Category Archives: NJ State Budget

As A Matter Of Fact…Budget vetoes: The scorpion and the frog

July 6th, 2011 | Published in NJPP Blog: As a Matter of Fact …

By Mary E. Forsberg, Research Director

A scorpion and a frog meet on the bank of a stream and the scorpion asks the frog to carry him across on its back. The frog asks, “How do I know you won’t sting me?” The scorpion says, “Because if I do, I will die too.”

The frog is satisfied, and they set out, but in midstream, the scorpion stings the frog. The frog feels the onset of paralysis and starts to sink, knowing they both will drown, but has just enough time to gasp “Why?”

Replies the scorpion: “It’s my nature…”

This parable has many variations: the scorpion and turtle; the snake and dog; the viper and farmer. What each variation has in common is a bad actor, a character who can’t play fair, even if it means he might perish.

Those who are reading the press these days may recognize certain similarities with the current state of politics in New Jersey. And the Democratic leadership surely is croaking now.

It wasn’t a surprise that the governor wielded his ax against the Millionaires’ tax and women’s health programs. He did it before. He said he would do it again and he did it.

What was surprising, though, were the other cuts that had nothing to do with policy and everything to do with the very nature of his leadership. The cuts are unprecedented and go beyond any reasonable policy and fiscal considerations.

The Legislature

The budgets of the Executive office, the Legislature and the Judiciary have always been sacrosanct; a “gentleman’s agreement” has traditionally given each responsibility for its own budget and spending.

No governor before has chopped 41 percent from the Legislature’s staff salary accounts, but that’s exactly what the governor did. And he did it with a dose of venom, saying:

“The budget as adopted by the Legislature relied upon exaggerated revenue estimates, flawed assumptions concerning fund balances and ignored the harsh reality of its spending decisions. This reduction, among many others enumerated herein necessitated reductions of known surpluses, imprudent spending and other excesses.”

People who have noticed this salary cut haven’t made much of it. But the fact is, it has the potential to shift the balance of power in the legislative branch. Here’s how that works.

The salary accounts that the governor cut will not affect the salaries of legislators or those of their district office staff. The ones cut supported the Democratic and Republican legislative committee aides and the people who run the partisan staff offices in Trenton. Money for those salaries is appropriated to the Senate and Assembly in a lump sum and is divided based on which party is in the majority – the majority party (currently the Democrats) gets more of the money, has a bigger staff and has the larger suite of offices.

Unless the Legislature overrides this veto with a 2/3 vote (which would require the support of both parties), the staff of those offices will be significantly reduced. How these cuts are shared will be up to the majority Democrats in the Senate and Assembly. And as Assembly Speaker Oliver, a Democrat, was quoted as saying, “I’m certainly not going to shoot myself in the foot.”

Whether the governor understands this or not, a greatly reduced Republican partisan staff in Trenton is certainly a possible outcome of this line item veto.

Higher Education

Students and institutions of higher education felt the sting of the governor’s veto, which cut full-time and part-time Tuition Aid Grants (TAG) below even his own budget recommendation in March. He reduced the Democrats’ appropriation by $48.5 million, even though the amount in the Democrat’s budget was only $21.3 million more than his budget recommended.

In another unusual veto, the governor reduced the number of state-funded positions at each college by nearly 1,200 positions overall. This veto is an easy one to overlook and understanding it isn’t straightforward. What it means, however, is that the governor is reducing the state’s obligation to pay fringe benefits costs for these positions and is transferring those costs to the colleges – all without prior consultation and at the last minute. It is a backhanded way of again reducing the state’s responsibility for its higher education system. For Rutgers University and the Agricultural Experiment Station, this represents a 6 percent loss; for the other colleges, a 5 percent loss.

The veto message was again venomous. He blames the Legislature for this cost shift, saying:

“The Legislature’s failure to appropriately fund health benefit costs for all state employees necessitated a reduction in the state’s support of employee fringe benefits at all public institutions of higher education.”

Legal Services to the Poor

If you are poor in New Jersey and have a legal problem, save it until next year – maybe. Like the TAG scholarship, legal services will be significantly less than even what the governor proposed in his March budget.

His veto eliminated all state funding ($600,000) for the legal clinics at Seton Hall University Law School, Rutgers Newark Law School and Rutgers Camden Law School. In March he budgeted each of them for $200,000 apiece.

He also apparently took umbrage at the additional $5 million included by the Democrats in their budget for Legal Services of New Jersey, which provides legal services to poor people in civil matters. He cut that budget by $10 million – leaving Legal Services of New Jersey with a smaller budget than he recommended in March.

