Category Archives: Gov. Jon Corzine

NJPP Monday Minute 7/5/10: Family Leave Insurance gets high marks on first anniversary


The dynamics of work and family have changed drastically in the past 50 years. In today’s shaky economic climate, it’s not unusual for working parents to juggle one or more jobs to make ends meet, leaving less time for family caregiving responsibilities.

New Jersey has worked to strengthen state policies for working families and became a leader among states by implementing Family Leave Insurance last year. Signed into law by former Gov. Jon Corzine, Family Leave Insurance gives workers up to six weeks of paid benefits to care for sick family members or to bond with newborn and newly-adopted children. New Jersey is only the second state (after California) to offer this type of paid leave.

By all accounts FLI is a hugely successful program. While some business groups initially opposed the idea as an unfair burden, especially on smaller businesses, most employers now recognize that it has not been the nightmare forecast by some.

Here are the most recent statistics from the NJ Department of Labor:

  • Between July 1, 2009 and July 1, 2010, approximately 26,000 people benefited from the program.
  • 86% of the beneficiaries were women between the ages of 25 and 44.
  • 80% of claims were to allow parents to bond with newborn or newly adopted children.
  • 77% of beneficiaries were employed in the private sector.
  • The average duration of leave was 4.6 weeks, less than the 5.5 weeks expected when the law was enacted.
  • 85% of those who applied were approved for leave. Denials were predominantly due to an insufficient relationship between the worker and family member needing care (parent, spouse – yes; great aunt, step-uncle – no).

Family Leave Insurance benefits in New Jersey are funded entirely by employee payroll deductions based on a formula adjusted annually according to the taxable wage base. For this year, the payroll deduction was .012% of wages earned. The maximum amount anyone was required to contribute was $35.64.

To be eligible for Family Leave Insurance benefits, a worker has to be employed by a New Jersey covered employer and earn at least $145 per week during 20 calendar weeks in the base year. The base year covers 52 weeks immediately preceding the week in which Family Leave Insurance coverage would begin. Only New Jersey covered wages can be used to establish a valid claim. The weekly benefit rate is 2/3 of average weekly wages, with a maximum of $561. Employers with fewer than 50 workers are not required to hold open the employee’s job.

Fewer people than originally expected have taken advantage of the program.

New Jersey collected $131.4 million in taxes for FLI between April 2009 and May 2010, and paid out $59.9 million in benefits during that same time.

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NJPP Monday Minute: 2/16/10 JUST HOW BIG IS THAT DEFICIT?


This is the first in the Monday Minute series on the New Jersey state budget. Last week, Governor Christie declared a state of emergency to deal with the state’s “unprecedented financial crisis”. Was that action necessary or simply posturing?

All states (except Vermont) are constitutionally required to balance their budgets. All but four states start their fiscal years on July 1. When we talk about FY 2010 in New Jersey, we are talking about the year that started on July 1, 2009 and will end on June 30, 2010.

To be in balance, the budget must have enough revenue by June 30 to fund the programs included in the budget. If revenues are lower than spending, the resulting deficit must be corrected by year end-either through infusions of revenue, using reserve funds or program cuts.

In January last year, the state was facing a $2 billion operating deficit in its FY 2009 budget. By May it had ballooned to $4.4 billion largely due to an unprecedented 12 percent decline in overall revenues. To close this deficit, federal Medicaid funds were used to offset state funds; budget surpluses were spent down; a tax amnesty program was enacted; and $2.5 billion in program cuts were made.

As that budget year was ending, the administration and legislature were struggling to craft the FY 2010 budget which had an $8 billion structural deficit. The structural deficit is not the same as the operating deficit. Unlike the operating deficit which deals with only the current fiscal year, the structural deficit takes into account all of the state’s financial obligations-like pension payments and the statutory cost of funding a program-and requires the state to account for them. A budget that fails to make pension payments or overrides statutory formulas can be balanced if they rightly or wrongly are not included as full financial obligations in that year.

The FY 2010 structural deficit was resolved by a combination of taxes, federal money and spending cuts. The most significant source of revenue ($1 billion) was from a one year income tax rate increase on taxpayers with $400,000 or more in taxable income. Federal Medicaid and Fiscal Stabilization funding provided $2.3 billion for certain state services. The base budget was cut by $3.3 billion, including the decision to save $1 billion by not making the pension payment, cutbacks in property tax rebates to homeowners and renters, debt restructuring, unpaid furloughs and various other cuts to programs. In addition, nearly $1.2 billion in savings were found by freezing program growth.

