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3-26-10 School Aid, Budget Shortfall - Impt Related Issues are Front Page News
Philadelphia Inquirer - Democrat ic legislators say budget must reinstate tax hike –
Inquirer Trenton Bureau - New Jersey's Democratic-controlled Legislature will not approve a state budget unless it reinstates an income tax increase on the wealthy, Senate President Stephen Sweeney (D., Gloucester) and Assembly Speaker Sheila Oliver (D., Essex) said yesterday.

N.J. lawmakers say towns should set sales, income taxes to ease high property taxes By Statehouse Bureau Staff

The Record - State's deep cuts to schools hit home "..."I think the governor is assuming that tax outrage trumps all other forms of outrage and, politically, it's been successful so far," said Bernard Josefsberg, schools chief in Leonia, where a dozen custodians may be let go to help close the $1.3 million shortfall in state aid. "He's forcing, in one fell swoop, revolutionary change, and not the kind of change we deserve."


Freeze N.J. teacher pay: Jobs they save may be their own By Star-Ledger Editorial Board/The Star-Led...


 

Philadelphia Inquirer -  Democrat ic legislators say budget must reinstate tax hike – March 26

By Jonathan Tamari, Inquirer Trenton Bureau

New Jersey's Democratic-controlled Legislature will not approve a state budget unless it reinstates an income tax increase on the wealthy, Senate President Stephen Sweeney (D., Gloucester) and Assembly Speaker Sheila Oliver (D., Essex) said yesterday.

Their mandate presents the potential for a lengthy standoff with Gov. Christie, who has unequivocally vowed to veto any such tax hike.

Sweeney, speaking to The Inquirer's editorial board, said he would insist on reauthorizing a tax hike on incomes of $400,000 and up, even if it meant a government shutdown.

"There's no way he's going to get a budget without it," Sweeney said in his most emphatic public comments to date about the tax. He said Christie's $29.3 billion spending plan cuts programs for the needy and raises taxes for those with low incomes, but leaves the wealthy paying less.

In the meeting, Sweeney also said he planned to advance a softer version of a bill requiring public workers to live in New Jersey, urged teachers to accept wage freezes, and said he would leave his Gloucester County freeholder director's post sometime after Election Day, allowing fellow Democrats to appoint his replacement.

His most forceful comments came on the tax hike, which he said could raise $800 million to $1 billion to offset spending cuts. Asked if he would allow a government shutdown over the tax dispute, Sweeney said "absolutely."

"The poor are going to take a beating on this, so we've got to stand our ground on some of it, and that money can help ease the burden," Sweeney said. He said he did not want to raise taxes, but that extending the higher rates for another year was a fair way to spread the pain.

Oliver agreed that the tax is a necessary piece of the budget.

"While we have not fully undergone our budget process in the Assembly, without question there's strong sentiment from within our ranks that our budget incorporate that," Oliver said in a telephone interview.

Sweeney said the added revenue could help reduce cuts to higher education and urban enterprise zones. Oliver said she would like to restore some funding for education and health-care programs.

Gov. Corzine imposed the tax hike last year on incomes of $400,000 and more, creating three new tax brackets. The top rate, 10.75 percent on income over $1 million, was among the highest in the nation. The tax expired at the end of 2009, and Christie has refused to renew it, saying New Jerseyans' already are overtaxed. He has argued that many small businesses also are forced to pay the tax.

"Mark my words, if a tax increase is sent to my desk, I will veto it," Christie said in his March 16 budget address and has reiterated in public appearances.

The Legislature has until July 1 to approve a budget and send it to Christie. The dispute over the tax figures to loom over the debate.

Democrats could have extended the tax months ago when they controlled the governor's office and the Legislature, Christie spokesman Michael Drewniak said yesterday. That they didn't, he said, is a sign that the tax now is "being used for political advantage."

"Where were Sen. Sweeney and his colleagues in the months leading up to the expiration of that tax? Surely he must have seen the budget crisis closing in fast and knew that something had to be done," Drewniak said.

Sweeney agreed with Christie in other areas. He said most spending cuts the governor proposed would stand. He also backed Christie's call for teachers to accept a pay freeze this year to offset reductions in state education aid.

"If they care about their members, they'll do it," Sweeney said, referring to teachers' unions. He said without accepting the freeze, teachers' fellow union members face layoffs.

Sweeney supported a plan, proposed by Sen. Donald Norcross (D., Camden), to require public workers at all levels of government to live in New Jersey. He said he would offer to change the bill so that only new hires would have to reside in the state.

"I don't think that you disrupt [current workers'] lives where you actually have to uproot them and move them," Sweeney said. "I don't think that's fair, but I think anybody coming on board now, yeah, they gotta stay here."

Sweeney said his dual positions as Senate president and Gloucester County freeholder director are taking a personal toll and that he would leave the county post after Election Day, but before the end of the year. Sweeney, who is also a business representative for the iron workers' union, said many public events draw him to North Jersey late into the night.

"It's clear I need to get out. I'm too busy. I'm working 20 hours a day and I'm killing myself," Sweeney said.