Cleaning up New Jersey

The Governor’s veto cut $18.8 million or 16 percent of the amount he recommended in March for Department of Environmental Protection programs that safeguard and preserve the state’s environment – for remediation of hazardous waste, underground storage tanks, monitoring water, and dealing with diesel pollution. Funding for these programs comes from a 4 percent constitutional dedication of corporate business tax (CBT) revenues. The effort by the governor and some in the Legislature to ensure that New Jersey is “open for business” by doing away with regulations and reducing corporate taxes means less money is available to protect New Jersey’s environment.

The moral of the budget

No one expected the governor to move away from his ideological position on funding health care for women or to abdicate his protection of the wealthiest in the state from the Millionaire’s tax, which would have added an additional 1.78 percent to their income tax bills this year.

But the veto message this year went beyond negotiation and fair play. There are consequences to every action. The scorpion’s sting meant death to both the scorpion and the frog. The consequences of this veto message are a less prosperous state and an increase in the chasm that separates the state’s wealthy from everyone else.

For a complete list of the governor’s line item vetoes, see the chart


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Filed under As a Matter of Fact, blog, Democrats, Gov. Chris Christie, line item veto, Millionaire'sTax, New Jersey Policy Perspective, NJ State Budget, veto override, women's health issues, working poor

Countdown: How Big a ‘Bully’ is Chris Christie?

If you haven’t been keeping up with Keith Olbermann since returning to the airwaves last month,you’ve been missing out on some good TV. Last night Olbermann ran a segment that addressed NJ Senate President Steve Sweeney’s recent outburst concerning Governor Christie use of the line-item veto to slash many provisions out of the Democratically crafted State budget.

Sweeney went ballistic on Friday, calling Christie every name in the book after learning of the cuts. Evidently Sweeney is feeling a little betrayed and let down by the Governor after delivering him his victory in the fight over pension and benefit reforms with state workers unions.

In the future, Stephen Sweeney should be a little more leery about who he intended to make a bed with. Once you decide to sleep with them, your soiled for life and it is hard to undo sleaziness of how you feel after.

After all, what did Sweeney expect from a big bully like Chris Christie? Once a bully, always a bully. Your either a friend or a foe, there’s no in-between. And Christie has made it very evident what he considers Sweeney to be. The problem for Sweeney however, is that many of his constituents around the state are also beginning to see where Sweeney stands on the issues and they don’t like it.

On Friday, New Jersey Senate President Stephen Sweeney called Governor Chris Christie a “bully” and a “rotten bastard.” And that wasn’t all. Keith talks with Evan McMorris-Santoro of Talking Points Memo about the political betrayal that set Sweeney off and what it reveals about New Jersey’s large-and-in-charge governor.

http://c.brightcove.com/services/viewer/federated_f9?isVid=1&isUI=1

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Filed under Countdown with Keith Olbermann, Gov. Chris Christie, health benefits and pension reform, line item veto, NJ State Budget, public unions, Stephen Sweeney

>New Jersey Policy Perspective President Deborah Howlett’s statement on the FY2012 New Jersey state budget

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July 1, 2011

Governor Christie’s profligate use of the line item veto on the state budget enacted by the Legislature this week did serious damage to virtually every constituency imaginable in this state – except for corporations and the super-rich.

Christie red-lined a litany of critical funding needs: health care for working families; tax credits for low-wage workers; after school programs for inner-city youth; legal counsel for indigent defendants; drugs for people with AIDS; college scholarships for gifted middle-class students; a resource center for Hispanic women; protective services for abused children; postpartum education; legal clinics; libraries; museums; mental health services; technology and even public television programming. The list is as long as it is damaging.

Unlike responsible governors in states such as Connecticut and California, Christie chose only to make cuts in services to balance the state budget. He refused to sustain the critical investments in New Jersey’s social infrastructure that have allowed all of its residents to enjoy a broadly shared prosperity.

The only winners in the governor’s budget are corporations that will continue to rake in hundreds of millions of dollars in tax subsidies; those wealthy residents whose yearly income exceeds $1 million; and a governor who continues to choose partisan politics over sound public policy.

It’s now up to the Legislature to right these wrongs by over-riding the governor’s veto, line-by-line if necessary.

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Filed under budget adoption, Gov. Chris Christie, line item veto, New Jersey, New Jersey Policy Perspective, NJ State Budget

>NJPP: In the end-game for the NJ state budget, the stakes couldn’t be higher.

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June 20th 2011,

Dear Supporters,

Over the next two weeks – as the Legislature rushes to produce a budget that won’t drown in the ink from the line-item veto pen – we’re all too likely to fully realize the “new normal” that Governor Christie talked about when he proposed his budget four months ago.

It goes something like this:

Rich people and corporations get tax breaks.

The middle class will pay more.

We will all have to make do with less.

Instead of a balanced approach that includes revenues – like the courageous governor of Connecticut proposed – New Jersey’s budget relies only on cuts in services.

