's active and

retired public employees.            But the Legislature enacted these

laws to ensure that the State's pension and health care systems

remain fiscally sound and that the State's taxpayers are not

unduly       burdened.    The   legislation          furthers   legitimate     State

interests and violates neither the New Jersey Constitution nor

the United States Constitution.

       Affirmed.




                                           46                             A-3274-10T3