These measures allowed Governor Corzine on June 29, 2009 to sign a balanced budget into law that was expected to raise $29.371 billion in revenues and spend $28.99 billion, leaving an end of the year surplus of $381 million.

Not surprisingly everything wasn’t perfect. It is extremely difficult to project revenues and expenditures into the future-made more so by the uncertainties of the national weak economy.

In bad budget years, outgoing and incoming governors point fingers to pass the blame. The Corzine administration claims to have left a budget surplus of $425 million on January 14; the Christie administration claims it was left a $1.3 billion deficit.

To make matters more dramatic, Governor Christie signed an executive order declaring a state of emergency on February 11. It was required, he said, because the state budget would be out of balance on June 30 by $2.2 billion. By his administration’s estimates, the state will collect $1.3 billion less revenue by the end of June and will need to spend an additional $872 million to meet its obligations.

So who is right in this posturing?

Their first disagreement is over the size of the revenue shortfall. Corzine officials claim it is $425 million but say those are actual amounts for the first six months of the fiscal year only. They don’t project what the deficit might be through June 30th.

The Christie administration claims a $1.3 billion deficit through June 30th. They seem to accept the Corzine estimate of $425 million for the first six months but believe revenue will fall off between January and June of this year, making the end of year deficit substantially larger. Whether this will happen is anyone’s guess.

Substantial unknowns exist. These revenue data don’t include a full accounting of sales tax collections from the holiday shopping season. No one can accurately predict what will happen in April when taxpayers settle up their income tax accounts with the state. Some believe the economy is starting to improve which may have a positive impact on tax collections through June 30th. All of these could produce a more positive revenue outlook.

Another disagreement is over the state’s spending needs between now and June 30th. In December, an additional $596 million was needed; those needs have grown to $870 million. Included are higher than anticipated costs for programs such as Medicaid, snow removal and food pantries. Many of these unanticipated costs are driven by the bad economy.

The third disagreement is about the impact of the Corzine administration’s actions prior to the change in administration. On December 22, Governor Corzine announced a plan to close a projected $924 million budget gap in the FY 2010 budget which included $839 million in spending cuts. Included in that $839 million was a $260 million reduction in aid to school districts and the requirement that school districts use their excess surplus balances. A comparison of Governor Corzine’s December 22 spending cuts with those announced by Governor Christie on February 11 suggests some overlap-particularly with respect to what is referred to as school district surpluses.

Whether we have a surplus or a deficit, the tax and spending decisions being made right now are likely to have a long term effect on the quality of life in this state. Change may be needed but let’s make it responsibly with the best information available.

Due to the President’s Day Holiday the Monday Minute is being distributed today.

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NJPP Monday Minute: 1/4/10

Every year, New Jersey gives away billions of dollars through tax credits, deductions, exemptions and cooperative agreements that – once enacted – seldom get reviewed. No one knows how much money the state forgoes because few people have been interested – until now.

Despite not being found in any appropriation line in the state budget, these “spending initiatives” represent spending. Unlike the spending that takes place in the budget, which must be reauthorized each year, these credits, deductions and exemptions – collectively known as tax expenditures – are part of the tax code. Because this form of spending is largely invisible, it gets little scrutiny.

Every program that receives no scrutiny has the potential to crowd out more important programs. That is because every dollar the state doesn’t collect is a dollar that must be raised by increasing an existing tax rate, taxing something else or providing fewer services.

Like traditional spending, tax expenditures are policy decisions that reflect government’s priorities. They cost state treasuries money in much the same way as direct spending for schools, health care or road construction. The only real difference is that instead of collecting and paying out money, this money isn’t collected at all. One might think this is more efficient than collecting and redistributing revenues. That is the case only if the benefits of these programs are reviewed annually along with programs requiring a direct appropriation.

Some tax expenditures are good and reflect taxpayers’ beliefs. In New Jersey, for instance, we do not collect sales tax on food, clothes or prescription medicine. These policy decisions cost the state hundreds of millions of dollars a year in revenue, however most New Jersey residents would agree with those choices. There would be less agreement about the decision to grant special interest tax credits to a specific business, especially if that business costs the state a lot and there was no proof of its overall benefit to every resident, not just to the few recipients of those credits.