Instead of finding ways to invest in building blocks of a strong economy – schools, police, libraries, health care, parks, roads and bridges – the governor has dug in even further, promising to veto any tax increase, including a tax on millionaires’ incomes that has overwhelming public support. Even as state revenues start to rise a bit in the recession’s wake, the administration in Trenton insists we can’t afford:

Health care for working parents if they earn more than $115 a week.

Women’s health care at family planning clinics, even though it means missing out on federal matching funds, an increase in unintended pregnancies and higher costs to treat uninsured patients.

Maintaining the state Earned Income Tax Credit for working poor families, who have seen their taxes increase by $300 a year – the equivalent of a week’s wages – while the wealthiest got a tax cut.

Meanwhile, the state has found more than enough money to hand out $1 billion in subsidies and tax breaks for developers and corporations, including some of the most profitable businesses in the state. Extensive research and plain old common sense show that these giveaways don’t create jobs.

That’s where we come in.

As we have for 14 years, NJPP is shining a spotlight on important policy decisions with the goal of having a state government that promotes broadly shared prosperity for all New Jerseyans instead of picking winners and losers.

We’re proud to be a leading voice for fairness in New Jersey, using solid research and strategic communications to strongly advocate for those who have the smallest voices in the public arena – the poor, working families, the disabled and other vulnerable people in our society.

And we couldn’t do it without you.

NJPP’s generous supporters understand why our work is so important to the vision of New Jersey they want for themselves and their children.

You’ve received several emails from us in the past week highlighting our work.

Now, we are asking for your help.

Please click on the “donate” button below and give to NJPP today.

By contributing you will enable NJPP to keep digging deeper into tough policy issues and widely share our findings to make a difference in people’s lives. Every donation counts, whether it’s $1,000 to print and publish one of our reports or $50 to cover the cost of copying documents requested through the Open Public Records Act.

As you follow what’s going on in Trenton with the budget and other issues over the next couple of weeks, I ask that you keep in mind the work New Jersey Policy Perspective is doing and the role that you can play.

Together, we can create a “new normal” that lifts up every one of us, not just the privileged few.

Thanks so much for your support – past and future.

Sincerely,

Deborah Howlett, President

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Filed under Gov. Chris Christie, line item veto, Middle Class, New Jersey Policy Perspective, NJ State Budget, OPRA requests, tax breaks for the rich, Uncategorized, women's health issues

>NJPP – Special budget update: Take two

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You might have seen media coverage of the Rev. Jesse Jackson in New Jersey the other day. He talked to reporters in the hot sun on the steps of Citigroup building in Jersey City about the need to invest in schools, cities and people – not throw tax breaks at financial institutions which are just hoarding capital in this lousy economy.

I was struck standing there with him not just by how important it was to have someone of Jackson’s stature here in New Jersey delivering a message about help for working people, but how great it was that he was delivering the Better Choices budget coalition message.

You see, sometimes, the work we do at NJPP that matters most is behind the scenes – work we get the opportunity to do because years of credible research and strategic messaging have put us in a position to influence events.

This week is a great example.

Before Reverend Jackson went before the media I briefed him at the request of our coalition partners on a paper analyst Sarah Stecker and I wrote that identified $1 billion in tax subsidies that the state has awarded to corporations the past 16 months. That work is at the core of the Better Choices push for investment in services that lift up all New Jerseyans rather than providing tax breaks to corporations and the wealthy.

Jackson is an icon of the civil rights era and one of the strongest voices fighting poverty in America. He was in New Jersey for a series of labor rallies, as well as news conference on behalf of Better Choices to talk about the surge in corporate taxpayer subsidies here in New Jersey. At our table in the Westin Newport, I outlined our research that showed 70 major corporations have been awarded a total of more than $1 billion in taxpayer subsidies on the promise to create jobs.

Citigroup is a prime example. The bank received $87 million in subsidies since 2004. The expectation was that the financial giant would justify the subsidy by hiring 3,750 people. (Citi is still 1,000 jobs shy, by its own count). The latest Citigroup subsidy was approved in March – $12.3 million to bring 400 jobs from New York State to Jersey City. Three weeks after it was awarded the subsidy, Citigroup announced it was laying off nearly 300 workers at one of its New Jersey sites. Not a very good deal for New Jersey taxpayers, as it turned out.

Jackson, over a bowl of Raisin Bran, grinned and turned the analysis into a newsworthy sound-bite: “They got the money, we didn’t get the jobs. … We should be investing in people, not corporations.”

I was delighted to play my small role in Jackson’s visit to New Jersey. And even if I can’t resist the temptation to do a little name-dropping, more importantly I hope sharing this anecdote helps illustrate to you the important work we do here at New Jersey Policy Perspective.

