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2-21-11 Governor Christie to deliver State Budget Message for FY2012-2013 today
Star Ledger - Gov. Christie's budget speech will announce plan for proposed income tax cut… Local school districts have felt the biggest brunt of Christie’s previous belt-tightening. He restored some last year, and most expect him to increase state aid. But the governor may also have something bigger in mind. For months, the Christie administration has signaled it wants to overhaul the current funding formula...

Associated Press in the Asbury Park Press, Philadelphia Inquirer, The Record - Gov. Christie faces obstacles in NJ budget proposal

Politickernj.com – Weekly Advance: Week of Feb. 20… One item to keep an ear open for: Christie has said previously that education reform will be a priority this year, so possibly he will address funding issues…. Bramnick: Expect income-tax cut to be key part of budget address

NJ's Smallest School Districts Share Big Worries About Christie's Budget…Schools face uncertain futures as proposals for shared services and consolidations haunt district supers

Star Ledger - Gov. Christie's budget speech will announce plan for proposed income tax cut… Local school districts have felt the biggest brunt of Christie’s previous belt-tightening. He restored some last year, and most expect him to increase state aid. But the governor may also have something bigger in mind. For months, the Christie administration has signaled it wants to overhaul the current funding formula...

Published: Tuesday, February 21, 2012, 6:30 AM Updated: Tuesday, February 21, 2012, 7:14 AM By Jarrett Renshaw/Statehouse BureauThe Star-Ledger

TRENTON — Gov. Chris Christie today will unveil a state budget that is expected to show how he intends to pay the first installment of his proposed income tax cut and how much state aid public schools will get.

The Republican governor will deliver an annual budget speech that kicks off what could be another contentious debate with the Democrat-dominated state Legislature. Last year, Christie sliced about $900 million in programs endorsed by Democrats in finishing a $29.7 billion spending plan.

Mayors, school administrators and residents are hoping the governor will restore some of the cuts he made during the recession. At the same time, Christie will have to chip in far more to the public employee pension system as a result of a reform bill he signed last year. Christie’s office refused to disclose details of the budget in advance of the speech.

Here are several things to look out for:

Schools: Local school districts have felt the biggest brunt of Christie’s previous belt-tightening. He restored some last year, and most expect him to increase state aid. But the governor may also have something bigger in mind. For months, the Christie administration has signaled it wants to overhaul the current funding formula and perhaps send the issue back to a state Supreme Court that will likely include three of his appointments.

Property Tax Relief: While his property tax caps helped keep the growth of local taxes to an average 2.4 percent last year, residents have seen a steep increase in the amount they actually pay. That’s because he slashed property tax rebate checks from their 2009 levels to balance the budget. He has slowly restored some of the cuts, but the current average rebate is still less than half the average $1,037 residents saw in 2009. The relief is funded through income tax revenue, which is on the upswing.

Income Tax Cut: Christie announced a 10 percent income tax cut in January, and today is expected to show how he plans to pay for the first installment. If approved by lawmakers, the cut will be phased in over three years, starting on Jan. 1 of 2013. It would cost about $150 million in the upcoming budget and about $1.3 billion by 2016, according to the Office of Legislative Services. A Rutgers-Eagleton Poll released this morning shows 52 percent of registered voters support the income tax cut plan, but three-quarters would prefer to see a property tax cut come first.

The Economy: While revenues from key economic indicators like income and sales taxes are growing — up 3 percent — they are still falling short of the administration’s conservative projections. If revenue continues to fall short, it will make it tougher for Christie to spend more on things like property tax relief and school aid.

Pension: Christie will have to find a way to make a $1.06 billion payment into the state’s troubled pension system. While it represents one of the largest payments in years, it is still well short of the $3.74 billion payment that actuaries say is necessary. The lack of a full payment undermines the boost the system saw from last year’s health and pension overhaul

 

Associated Press in the Asbury Park Press, Philadelphia Inquirer,The Record - Gov. Christie faces obstacles in NJ budget proposal

 

6:36 PM, Feb. 20, 2012 | Written by Associated Press

TRENTON — New Jersey Gov. Chris Christie will lay out a state budget proposal on Tuesday amid lagging tax collections, a ballooning pension payment coming due and a proposal already made to trim personal income taxes.