Another costly example of a tax expenditure is the long-standing agreement between New York and New Jersey that taxes residents’ income based on where they work instead of where they live. New York State actually tracks and publishes this information. Based on their reporting, in 2004, that agreement cost New Jersey about $1.5 billion a year, a number that is likely higher now. Under this agreement, most people who live in New Jersey but work in New York pay more to New York than they would to New Jersey. New Jersey has a different agreement with Pennsylvania. As a result of that agreement, New Jersey and Pennsylvania incomes are taxed where a person lives, not where he or she works. Whether that is a benefit or a cost to New Jersey is unknown because we don’t collect and analyze the information.

Although most states track this information and make it public, New Jersey does not. This would change if a bill introduced by Sen. Barbara Buono, chairwoman of the Senate Budget and Appropriations Committee, becomes law. Sen. Buono’s bill would require the governor’s annual budget message to include a tax expenditure report, which would list each tax expenditure and its cost to the state.

In all likelihood, the totals would be significant. Washington State, for example, has reported that its 567 state and local tax expenditures cost nearly $99 billion a year in lost revenue; Oregon reports that its 362 expenditures cost nearly $29 billion; and Illinois’ 214 cost nearly $7 billion.

The idea of reporting this information is nothing new, even in New Jersey. In January 2006, Gov. Corzine’s transition team recommended that the state produce a tax expenditure report. Later that year, the state Division of Taxation developed a basic framework for a report, identifying 121 sales and use tax exemptions and exemptions, 44 gross income tax exclusions and 28 corporate business tax exclusions. Then, in November 2007, Gov. Corzine signed a bill into law requiring the state treasurer to produce an annual report with information on development subsidies. This report has yet to be produced.

Understanding how much the state spends through its tax code is even more critical now, as declining revenues will force New Jersey lawmakers to make more difficult decisions about how to spend taxpayer dollars. A tax expenditure budget is not a panacea. It will not automatically provide all the money the state needs to resolve its precarious fiscal situation. But, it will lead to more information, which can only lead to better choices, more appropriate spending and more accountability.

It is time for New Jersey to join the 41 other states, the District of Columbia and the federal government in recognizing that informed choices, whether they are direct appropriations in the annual budget or revenues foregone through the tax code, are ultimately better choices.

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N.J. Democrats Demand Marriage Vote

Advocate.com

In the wake of reports indicating that New Jersey lawmakers may be reluctant to bring a marriage equality bill to the floor during the lame duck session, some 200 Democrats sent a letter on Tuesday urging senate and assembly leaders to take a vote on the bill.

The prominent Democrats want action on the measure before the session ends and governor-elect Chris Christie, a Republican who has vowed to veto the marriage equality bill, takes office on January 19.

According to the Associated Press, “the Democrats, including members of congress, fundraisers and lobbyists , released a letter to leaders in the senate and assembly Tuesday demanding the bill be voted up or down before the lame-duck session ends in January.”

On Monday, a report in the Star-Ledger suggested that prospects for the marriage equality bill looked extremely bleak. Lead sponsor Senator Loretta Weinberg was quoted as saying, “I can’t say I’m confident now.”


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Corzine Accomplishments Tempered By Tough Times

Here is a very nice article that appeared over the weekend on the Philadelphia Inquirer website that I thought i would pass along. It talks about Governor Corzine’s accomplishments while in office and what kind of legacy he can point to in the future:

As Gov. Corzine heads into what are likely to be the final weeks of his political life, following the failure of his reelection bid on Tuesday, it’s unclear whether the bearded Midwestern native with the down-to-earth demeanor and the sweater vests will be remembered more for his legislative accomplishments or for the car wreck that nearly took his life in 2007.

Will people recall that the former Wall Street maven spent over $120 million of his own money on his campaigns and poured millions more into party coffers? Or will his legacy be the work he did for New Jersey’s schoolchildren?

“I think a good part of his legacy will have something to do with his car accident,” said Mary Forsberg, interim president of New Jersey Policy Perspective, a left-leaning think tank. “It’s really a sad thing. From our point of view, he did a lot of good, progressive things.”

Corzine’s accomplishments – or lack thereof – must be viewed in the context of a brutal nationwide recession, say many observers.

“Legacy changes as time goes on,” said Senate President Dick Codey, who preceded Corzine as interim governor after Gov. Jim McGreevey resigned. In the end, he said, Corzine “will be known as a man who tried to do the right thing for the state of New Jersey and got caught up in a very, very horrible recession.”

