Lora, Seidman and Milmed.
We affirm substantially for the reasons expressed in the comprehensive opinion of Judge Lenox reported at 144 N.J. Super. 152 (Ch. Div. 1976).
Additionally, we question whether the Legislature, in the guise of taxation, may take from an employer made subject thereto by the statute an amount equal to "the total amount of nonvested pension benefits of such employees of the employer who have completed 15 years of covered service * * * and whose nonvested pension benefits have been or will be forfeited because of such termination of employment * * *," and then cause the moneys to be distributed to each eligible employee making claim thereto, in the amount of the current value of the benefits to which each would be entitled.
While The Private Nonvested Pension Benefits Protection Tax Act, L. 1973, c. 124 (the "act") does not by its terms specifically establish a "dedicated fund" in the sense that the monies collected under the act are required to be held separate and apart from the general revenues of the State and dedicated to a specific purpose, it is obvious that the Legislature intended the monies collected from an employer to be used to pay the "nonvested pension benefits" to his employees. This intention is evidenced by § 8 of the act
which provides that each such employee shall be entitled to make a claim for an immediate payment of the current value of his nonvested pension benefits or a deferred pension benefit and to receive such payment or benefit in accordance with the rules and regulations promulgated by the Commissioner of Labor and Industry.
Under the act the tax is "equal to the total amount of nonvested pension benefits" which employees will lose upon the closing of their employer's place of business (§ 3).
The Statement accompanying the Senate Committee's version of the bill says:
The revenues collected from the tax would be paid to employees to the extent of their nonvested pension rights in accordance with rules and regulations promulgated by the Commissioner of Labor and Industry.
In view of the foregoing, it appears there is merit to respondent's assertion that the intent of the act is to require the employer to provide for each employee exactly what he would have received if he had qualified for a pension under the terms of the employer's pension plan, and that the role of the State is simply that of a fiscal intermediary.
Respondent's argument that the act which expired on July 1, 1975 is not a tax in that it does not raise money for general revenue purposes or a public purpose, its sole purpose being to provide specific employees with funds equivalent to their nonvested pension benefits, with the Director of Taxation serving merely as a conduit of monies secured from the respondent employer for the individual benefit of its employees, is persuasive. 71 Am. Jur. 2d Taxation , § 3, p. 345, § 44, at 373-374, § 48, at 375. United States v. Butler , 297 U.S. 1, 61, 56 S. Ct. 312, 317, 80 L. Ed. 477, 485 (1936); Tide-Water Co. v. Coster , 18 N.J. Eq. 518, 523 (E. & A. 1866); Roe v. Kervick , 42 N.J. 191, 207 (1964).
Carmichael v. Southern Coal & Coke Co. , 301 U.S. 495, 57 S. Ct. 868, 81 L. Ed. 1245 (1937), in which the validity of a tax assessed against employers to subsidize an unemployment compensation fund was upheld, and cited by the intervenors in support of their position that the act is a tax with a ...