The first-term Republican and nationally known fiscal conservative faces another tight year as he announces a spending plan for FY2013, which starts July 1.

Christie’s roughly $30 billion budget comes with built-in pressures: tax collections are off $325 million through the first six months of the current year, a pension payment of nearly $500 million is required to be included in the next budget and the first year of Christie’s 10 percent across-the-board income tax cut would sap $150 million in revenue in its first half-year. Plus, Democrats, who largely gave the governor what he sought in his first two budgets, may be less likely to go along again.

“There is no part of the budget that is easy,” observed Peter Woolley, a political scientist and pollster at Fairleigh Dickinson University. “Obviously, he’s not going to raise taxes, and obviously. He’s not Houdini, so where will the money come from?”

Christie mentioned “spending cuts” at a recent town hall-style event, but wasn’t specific. He’s also hinted that he might tinker with the funding formula for public education, which he’s chafed at since before becoming governor. Perhaps most significantly, he hasn’t explained how he plans to pay for the tax cut, which analysts forecast could cost $1.3 billion when it’s fully phased in in four years, though the administration disputes that figure.

“The main feature is the income tax cut and how to pay for it,” Woolley said. “From the governor’s side, introducing the income tax cut was a way to move the conversation away from raising taxes — for example the millionaires’ tax — and into a dialogue where the Republican is much more comfortable. It puts the onus on the Democrats to argue against tax cuts. It also puts Christie on record as having proposed them.”

Democrats initially opposed the income tax cut as a give-away to the rich at the expense of the poor. They say he should be looking to reduce property taxes, which are the highest of any state in the country. There’s some evidence Christie will seek to blunt the criticism by reviving the earned income tax credit, which he suspended last year.

The AARP agrees with the Democrats. State Director Jim Dieterle has called on Christie to restore two tax relief programs that benefit senior citizens — the Homestead Property Tax Credit and the Senior Property Tax Freeze — to prior levels. Both programs have been cut but not eliminated under Christie.

Christie could also use the budget address to propose a revision of the school funding formula that sends upward of $20,000 per pupil to urban districts without regard to achievement. The governor has already proposed dismantling teacher tenure, instituting a merit pay system based at least partially on student achievement and providing more charter schools and other options for students in failing districts.

Any change to the school funding formula would need court approval. The administration lost a court fight last year when the Supreme Court ordered a $500 million education cut restored because the reduced budget failed to meet the funding requirements set forth by the School Funding Reform Act of 2008.

Christie is also required by constitutional amendment to make a payment to the pension system of nearly $500 million. The state became obligated to begin paying its share as a condition of requiring government workers to pay more into their badly underfunded pension funds.

The budget proposal comes in an economically fragile climate. State unemployment is still hovering at around 9 percent, but there are signs of recovery. For example, the private sector has begun to add jobs. Politically, the proposal comes in a presidential election year, but with neither Christie nor the Democratic-controlled Legislature having to face the electorate in November.

The Legislature must approve the budget. It is required to be in balance.

Politickernj.com –  Weekly Advance: Week of Feb. 20… One item to keep an ear open for: Christie has said previously that education reform will be a priority this year, so possibly he will address funding issues…. Bramnick: Expect income-tax cut to be key part of budget address

By Bill Mooney | February 17th, 2012 - 5:01pm

TRENTON – The governor will deliver his annual budget address on Tuesday before a joint session of the Legislature.

And that will kick off a busy season as far as state lawmakers are concerned. From the starting gun of the budget address it will be a mad dash to the finish line June 30, with partisan twists and turns along the way.

Gov. Chris Christie already has offered a glimpse into where he is heading. In his State of the State address last month, he unveiled his proposal for an across-the-board, 10 percent income tax cut that would be phased in over three years.

Democrats attacked it during a Budget Committee hearing shortly afterward, although one of their own, Joseph Cryan, (D-20), Union, has introduced a set of bills calling for a limited income tax reduction, one that would not benefit the truly high-end wage-earners.

