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Governor proposes $29.3 billion 2010-11 budget

BY TOM HESTER SR.

NEWJERSEYNEWSROOM.COM

SECOND UPDATE

Gov. Chris Christie Tuesday told legislators that his proposed $29.3 billion 2010-11 is a dose of distasteful medicine designed to fulfill his pledge of creating smaller government and having the state live within its means.

The governor said his proposed budget, which includes $1.2 billion in state aid reductions to local governments and school districts will mean an average property tax hike of no more than $250 per property owner, an increase that can be expected to trickle down to renters.

In a 48-minute address to a joint session of the Legislature in Trenton, Christie declared, "Today, we begin doing what we promised we would do. The defenders of the status quo have already begun to yell and scream. They will try to demonize me. They will seek to divide us rather than unite us. But even they know in their hearts, if not yet in their minds — it is time for a change.

Christie made his remarks before a standing-room-only crowd of state officials, past governors, lobbyists, and reporters. He entered the Assembly chamber to over two minutes of applause, mainly maintained, in part, by Republican legislators and his cabinet.

"Never forget, some of those shouting the loudest are the architects of the disaster we are now suffering,'' Christie said. "Do we really want another decade of economic failure? No, this spring it is time to clear away the underbrush to make room for growth.

"So, today, we stop sweeping problems under the rug. We will not hide our problems until another day. And we are certainly not increasing the tax burden we place upon our people.''

As he confronts the state government's worst fiscal crisis since the Great Depression of the 1930's, Christie plans to cut $820 million in state aid to schools and $445 million in aid to cities and towns. He also plans to cut $175 million in aid to state and county public colleges and all aid to private colleges. He said he expects 1,300 state employees will be laid-off beginning Jan. 1 as he moves to eliminate or privatize government programs.

Christie said he will suspend property tax rebates this year and when they resume in May 2011 as direct tax relief in the form of lower property tax bills. He said state charity care aid to hospitals will continue as will the state medical coverage program for poor children. He said state-supported prescription coverage for low-income seniors will continue and that eligibility for food stamps will be expanded to 185 percent of the poverty level. He also said he will fund the upkeep of state parks.

The governor said he wants to sell NJN-TV, the state-run public television station.

Christie maintained that despite the cuts in aid to schools, municipalities and colleges, the budget will not increase taxes on New Jerseyans.

He said the budget will reduce state spending by 9 percent and that the budget of every state department will undergo reductions ranging from 35 percent to 2 percent. The Department of Community Affairs, which in the past has provided millions of dollars in special state aid to cities and towns, an action Christie questions, will undergo the 35 percent reduction. The governor said he is ending the awarding of the special aid, an action he believes fill force local governments to cut spending.

"Today, we are taking necessary and decisive action to reduce state spending and reform state government,'' Christie said. "The problems we have hidden for twenty years are evident for all to see. The day of reckoning has arrived.''

The budget calls for the state to skip a $3 billion contribution to the pension and benefits systems that benefit state and local public employees and teachers. He said he will sign legislation moving through the Assembly and senate designed to reform the system when it reaches his desk. He said he wants civil service reform that would include allowing local governments to drop out of the civil service system.

As part of his effort to cut state spending and reduce school aid, Christie declared war on the politically-powerful 200,000-member New Jersey Education Association, the statewide teachers' union. He said he wants teachers to begin contributing to the full health coverage they and their families receive from the day they are hired until they die.

Christie charged that the NJEA cost the state $400 million in federal school aid last year.

"I believe rank and file teachers know this is not fair and that we can no longer afford to burden our taxpayers with these costs and runaway taxes,‘' he said. "The union bosses will tell you, as they always have each time their empire is threatened, that they are protecting the children. This tired song has grown each time their empire is threatened, they are protecting our children. This tired song has grown old and inaccurate. Is the way our children learn affected by whether the union gets free family health insurance for life for its member? Does a child learn more if the union gets 5 percent taxpayer funded raises every year for its members? This is nonsensical and self-serving — and we know it.''

Christie said the state‘s fiscal problems have been developing for two decades. "It has been dug by a lack of discipline and unwillingness to say no; made deeper by poor policy choices along the way and quick fixes to avoid tough decisions.''

As he and his cabinet shaped the budget, they confronted a multi-billion deficit.

"And now that hole is a grand canyon. The distance between New Jersey's projected revenues for next year and the state's spending obligations under current law, if nothing is changed, is $10.7 billion. As a percentage of the prior fiscal year's $29 billion budget, it is a massive deficit — the largest deficit of any state in America, and the largest in our own history — by far. No fiscal crisis we have had in New Jersey's history compares to this one.''

Christie said his budget proposes a top to bottom review of state government in an effort to bring its spending under control.

"My budget proposes that we reform the way New Jersey government operates; and that we demand reform from the local governments we fund as well. My budget proposes that we end the days when New Jersey is a national leader in per person taxes, per person debt, and unemployment — and that we instead turn New Jersey into a national leader in job creation, growth, and opportunity.''

The governor concluded, "This plan requires sacrifice by all New Jerseyans. But it is a shared sacrifice. And while holding the line is difficult today, it is necessary for a better tomorrow.

"The watchwords of this budget are shared sacrifice and fairness. Individuals contribute, businesses sacrifice, local governments tighten their belts, and we end our addiction to spending. Everyone comes to the center of the room — we jump off the cliff together to stave off certain fiscal death for the hope of economic salvation tomorrow."