Among the campaign pledges Corzine was forced to abandon was a promise to increase property tax rebates by 40 percent over four years.

Ross Baker, a political scientist at Rutgers University, characterized Corzine’s governorship as one of “unfulfilled promise.” Corzine waded into the muck of New Jersey politics and was unable to make much headway, Baker said.

“Democratic governors as a group tend to be trapped in the feudal politics of New Jersey,” he said. They depend so heavily on county and regional political bosses, legislative bosses, and public-employee unions that they have trouble standing up to them, Baker said.

In his efforts to trim state spending, Corzine won significant concessions from public-employee unions. He forced workers to contribute to their health insurance for the first time, increased the retirement age from 55 to 62, and cut 8,200 jobs from the government payroll through attrition.

But to a skeptical public, those accomplishments were overshadowed by Republicans’ questions concerning his romantic relationship with Carla Katz, then head of one of the state’s largest public-employee unions.

Corzine’s relationship with the Legislature, controlled by fellow Democrats throughout his tenure, has sometimes been torturous.

In his first year in office, he faced off against Assembly Democrats over raising the sales tax. The battle resulted in a historic shutdown of state government. Corzine spent many nights on a cot he ordered wheeled into the Statehouse in a grand gesture intended to push lawmakers toward a resolution. Though he was successful in getting the tax increased to 7 percent from 6 percent, the 2006 incident foreshadowed many more periods of tension with the legislative branch.

On issues where Corzine was able to find allies in the Legislature, he was able to effect significant change, particularly on social issues. In 2007, New Jersey became the first state to abolish the death penalty since the Supreme Court reinstated capital punishment in 1976.

Last year, the Garden State became the third state to adopt paid family leave, which grants workers up to six weeks to care for sick family members, newborns, or newly adopted children.

In 2006, Corzine signed the civil-unions law, which extends to gay couples most of the rights of married couples. He also helped expand medical coverage for children in New Jersey, resulting in 100,000 more children being enrolled in the state’s health insurance program, according to the administration. Implementing court-ordered preschool programs in poor school districts was another achievement.

According to Assembly Speaker Joseph J. Roberts Jr., those accomplishments reflect Corzine’s priorities.

“He has been front and center in fighting for people who needed someone there for them, and I don’t think he got the credit for it,” the Camden County Democrat said.

Battered by a withering economy and the nation’s highest property taxes, New Jersey voters on Tuesday said they believed Republican Christopher J. Christie would do a better job of reining in spending and helping the state recover.

“Gov. Corzine’s legacy will be that his ambitions exceeded the state’s ability to support them,” said State Republican Chairman Jay Webber. “He wanted to spend more and raise taxes to spend more, and on Tuesday people said that they want to go in a different direction.”

But Ingrid Reed, New Jersey project director at Rutgers’ Eagleton Institute of Politics, said Corzine deserved credit for cutting the state budget.

“He really did reduce the state budget, which really has not happened before in New Jersey,” she said. He “has set a kind of standard for being responsible about the state budget.”

Corzine often pointed out that during his administration, he put more money into the state pension system than the previous three governors combined.

His efforts to change the school funding formula also will impact state spending for decades. Under the new formula, state aid is directed to any district with poor students rather than just the poorest districts.

Corzine took no time to tout the revised funding formula, instead diving into his 2008 proposal to pay down state debt and fund transportation by raising tolls up to 800 percent over more than a decade. The governor famously abandoned the plan midway through a scheduled 21-county road show to sell it directly to residents.

Likewise, the governor’s progress in ethics reform – which admittedly fell short of his ambitious goals – often was overshadowed by high-profile arrests of politicians by Christie, the U.S. attorney.

Corzine all but did away with the Trenton tradition of “Christmas trees,” earmarks inserted into the state budget at the last minute without public scrutiny. And he shamed the Legislature into accepting a ban on dual office-holding, though the measure grandfathered in a number of politicians who earn multiple paychecks.

But those accomplishments meant little to the public when Democratic State Sens. Sharpe James and Wayne Bryant were convicted, or when 44 people were arrested in July and accused of international money laundering and political corruption.

Joseph Marbach, a political analyst at Seton Hall University, believes it is unfortunate that people may focus on Corzine’s missteps rather than his accomplishments.

“Politics doesn’t necessary come naturally to him,” Marbach said. “That hindered some of the possible accomplishments he might have been able to achieve.”

