In the Press: On state budget, a Republican Response

June 4, 2008

Contact: Brad Schnure / 609-292-5199
A More Affordable NJ

Published in The Record on June 4, 2008

By James Ahearn

Republican members of the state Senate and Assembly last week issued a package of alternatives to Governor Corzine’s proposed budget. They include spending cuts to finance continuation of popular programs he wanted to end.

Some of the Republican proposals are unrealistic. They aren’t practical or won’t accomplish as much as the legislators estimate. Sore are politically untenable, considering that Democrats are the majority party in both chambers. However, some seem sensible and doable.

Nevertheless, the governor reacted with anger and contempt. In a formal statement issued by the Treasury Department, he declared, “Republicans are following in the footsteps of their predecessors by talking about spending money and restoring cuts without offering any legitimate way to pay for them. This is all make-believe math.

“It is the same sort of gimmickry and trickery that has put the state in the fiscal mess we now find ourselves trying to deal with.”

In the annual game of balance-the-budget, the State House is getting close to the end. The New Jersey Constitution requires that the income and spending plan for the next fiscal year be adopted by the end of this month. Now is not the time to needlessly antagonize 49 of the 120 members of the Legislature.

The Assembly speaker, Joseph Roberts, who has not hesitated to sponsor and win enactment of legislation opposed by the minority, responded more temperately than the governor.

“Every item on the Republicans’ list deserves to be fully vetted for feasibility and potential impact on the state’s long-term bottom line,” Roberts said. “Democrats and Republicans alike are committed to delivering a final budget that makes government at all levels more accountable and will make the state more affordable. No idea that potentially could help New Jersey’s taxpayers will be rejected out-of-hand.” Hear, hear.

Rebate check Gimmicks

Specifically, he agrees with the Republicans that property-tax rebate checks are gimmicky, that significant money could be saved by giving homeowners equivalent property-tax credits on their state income-tax returns.

As for Richard Codey, the Senate president, he offered one of his throwaway gags: “Telling the Turnpike Authority they have to fund a multibillion-dollar widening project by tightening their belts is like telling Steve Wynn to fund his casino by collecting loose change along the Atlantic City Boardwalk.”

The Republican plan calls for dedicating half a billion dollars of motor-vehicle fee income to transportation projects, but that money is now used for general state purposes. It would have to be replaced, or the budget would be $500 million in the red. The plan claims $1.3 billion could be saved through nearly 70 money-saving proposals.

Some of these are technically feasible but politically difficult, like sharp cuts in so-called “special municipal aid,” a program originally intended to help municipalities facing unforeseeable emergencies.

It has grown into a permanent slush fund for a handful of favored cities. Six years ago, this aid cost less than $40 million. Today it costs $153 million, and a report by the non-partisan state auditor says it operates without objective criteria for determining need. The Republicans say that the state should help communities in genuine distress, but that the amount spent in 2002 should suffice.

The party’s plan also calls for cuts in aid increases to 23 of the 31 poor, and poorly performing, Abbot school districts. Aid to the 23 has risen by 30 percent since 2002, and the courts have rebuffed arguments that this is inadequate, so further aid increases need not be as large as the governor’s budget proposes. Saving of $105 million should be possible.

Money-saving changes

The plan also calls for money-saving changes to health and pension benefits for state employees. For new hires, the retirement age should be raised from 60 to 62. That would reduce the pension system’s unfunded liability and put the system more in line with the private sector. Also, the change would recognize increased life expectancy.

Pensions are now based on the three highest years of pay. This results in supervisors boosting salaries for favored workers close to retirement. The Republican plan calls for basing pensions on the five highest-paid years.

There are some good ideas here. As the deadline draws near for passage of a budget, the governor and legislative leaders, all Democrats, should not turn deaf ears to Republicans saying things they do not want to hear.