Holding the job until after Election Day means there would be no vote on Sweeney's replacement until next year. In the meantime, local Democrats would appoint a new freeholder.

"The voters elected a Democrat. They voted for a Democrat to serve a three-year term and a Democrat's going to serve a three-year term," he said.


Contact staff writer Jonathan Tamari at 609-989-9016 or jtamari@phillynews.com.

 

 

 

 

Find this article at:
http://www.philly.com/philly/news/new_jersey/20100326_Democratic_leaders_say_budget_must_reinstate_tax_hike.html

 

 

N.J. lawmakers say towns should set sales, income taxes to ease high property taxes

By Statehouse Bureau Staff

March 25, 2010, 8:39PM
TRENTON -- The chairman of the Assembly Budget Committee wants to shake up the way New Jersey residents pay for government, saying towns should be allowed to set their own sales and income taxes as a way to ease the nation’s highest property taxes.

Assemblyman Louis Greenwald (D-Camden) said such a plan would also allow state lawmakers to cut the state sales tax and other levies because Trenton would not have to send as much aid to towns that can generate more on their own.

"How do you get off the addiction of property taxes as the sole source of funding at the local level?" Greenwald said. "There is a way to do this. You’ve got to have some vision."

The idea, however, got a cool reception tonight from Gov. Chris Christie, who wants to get property taxes under control by instituting a 2.5 percent cap on towns’ increases.

Christie said "it doesn’t matter" whether taxes are collected at the state or local level if taxpayers have to pay more.

"So this shell game that we’ve played any number of times ...that has papered over the problems and just continued to increase the amount of revenue, that’s not what we’re here to do," Christie said. "What we’re here to do is to make government smaller and to the extent we can be in concert on that I’m sure we’ll find a lot of common ground."

Greenwald said the idea has worked elsewhere. More than 30 states allow local sales taxes. "This isn’t a new idea," he said.

To get the ball rolling, Greenwald has introduced bills that would lower the state sales tax from 7 percent to 6 percent, and lower or eliminate taxes on lotto winnings, rental cars, cigarettes, and certain lines of insurance. He wants to introduce a bill allowing towns to set their own taxes in May. "What I’m trying to do is get people to start talking about it," Greenwald said.

While New Jersey’s 7 percent state sales tax is one of the highest in the nation, shoppers in other states often pay more at the register. New York has a 4 percent state sales tax but New York City adds another 4.5 percent.

Greenwald said he would allow towns to choose from a range of types of taxes — personal property, income, sales or others.

New Jersey has scattered examples of local taxes. Newark, Elizabeth, Jersey City, Atlantic City and Newark have parking taxes or fees. Newark has a payroll tax.

Some towns also benefit from hotel, tourism and admission taxes, and motor vehicle taxes at airports.

Businesses groups generally dislike the idea of local taxes, worrying they will be targeted for specialized taxes. "That’s not a way to attract businesses to remain here and try to do economic development," said Michael Egenton, a vice president with the New Jersey Chamber of Commerce.

Local governments might not be ready for extra responsibility and power, said Mary Forsberg, interim president of New Jersey Policy Perspective, a liberal think tank. "Just giving local governments the ability to levy sales and income taxes is not necessarily going to solve our problem," she said.

"We need to more fully understand how we spend money in the state."

By Lisa Fleisher and Matt Friedman/Statehouse Bureau Claire Heininger contributed to this report.

 

The Record - State's deep cuts to schools hit home

Friday, March 26, 2010  BY PATRICIA ALEX

Governor Christie's agenda — which includes steep cuts in school aid and pressure on local unions to make concessions — would force sweeping changes in the way public schools operate in North Jersey.

Hundreds of school employees face layoffs in Bergen and Passaic counties as administrators rework budgets to make up for a loss of $166 million in state aid in the two counties. Long-standing programs such as freshman sports and full-day kindergarten are in jeopardy in a number of districts.

Despite that, most school budgets for 2010-11 call for hikes in property taxes. In Teaneck, the budget proposal would raise school taxes by 10.4 percent despite 21 job cuts. Elsewhere, tax hikes of 3 percent, 4 percent and 5 percent are common, and the projected job losses continue to mount: 95 in Wayne, 40 in Cliffside Park, 16 in Wanaque and 10 in Hillsdale.

"The problem with Christie is he's trying to clear up 15 years of mess overnight, and you can't do that without cataclysmic repercussions," said David Verducci, schools chief in Glen Rock. "What Christie has done is nothing more than legalized larceny."

Glen Rock will likely have to cut 15 to 18 jobs to make up the $2.8 million loss in aid and will still need to increase school levies by about 4 percent, Verducci said.

"This is all about shifting the tax burden," he said.

Push for givebacks

Christie is pushing for school employees to accept wage freezes and benefit givebacks to offset the cuts. On Thursday, his office said failure to do so amounted to "the will of a few — the leaders of the teachers union — overriding the larger public interest."

So far, just a couple of teachers unions in the state — including Montclair — have agreed to such concessions, which would nullify collective bargaining agreements.