Former Democratic Gov. Brendan T. Byrne said he called Corzine several times to urge him to trumpet some of his achievements, but Corzine declined.

“It wasn’t his nature,” Byrne said. “I don’t think he’s the kind of politician who’s built for this business.”

In the final assessment, Byrne said, history will be kinder to Corzine than voters were this week.

“He had no money to do anything, but he had good instincts, and I think that he’ll be remembered for that,” Byrne said.


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Filed under Gov. Jon Corzine, The Philadelphia Inquirer

The Governor Thanks His Supporters

I received the following email last night from the Governor Corzine. It was sent to all of those that supported him and his campaign this year. I thought that I would share it with you all:

You’ve stood by this campaign through thick and thin, and I wanted to take a few moments to thank you for all your support and encouragement throughout this campaign.

We may not have prevailed in the vote count, but we stood up for our common commitment to making this state the kind of place where all of our kids and grandkids can grow and prosper.

For that, I am truly grateful to each and every one of you.

Whatever our political differences, I believe that Chris Christie is going to work hard for the people of this state, and I wish the Governor-Elect success, patience, and good fortune as he leads our state forward.

I got into public life because I truly believe that government can be a force for good, and I am proud that we focused on the issues that matter most to working families like jobs, education, health care, and economic security.

Thank you for the privilege of serving as your Governor, it has been the high honor of my life.

Jon Corzine

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It’s The Day After, The Day After And the Sun Still Came Up This Morning

That’s right ladies and gentlemen the sun still rose and a new day has dawned. It’s time to forget about what happened Tuesday night and move on.

There is no need to feel sorry for ourselves or cast blame on others, the bottom line is that people were / are upset at the direction the State has been heading and they wanted a change in course.

It’s unfortunate though; that those at the bottom of the ship were drowned while many of those who are steering the ship survived the tsunami of disaffection.

Many things can be said about how poorly Jon Corzine ran his campaign but why bother at this point? It was no secret, everyone knew that the governor was going to have a hard time getting re-elected. Many supporter cut their loses early and jump ship before the boat pulled away from the dock, others bit the bullet and stood by his side, hoping beyond hope, that by November 3rd the ship would have righted its course. I admit, I was one of them.

Do I regret my support for Jon Corzine? No I don’t, as I wrote in earlier pieces Jon Corzine best represented the values that I believed in; early childhood education, universal healthcare reform and fiscal responsibility are just a few that I believe in.

People mocked me when I spoke of the last one, but it’s true Jon Corzine kept the growth of property taxes to just 3.7 percent in recent years and this year, the school tax levy was 2.65%, the lowest it has been in over a decade. He also provided $7 billion of direct property tax relief to the residents of New Jersey, more than any other in history.

Unfortunately those accomplishments were not enough to convince the residents of the Garden State to give him a second chance. Voters were angry at his failures, both personal and professional, from Karla Katz to his 800% toll amortization plan. When you put that on top of the current economic realities of the state like unemployment and the prospect of an $8.billion budget deficit for next year, the people had had enough.

When you further consider the election results it seems that the candidates at the bottom of the ticket, the local candidates, the ones on the frontlines, where the ones that took the biggest hit for Corzine’s failures and not the members of he State Assembly, where it looks like only one seat changed hands.

In the local Monmouth and Ocean Counties races, on both the County and Township level, from what I can see, you can count on one hand how many democrats were elected or re-elected in Monmouth but not one democrat was elected in Ocean County, many good men and women were defeated and Democrats in those counties are angry. They are angry because the governor did not put any time or resources into these counties and it showed on Election Day. The Governor lost each county by more than 60,000 votes each and it would seem that Corzine lost the election due to his apathy for the angry residents in Monmouth and Ocean, an anger which than carried its way towards local candidates, and Democrats are not happy about it.

I have heard that there is a groundswell of anger beginning to come to ahead and changes are underway to shake up the leadership in both the Monmouth County and Ocean County Democratic Parties because of it.

I say that while change may be needed there is no need to act hastily. Democrats need to step back and understand that while these loses hurt and may have set the local parties back a few years, their loses were not necessarily caused by bad or ineffectual ideas or practices on their parts. All this means really, is that they need to work harder in the future and not take anything for granted.

After all, the world did not end Tuesday night, the sun still rose in the morning and challenges still need to be faced. All that has changed is the day, we still need to make the best of it.

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