While the actual line-by-line budget figure proposals will not be available for a few weeks, expect the governor to offer an overview of his priorities on Tuesday.

For example, during last year’s budget address Christie issued his call for meaningful pension reforms, which led to months of heated partisan wrangling before legislation was passed.

One item to keep an ear open for: Christie has said previously that education reform will be a priority this year, so possibly he will address funding issues.

Bramnick: Expect income-tax cut to be key part of budget address

By Minhaj Hassan | February 20th, 2012 - 3:45pm

 

TRENTON - In his past two budget addresses, Gov. Chris Christie struck a sobering but still optimistic tone, saying he wanted to make taxpayers part of a historic fight to bring the state back to solvency from its long-standing financial morass.

He called for “shared sacrifice” in his first budget address, cutting state aid for school districts, and rolled back a big chunk of the property tax rebates that had long been a part of the state fiscal formula. He replaced them with a direct credit program that was only a fraction of what taxpayers were previously receiving.

In his second budget address, he said a “new normal” mindset would be in place under the Golden Dome, with state departments adopting a zero-based and performance-based budget philosophy in which they should not assume automatic annual increases were a given. He called for $200 million in business tax cuts, and he has consistently put a stop to Democrats’ attempts to reinstate the millionaire’s tax.

But there were some benefits for working-class households and municipalities, as well. Christie proposed increasing state aid to all school districts by $250 million and called for doubling the tax rebates for income-eligible senior citizens and middle-class families, under the condition the Legislature would agree to reform health insurance and pension systems.

On health insurance reform, it would only be a couple of months later that Christie, along with Senate President Steve Sweeney (D-3) of West Deptford, and Assembly Speaker Sheila Oliver (D-34) of East Orange, accomplished that goal. The reforms ideally will help slow down the ever-growing deficits in pension and health benefits, which last year were running at $54 billion and $67 billion, respectively. The governor also called for making a half-billion-dollar payment to the pension funds, a practice that had been ignored by his recent predecessors.

He also increased Charity Care to pay for emergency room visits for poor people by $20 million, and kept in place a payment program for prescription drugs. But he also proposed reforming the state’s share of Medicaid, seeking a global waiver of $300 million. And cities would fall under the spotlight as a battle over $149 million in Transitional Aid – and oversight of the spending – played out during much of last year.

Lawmakers from both parties said on President’s Day afternoon they hadn’t received any specifics of Christie’s Tuesday’s budget address. The tone that Christie set last year was New Jersey as an agent of change, an example that he says is being replicated by other states. He’s already assumed the worst days are becoming a thing of the past, with New Jersey being on the “comeback,” as his town hall banners clearly state.

Assembly Minority Leader Jon Bramnick, (R-21), of Westfield, said that Christie will probably call for a smaller government and the importance of passing the three-year, 10 percent, across-the-board, income tax cut proposal, which many Democrats slammed. The $29.4 billion budget Christie proposed last year was smaller than fiscal year 2011’s was.

“I think he’s proved you can run a smaller government,” Bramnick said. “It’s part of what he’s doing.”

Bramnick said he’s been nothing short of impressed by Christie, and his ability to easily gain attention with his straight-shooting candor.

Across the aisle there is a different sentiment. Assemblyman John Burzichelli, (D-3), of Paulsboro, said that while there’s little doubt the governor will give a good speech, he said “the devil is in the details.” He and party members would like to see a fairer distribution of state funds for public education and more property tax relief for middle-class residents.

He said he still has questions on the Medicaid waiver, and whether all the savings they anticipated will actually materialize.

At a January town hall meeting in Voorhees, Christie told curious onlookers that “a lot of districts will see increased aid …We’re going to do it in a coordinated way.” He said this in response to a criticism from Democrats who questioned how he could do that and provide the income tax cut. However, Christie dismissed the charge as a “false choice.”

In that same meeting, he said, “There’s a lot of things we can do to reduce the size of government,” although he didn’t give specifics.