Union leaders argue that the governor should reinstitute a surtax on people earning more than $400,000 to make up the shortfall instead of asking their middle-class members for givebacks.

"We have a real concern with his priorities — massive budget cuts for schools and tax breaks for the wealthy," said Steve Baker, spokesman for the New Jersey Education Association. "And he's trying to distract everyone from those priorities by demonizing school employees."

Christie has been on the offensive against the NJEA, and its local members have been smarting from the barrage of criticism.

Locally, some administrators have agreed to pay freezes, but there have been no givebacks yet from the larger unions.

"This is a governor who dislikes and disrespects us," said Peter Tirri, president of the union in Paterson, where the median teacher salary is $55,000 and many support staffers earn less.

'Combative' climate

Some administrators expressed concern that the climate has become combative as they scramble to absorb the cuts so quickly. The aid figures were announced just last week, and budgets need to be finalized next week before they go to the voters April 20.

"I think we're going to get into trouble because we're going too fast and we're scapegoating teachers," said Patrick Martin, superintendent in Ringwood. "This whole thing is a horrible mess."

"In this climate, it's hard to offer people optimism," said Mark Hayes, superintendent in Palisades Park, where they anticipate laying off two full-time and 14 part-time staffers.

Many superintendents said they felt blindsided by the aid figures, which were drastically lower than those telegraphed just a few weeks earlier by Education Commissioner Bret Schundler. Some towns, like Glen Rock, lost virtually all state aid.

A spokeswoman for Schundler on Thursday said "decisions evolved. In the end, this way was the fairest way."

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The process has certainly signaled a new era for public school finance in the state.

"We've never had such extreme belt-tightening," said Frank Belluscio of the New Jersey School Boards Association. "It definitely means a change in the way we do business. It is a totally different direction."

Local administrators agreed.

"I think the governor is assuming that tax outrage trumps all other forms of outrage and, politically, it's been successful so far," said Bernard Josefsberg, schools chief in Leonia, where a dozen custodians may be let go to help close the $1.3 million shortfall in state aid. "He's forcing, in one fell swoop, revolutionary change, and not the kind of change we deserve."

Parents are mobilizing in many suburban districts to protest the shrinking budgets.

"We are concerned the cuts are pretty deep," said Mario Iannelli of Wayne. "We want to make sure the reasons we moved to Wayne, including good schools, are not undermined."

Some, such as Verducci, the superintendent from Glen Rock, are warning that the firestorm has just begun. "The real impact of this is going to hit, and then all hell will break lose."

Staff Writers Andrea Alexander, Joseph Ax, Elaine D'Aurizio, Giovanna Fabiano, Karen Sudol, Matthew Van Dusen, Barbara Williams and Deena Yellin contributed to this article. E-mail: alex@northjersey.com

 

Freeze N.J. teacher pay: Jobs they save may be their own

By Star-Ledger Editorial Board/The Star-Led...

March 25, 2010, 5:51AM

All around the state, school districts are planning painful, unprecedented amputations of staff and programs. Local officials are cursing Gov. Chris Christie’s proposed cuts in state aid, but they should be pointing fingers at themselves, too.

When they should have been holding the line on salaries for the past several years, many boards of education instead hugged teachers at the bargaining table and slipped tens of millions of dollars into their pockets with a wink. Now, we’re paying a price.

The Roxbury Board of Education, for instance, might have to cut 51 jobs and slash many extracurricular activities to balance its budget, which has a $4 million hole. But a year ago, as the recession tightened its death grip on the state, the school board agreed to a four-year deal that increases teachers’ salaries 19.7 percent over the length of the pact.

And Roxbury wasn’t alone in its misplaced generosity: Average pay raises for New Jersey teachers last year were nearly 5 percent.

How has the teachers union said thank you? By telling school districts to eat chalk when asked to reopen contracts and renegotiate temporary relief for taxpayers.

This week, the governor called for a one-year pay freeze for teachers, and the New Jersey School Boards Association immediately announced its support. The Star-Ledger has called for a pay freeze for teachers and all public employees to help drowning taxpayers catch their breath.

But the teachers union doesn’t believe its members should share the pain. When asked why not, the New Jersey Education Association’s defiant president Barbara Keshishian told a Star-Ledger editorial board recently, "Because we have negotiated contracts."

In Roxbury, union and nonunion administrators have agreed to salary freezes. Bus drivers and food service employees, too. Everyone is pitching in. Except the teachers.

If the NJEA has its way, teachers will watch friends and colleagues get laid off, class sizes increased and extracurricular programs eliminated — rather than reopen sacrosanct contracts and accept a pay freeze. Remember, these are the same teachers who chanted, "Think of the kids!" during their protest of the governor’s proposed funding cuts. Local union chapters should think of the kids (and the suffering taxpayers), defy their militant state leadership and agree to a pay freeze. It’s the right thing to do.

During Monday’s picketing, Keshishian wondered how Christie would be able to look kindergartners in the eye and explain why there were no crayons or construction paper for them. But the answer is easy: He could tell them Mommy and Daddy are broke and the money went for teachers’ salaries and benefits.

Read the Star-Ledger editorial board's entire Going Broke series