New Jersey Gov. Chris Christie and lawmakers clashed over whether Democrats’ alternative budget is balanced as debate was to begin today on the plan and on reviving a “millionaire tax.”
The $30.6 billion spending plan, which was introduced yesterday, would send $1.1 billion in additional aid to public schools above the governor’s proposal, according to budget documents. Senate President Stephen Sweeney, a Democrat, said raising the top income-tax rate by 1.78 percentage points would yield $550 million more for public schools.
Christie, 48, said last week that the state would have available revenue of $30.3 billion for fiscal 2012, which begins next month. The first-term Republican said the Democrats’ alternative spending plan is out of balance by about $300 million, based on projected revenue collections next year.
“The proposed budget from the Democrats is just more of the same unrealistic, pie-in-the-sky, fantasy budgeting they brought to New Jersey for the eight years before we arrived,” Christie said June 24. “This proposal reaffirms the Democrats’ commitment to job-killing tax increases and an unrepentant addiction to spending.”
Separate legislation authorizing the tax increase on income over $1 million would raise the state’s top rate to 10.75 percent from 8.97 for the 2011 and 2012 tax years, according to legislation pending in Trenton. The bill would tie the money to full funding of the 2008 education-funding law.
The governor has said he wouldn’t sign any tax increases. By law, Christie can reject specific spending items without killing an entire budget, using line-item veto authority.
“I know there’s not an appetite in my state for increased taxes because people think government spends too much in our state,” Christie said yesterday on NBC’s “Meet the Press.”
“If the governor wishes to dismiss out-of-hand a balanced budget that does not raise taxes, funds our schools, provides real property tax relief to seniors and protects our most vulnerable without even waiting to read it, that is his right,” Sweeney, 52, said in a June 24 statement. He said doing so is “irresponsible and an affront to the working families who are shouldering the burden” of Christie’s past budget decisions.
Last year, Christie froze $2.2 billion in spending after taking office, saying the state’s financial picture had eroded. He has cut about $1.3 billion in aid to local schools since taking office in January 2010. New Jersey’s Supreme Court last month ordered a $500 million increase in funding for schools in poor and urban districts in the next fiscal year.
Christie has said he would consider any plan from Democrats to comply with the high court directive without raising taxes.
“It’s not theater, it’s about principles,” Sweeney, of West Deptford, told reporters June 23 when he announced the proposals for the budget and high-income levy in his Trenton office. “We’re standing up for our principles.”
Lawmakers and Christie must have a budget in place by June 30 or face a government shutdown when the fiscal year begins July 1. Both the governor and Sweeney have said they expect to meet that deadline.
“New Jerseyans cannot afford more of Governor Christie’s budget policies,” said Sheila Oliver, a Democrat and the Assembly’s speaker, in a June 24 statement. “His budget policies have done nothing to improve the lives of working class New Jerseyans suffering under his property tax increases and high unemployment.”
The Democrats’ budget proposal “will be out of balance the minute it is introduced,” Senate Minority Leader Tom Kean, a Republican from Westfield, said June 24. Christie’s 2012 revenue forecast projects added growth of about $500 million compared with an initial forecast, while the Democrats’ plan counts on $800 million more than the forecast.
Brigid Harrison, who teaches law and politics at Montclair State University, said the Democrats aim to limit voter backlash to their support for Christie’s curbs on pensions and health benefits for government workers. The overhaul passed the Legislature after Democrats including Sweeney and Oliver voted with Republicans.
All state lawmakers face elections in November. Unions have traditionally aligned themselves with Democrats in New Jersey.
“There’s a lot of dissension among Democrats and it’s an attempt to assuage their base,” Harrison said June 24 by telephone. “This ship is not sailing, but it enables them to use it as a 30-second sound bite in the election.”
The Democrats’ spending plan also would direct $50 million for police in high-crime cities and include $1 million for women’s health care, which both took cuts in Christie’s previous budget. The Democrats also would expand the earned-income tax credit for the working poor, Sweeney said.
© Copyright 2013 Bloomberg News. All rights reserved.