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Share this Twitter Myspace Digg Del.icio.us Reddit Slashdot Furl Yahoo Technorati Newsvine Facebook Export PDF Print E-mail Tags state year jersey budget spending taxes today government tax billion local school ‐‐ reform years system pay property time public Article Index The full text of Gov. Chris Christie's 2010 budget address Page # Page # All Pages

Closing a nearly $11 billion budget gap required us to look hard at the biggest category of spending in the budget - state aid to school districts. Last year's state aid included over $1 billion in one shot federal stimulus money that will not return this year. This type of irresponsible use of stimulus money was a typical election year gimmick used to fool school districts and our citizens. Today, we pay the price for putting off the hard choices; school districts will have $819 million less than they had last year. These federal dollars are gone because the stewards of last year's budget decided to spend every nickel in one year rather than spreading these resources over a number of years as the program intended.

We have worked to ensure that no school district in New Jersey will face a reduction in aid that is greater than 5% of their school budget ‐‐ so school districts will face a budget cut that is 4% less than the cut in state spending as a whole. During a crisis worsened by the election year foolishness of our predecessors, we keep school aid cuts at less than state spending cuts.

And I am also proposing legislation to finally give school districts the power they have
repeatedly asked for in collective bargaining and in setting employee benefits so that they can lower the costs of their budget without affecting learning in the classroom.
Now, let's speak candidly about the costs of our public school system. I am a product of New Jersey's public schools and proud of it. I honor the service of good, conscientious teachers who care deeply about training the leaders of tomorrow for our state.

The leaders of the union who represent these teachers, however, have used their political muscle to set up two classes of citizens in New Jersey: those who enjoy rich public benefits and those who pay for them. That has created a system that cannot be sustained - a system fueled by mandatory dues of more than $700 a year taken out of every one of the nearly 200,000 teachers' paychecks.

Political muscle fueled by intimidation tactics, political bullying and smears of public officials who dare to disagree. This conduct has set up an unfair system. Is it fair to have any public employees getting 4‐5% salary increases every year, even when inflation is zero %, paid for by citizens struggling to survive? It is fair to have New Jersey taxpayers foot the bill for 100% of the health insurance costs of teachers and their families from the day they are hired until the day they die? Is it fair that teachers have a better, richer health plan than even state workers and pay absolutely nothing for it?

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. The union bosses will tell you, as they always have each time their empire is threatened, that 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 members?

Does a child learn more if the union gets 5% taxpayer funded raises every year for its members? This is nonsensical and self‐serving - and we all know it.

Just how arrogant has the union gotten? By refusing to accept merit pay and use it to reward their best members, the union may have cost New Jersey $400 million in race to the top school aid from Washington. They did this in a year when they complain about budget cuts; in a year when we could truly use the money. Ask yourself, just who is putting their personal interests ahead of our children's?

My proposal is simple: school district employees should pay for a reasonable portion of their health care costs, just like every other New Jerseyan. If we do not end this dual system, state and local government will have to raise taxes endlessly to pay for it.

Teachers are not the problem, they get it.

Trenton special interests are the problem and we must stand up to them.

With respect to municipal aid, I am recommending a reduction in various forms of municipal aid of $445 million, but it has been designed to minimize the effect on any one municipality. I am also ordering the department of community affairs to implement a new, disciplined, and significantly reduced program for the past recipients of special municipal aid and extraordinary aid.

No longer will we reward cities and towns who irresponsibly spend. The gravy train of this type of aid is ending. Only those who show they are cutting their budgets just as we are, and practicing transparency with the aid, will make the grade for temporary help. The message is simple: we are ending this aid, and soon, so get your act together now.

In the task of getting control of our finances and turning New Jersey around, we cannot do it alone. If we do not see spending control at the county, municipal and school board level, we will be leaving the job undone.

Today's pain will have been suffered in vain. So, local governments and school districts must be our partners in this shared sacrifice. Their spending growth is out of control in large part for the same reasons that state spending has grown - employee costs, health care costs, retirement costs, and a failure to set priorities while establishing reasonable means of control.

So today I am introducing in this budget a series of proposals that constitute a toolkit to protect taxpayers from property tax increases. At the same time, my plan will give local governments and school districts the tools to cut costs so they too can reduce taxes for New Jerseyans.

At its heart is proposition 2 ½ ‐‐ a constitutional amendment to cap the growth of property taxes at no more than 2 ½% per year. In 1980, the voters in Massachusetts adopted a similar proposition, and the results were striking. While in 1977 Massachusetts had the 3rd highest property tax burden, by 2005 it had dropped to 33rd place.

Some will say this will affect the quality of children's education. This is absolutely wrong. Massachusetts has accomplished this astonishing drop in property taxes while maintaining the #1 k‐12 achievement in America.

We must take the same direction. I urge the legislature to approve this constitutional amendment and send it to the voters this November. The voters have waited too long for relief. There is no good reason to take this decision out of voters' hands. If it is right to vote for a constitutional amendment to fund pensions, as many in this chamber support, I contend we must allow voters to vote for controlling their own property taxes.