In last year’s proposed budget, the Department of Environmental Protection faced the biggest cuts, with a 0 percent reduction from Fiscal Year 2011. In that same budget proposal, several departments saw increases compared to the 2011 Fiscal Year budget – Department of Banking and Insurance (2.7 percent), Human Services (9.4 percent), Department of Labor (+5.5 percent), Department of State (+12.1 percent), Department of Transportation (+10.8 percent), and the Treasury Department (12.7 percent).

 

NJ's Smallest School Districts Share Big Worries About Christie's Budget…Schools face uncertain futures as proposals for shared services and consolidations haunt district supers

By John Mooney, February 21, 2012 in Education

They are a big part of New Jersey's notorious abundance of more than 500 separate school districts, the scores of tiny districts of a few hundred students in just a single school or two.

These days, many of them feeling a bit like an endangered species, the fodder for regionalization talk and almost universally tight finances in the lead up to another budget year, starting with Gov. Chris Christie's budget presentation today.

Two years after severe cuts statewide, the state's smallest districts have seen their staffs whittled to a minimum, their enrollments in flux, and their fates uncertain as proposals for shared services and even consolidations are on the move.

Alice Krihak wonders where the next cuts could come out of her one-school district in Winfield, in Union County, where she serves as superintendent, principal and special services director.

"You sit here as a small district like ourselves, and you are looking at every single penny you can," she said.

Krihak is part of a group of administrators from the state's smallest districts who gather regularly to discuss their shared concerns. As some of them met on Friday at the Trenton offices of the New Jersey Association of School Administrators, the depth of their challenges were real as they considered what Christie's next budget could mean and how they will do more with less.

They have been told that their state aid could be held even next year, good news compared with two years ago when cuts were severe. But with Christie laying out the details today, for some there could be reductions in specific aid categories tied to enrollment, an ominous sign for those where the numbers have dropped.

In Andover Regional in Sussex County, the two-school district is for the first time considering a move to take outside students through the state's inter-district choice program.

"It's something we weren't even talking about last year, but due to projected decrease in enrollment and these kinds of costs, we now have to," said Bernard Baggs, the district superintendent.

Baggs said the state's allowable increase of 2 percent in property taxes is already budgeted for next year, just paying for the status quo.

But any cuts in state aid would set them back, he said, a real possibility as Andover Regional is among 19 districts in Sussex receiving the so-called adjustment aid that could be on the block. More than half of Andover's overall aid of $2.4 million is in adjustment aid, which makes up for declining enrollment.

"We'd like to keep what we have, but we do know there will be cuts somewhere," he said. "We don't have the levels [of staffing and students] that others might have, but we still must provide the services."

"In the next two or three years, there will be some very difficult decisions to make," he said.

Each one of the district's represented Friday said their school boards had decided to move to November elections, the chief reason being the uncertainty of the budgets otherwise. Under the new law, districts that move to November no longer must post their base budgets for public vote. As of Friday, more than 400 districts have made the switch, according to the state's school boards association.

"The decision to go to November wasn't a slam dunk for us,' said Janie Edmonds, superintendent of the Mendham Borough's two schools. "They talked and talked about their worries of disenfranchising people. But in the end it was based on protecting children and education for the children who go to the schools."

With its one school, Winfield in Union County entered into a school choice agreement last year and attracted 13 students, mostly from neighboring Roselle. That amounted to an extra $15,000 per child.

"That's a lot of money for us," said Krihak, the superintendent.

It's not as if the smallest districts are reluctant to share services. The superintendents described a slew of consortiums and councils intended to allocate ideas and talent. But for all of them, costs for staffing and benefits -- especially insurance -- only continue to rise, as do the needs of students and the demands of their politicians.

The latest is the statewide push for revamping teacher evaluation, an idea that few argue against until they see the bill for all the training of teachers and equipment required.

This same group of superintendents on Friday also heard a sales pitch for a high-tech evaluation system, complete with video cameras and online databases. It could come to $10,000 a school just to start.

"Maybe we can't do it with all the bells and whistles," Krihak said of the program that is being used in more than 250 schools statewide next year. "But if it's something required, we'll do what we have to do."


Garden State Coalition of Schools
160 W. State Street, Trenton New Jersey 08608
609-394-2828