More to come…

Deborah Howlett, President

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Filed under Citigroup, civil-rights movement, corporate tax breaks, Debrorah Howlett, New Jersey, New Jersey Policy Perspective, NJ State Budget, Rev. Jesse Jackson, update

>A special state budget update from NJPP President Deborah Howlett

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In his budget address three months ago, Governor Christie outlined his view of the “new normal” in New Jersey. It went something like this:

  • Rich people get tax breaks.
  • The middle class pays more.
  • We all make do with less.

Most states, instead of relying solely on cuts to services – cuts that threaten jobs and economic recovery and hurt struggling families – have adopted a balanced approach that includes revenues. But the plan laid out by the governor was cuts-only. It would close state facilities for the profoundly disabled; continue last year’s devastating cuts to schools; and require deep reductions in health insurance coverage for people with no place else to turn.

Over the next month or so, lawmakers and the governor will work in Trenton toward agreement on a state spending plan for the coming fiscal year.

NJPP will be in the thick of things.

As we have for 14 years, NJPP is fighting for the return of fair and progressive fiscal policies that until recently provided opportunities for all New Jerseyans and prosperity that was broadly shared across the Garden State. In a series of emails over the next couple of weeks I’ll give you more details, but here are a few highlights of the work that NJPP is doing to make a difference.

  • Senior Analyst Ray Castro is a leading voice in the independent and critical analysis of how cuts to NJ Family Care, the state Earned Income Tax Credit, and Medicaid will make it harder for poor and working families to get by.
  • A study by NJPP and the national group Demos showed that a bill to deregulate telecommunications in New Jersey would cost consumers, especially the poor and the elderly. Using the findings in the report, NJ Citizen Action and AARP went to work on lawmakers and in a grassroots effort that included more than 10,000 phone calls to legislative offices they succeeded in getting the measure tabled.
  • NJPP’s report on the proliferation of corporate subsidies is the foundation for ongoing efforts by the Better Choices coalition, of which we’re a member, to restore badly needed revenue. Made up of more than 70 nonprofits — including human services, education, religious, and labor groups – Better Choices is a vocal advocate for a proposal developed by NJPP to raise taxes on the wealthiest among us, those with income (not net worth, but income) over $1 million a year.

We’re proud to be a leading voice for common sense in New Jersey, and to strongly and clearly advocate for those who have the smallest voices in the public arena – the middle class, working families, the disabled and the most vulnerable in our society.

That work was spotlighted in a story published recently by the Asbury Park Press, which caught the attention of one of its hometown readers, rock icon Bruce Springsteen. Speaking of NJPP and our partners, Springsteen wrote in a letter to the editor, “These are voices that in our current climate are having a hard time being heard, not just in New Jersey, but nationally.”

Like you, and The Boss, we refuse to accept the idea that there’s a “new normal.”

Not here in New Jersey.

Not this year.

More to come…

Deborah Howlett, President

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Update: I want to clarify a point made in our earlier email “Special State Budget Update,” which may have left the impression that as a policy matter NJPP is opposed to the closing of state institutions for people with developmental disabilities. We absolutely are not. Further, we understand it is important that the effort to close these institutions be fully funded by the state so that people with disabilities can live in the most integrated setting appropriate to their needs.

Sincerely,

Deborah Howlett, President

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Filed under AARP, Bruce Springsteen, Debrorah Howlett, Gov. Chris Christie, health care cuts, Middle Class, New Jersey Policy Perspective, NJ State Budget, School cuts, service cuts, tax breaks for the rich, Trenton

N.J. Gov. Chris Christie signs an unbalanced budget

Good editorial from the Star-Ledger this morning dealing with the realities of the “unbalanced budget” signed by Gov. Christie yesterday:

“The budget signed yesterday by Gov. Chris Christie will reduce state spending for the third year in a row. The total now is roughly at the same level it was in 2005.

No serious person disputes the need for austerity in these times. We are headed in the right direction.

The pity is that this governor failed to demand the shared sacrifice that he himself made a central criteria for judging the final product. Yesterday, he continued to deny that central fact.

“We tried to spread the pain as evenly as we could,” he told a national television audience.

Here are the facts: The 16,000 families in New Jersey earning more than $1 millon will get an average tax break of $40,000 apiece under this budget. At the same time, a single mom working for minimum wage will pay $300 more in state taxes.


The biggest cuts in this budget are painful but unavoidable. That includes the deep cuts in aid to schools and towns, and in property tax rebates. His single biggest move was to short the pension fund by $3 billion. Together, those moves account for the bulk of the governor’s spending reductions.

The problem is the tax break. If the governor had not insisted on that, he could have softened the blow on the needy considerably.

He would not have had to increase taxes on that working poor mom, or make deep cuts in health care, affordable housing, child-care subsidies and school lunches.

So no, the governor is not spreading the pain. This budget plainly favors the wealthy.

Denying that fact doesn’t make it go away.”


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Filed under editorial, Gov. Chris Christie, NJ State Budget, the Star-Ledger