But the state should not ask cities and towns to meet a standard that we ourselves are not willing to live up to. Accordingly, I am also proposing that this constitutional amendment cap the growth of state spending at 2 ½ percent per year. We must also have collective bargaining reform that respects these new caps. Arbitration must be preserved for public employees who cannot strike. But arbitrators cannot act in a vacuum. We must reform the system to allow for recognition of the spending caps and an award's impact on property taxes. Fundamental fairness to both sides requires an arbitration system - but one that is fair to all parties.

We must also have civil service reform. The heart of our proposal is that local government at every level should have the option of opting out of civil service. That tool alone will save an untold amount of taxpayer dollars and make management of our towns better and more professional.

This taxpayer's toolkit for property tax reform is one piece of a broader reform agenda that must accompany the spending decisions we are making in this budget. Both "r" words - reduction and reform ‐‐ must be covered as we try to control spending for the long term and attack this budget deficit.

Shortly after taking office, I signed executive order 15, under which we are reviewing the hundreds of authorities, boards and commissions that populate New Jersey state government. Our goal: to consolidate or eliminate those that should not exist, and to end the excessive compensation and pension grabs made by those in this shadow government.

We are asking for shared sacrifices to put our house in order - out of control authorities and commissions like the Passaic Valley Sewerage Commission must learn that their days of padding their own pockets at the expense of taxpayers are over.

Part of that cleaning up should be to analyze which functions can best be performed by state employees and which by outsiders. For example, the state does not need to be in the business of running parking garages. And it does not need its own television network - New Jersey network can and will succeed as an independent not‐for‐profit, and we should free it to pursue that path.

Last week, I established a privatization advisory board, to be chaired by former congressman and state legislator Dick Zimmer, to examine other opportunities for saving by contracting with competent outside firms.

In the past, we've been insufficiently attentive to running state government smarter, cheaper, and more effectively. I am sending to you today dozens of initiatives to do just that - from using electronic benefit transfer cards instead of paper for child care payments, to cracking down on Medicaid fraud, to the simple step of using direct deposit for state employee salaries.

These are only some of the steps I am including in the proposals I am sending to you today. It is not only our spending plan for next year; it is a blueprint for reform.
Because the financial crisis in which we find ourselves, as difficult as it is to resolve today, gives us the chance to lay the foundation for a more solid future tomorrow.

We are not turning state government upside down just to solve the crisis this year. We're doing it to reduce the chance that there will be another crisis next year. We are not cutting spending and trying to reform our habits for the sake of being punitive to those who must change. We're doing it for the sake of giving hope of what real change will bring
‐‐ a healthier, more affordable government, and ultimately a better life for the people of New Jersey.

Winston Churchill once said that "the pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty."

By that standard, I am an optimist.

I see this day, and this time, as an opportunity for New Jersey.

Even as we gather, the newspapers have reported that many of our fellow states are resorting to the techniques and tricks that have gotten New Jersey into so much trouble in the past. In Illinois, they are raising income taxes and increasing borrowing to solve this problem. Sound familiar? Like New Jersey, they will see taxpayers leave, and revenues fall. We have been there already and feel the sting of that failed policy today.

In Maryland, they are borrowing to cover current obligations. And in doing so, they are piling one problem on top of another, reducing the creditworthiness of their state, and creating a crisis that will be larger in the future. Hey, we've done that already, too. Today we live with the choking debt service that this failed policy has wrought.

By taking direct, tough action, difficult as it may be, we can turn our crisis into an opportunity. In a competitive national and global economy, we can build a lead on those states. 37 of the 49 other states are electing governors this year. You know nothing tough is going to happen this year in those states.

But if we make the tough decisions now, we will be one year ahead of 80% of the states in the race to economic growth. If we fail to act, we will fall even further behind.
Surely the day of reckoning will come for these other states in the coming years. Their need to reform and restructure, like ours, is inevitable. And by going first, we can become first.

You see, my goal is for New Jersey to be the leader.

Today, we are first in tax burden. We are first in the number of college students who, once educated, leave our state. We are near the top in debt, and number one in getting the least back from Washington for every dollar we pay in taxes.

All this must change.

I said eight weeks ago that change has arrived. And today is a key day in implementing and pursuing that change. The reforms we make today ‐‐ to streamline the operations of government; to halt the endless parade of new taxes; to lay the groundwork for growth - can make possible a new kind of leadership.

Where New Jersey is number one in new business creation.

Where New Jersey is number one in job growth.

Where New Jersey is number one in educational achievement.

And where we lead once again in providing opportunity for our citizens and pride in what we can accomplish together. There is no question: this has been an incredibly difficult period for our state and its people.

And the choices I am asking you to make now will not be easy. But they are the first step on the path to a brighter future.

It has been said that "the important thing is this: to be able at any moment to sacrifice what we are for what we could become." So while the task ahead of us may not be pleasant, it is essential. We can accomplish something important here in New Jersey.

Something big. It is nothing less than the turnaround of our state, and the creation of a brighter future for our children.

So I ask those of you in the legislature, and all of the citizens of our state, to join me ‐‐ in pitching in, in working together ‐‐ not only to share in the sacrifices we must make today, but in forging the path to a better tomorrow.

The journey starts today, and I know it will be worth the effort.

May God bless you, may God bless America, and may God continue to bless the great state of New Jersey.