Governor ready to introduce $29.2 billion 2010-11 budget

BY TOM HESTER SR.

NEWJERSEYNEWSROOM.COM

UPDATED

Gov. Chris Christie Tuesday will introduce a proposed $29.2 billion 2010-11 state budget that suspends property tax rebates, avoids a $3 billion contribution to the state pension system, and eliminates over $1 billion in state aid to schools, cities and towns, according to information provided by legislators and their aides.

The budget is about $2.9 billion less than Gov. Jon Corzine's last budget of 2009-10, about a 9 percent decrease. Under Christie's budget, school districts would lose $819 million in aid and cities and towns will lose $445 million. The state's public colleges would lose $170 million in aid and the private colleges would lose all state support.

Christie will also propose saving $50 million in state funds by privatizing unspecified government services.

The budget must be approved by July 1 and Democrats who control the Legislature are vowing to scrutinize it. At least some of them see some of the proposals as a move to dump the state government's fiscal crisis, at least for the 2010-11 budget year, on local government and property taxpayers.

Christie will propose a constitutional amendment limiting annual property tax increases to 2.5 percent, an action designed to force every level of government in the state and school districts to re-examine its spending practices and how public employee raises and benefits are handed out. If the proposal reaches the November ballot and is approved by voters, it would not take affect until July 1, 2011 at the earliest. Spending above the cap would require local voter approval.

As part of the plan to suspend rebate checks, Christie will propose converting the money property owners and some renters would have received into direct credits on their tax bills. Some seniors may still receive rebates.

The annual mailing of rebate checks has been a politically sacred event by both Republican and Democratic administration since the late 1970's.

Christie is preparing to skip the $3 billion pension contribution at a time when the pension system is underfunded by $46 billion and at risk of becoming insolvent. In an effort to solve his 2009-10 budget problems last year, Corzine skipped a $2.5 billion pension payment and allowed cities and towns to pay only 50 percent of their obligation.

Barbara Keshishian, president of the 200,000-member New Jersey Education Association, the statewide teachers' union, described the proposed budget as "a disaster that would dismantle the best public school system in America.

"This budget is a disaster for public school children and for older students who want to further their education beyond high school,'' Keshishian said. "On the other hand, this budget is an unconscionable gift to those earning more than $400,000 a year. Governor Christie is slashing education in order to pay for tax breaks for the wealthy.''

Christie is planning to rollback an income tax hike levied last year on New Jerseyans who earn more than $400,000 annually.

"At a time when the state is facing record unemployment, he wants to lay off thousands of teachers, school employees, and college faculty and staff -- adding to the problem,'' Keshishian said. "And at a time when education and retraining are the only hope for countless displaced workers, Governor Christie is slamming the door of opportunity in their faces by cutting aid to our county colleges.''