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4-15-10 In the News Today
'Fact checker: NJ Gov. Chris Christie vs. the teachers' union' Record-STATE HOUSE BUREAU
'N.J. Gov. Chris Christie supports rush to retirement by state workers facing benefit changes' Star-Ledger


'Democrats attack Christie's spending plan for schools' 4-14-10 Philadelphia Inquirer


'NJ teachers union squares off with Trenton over reforms, finances' Asury Park Press


Fact checker: NJ Gov. Chris Christie vs. the teachers' union

Thursday, April 15, 2010 Last updated: Thursday April 15, 2010, 6:56 AM

BY JOHN REITMEYER, The Record-STATE HOUSE BUREAU

Governor Christie’s ongoing public fight with the New Jersey teachers’ union continues as voters throughout the state have their say on school budgets next week.

Christie wants voters to shoot down budgets that would hike already record-high property tax bills if teachers don’t help out by offering to freeze their salaries.

The New Jersey Education Association has responded by pointing the finger back at Christie, saying he is unfairly putting the blame on them while protecting high-income earners from paying a fair share of the state’s $19,000-a-year student education costs.

Beneath all the charged rhetoric is a policy debate about how much is spent on education in New Jersey, and how much of the burden should be covered by local property taxes versus the state income tax.

Here’s a look at key issues and the facts behind the charges.

 STATE AID FOR PUBLIC SCHOOLS

 What the union says: Christie cut $1.5 billion in school aid in just his first three months in office, reductions that will gut the state’s public education system.

What Christie says: School budgets were propped up last year with more than $1 billion in federal stimulus aid distributed by the state that school districts knew was one-time funding. Total state aid for school districts would actually go up this year if Christie’s new budget is enacted on July 1.

What are the facts: Christie had to rebalance the state budget he inherited from former Gov. Jon S. Corzine after revenue collections fell short of Corzine’s budget projections. A total of $475 million in state aid payments to school districts were cut as part of that effort. Christie has also proposed cutting state aid payments by a total of $820 million in the new budget he put forward on March 16. Some of the wealthier districts — and many in North Jersey — stand to lose all of their state aid, but none would see aid cut by more than 5 percent of their last budget. And despite the reduced cash payments to districts, the state will still spend more than $1.5 billion on the medical and Social Security benefits of retired teachers.

 TEACHER SALARIES

 What Christie says: Annual pay raises of 4 percent on average are no longer affordable for property taxpayers who are reeling from the effects of the recession. Teachers should freeze their salaries this year to help out the beleaguered property taxpayers.

What the union says: Teacher salaries aren’t the problem; it’s the $820 million in direct state aid to school districts that Christie has proposed cutting from the state budget on top of the earlier $475 million reduction.

What are the facts: Christie is right when he points out the high cost of teacher salaries. Local government spending is up nearly 70 percent since 2001 and school spending — which includes teacher salaries and benefits — is a big part of that increase. Despite the recession, property taxpayers have seen their bills go up by 56 percent since 2001, to a record-high statewide average of $7,281. But freezing teacher salaries alone won’t fully solve the burden property taxpayers are facing. Benefits contributions the governor wants from teachers would also help, but focusing only on teachers ignores municipal and county governments — which are also contributing to rising property tax bills.

 INCOME TAX RATES FOR THE RICH

 What the union says: While dramatically cutting aid for school districts, Christie is giving a tax break to the rich.

What Christie says: New Jersey’s top earners already pay a disproportionate amount in income taxes thanks to the state’s progressive income tax structure, and the state should be doing more to attract and retain its wealthy residents, not send them away with punitive tax rates.

What are the facts: Christie’s new budget puts income tax rates on those earning more than $400,000 back to what they were for three years under former Gov. Jon S. Corzine. Corzine, however, last year enacted what was supposed to be a one-year rate hike on top incomes to balance his last budget. Democratic lawmakers could have forced Christie’s hand by reinstating the higher income tax rates earlier this year when Corzine was still in office, but they chose not to. And Christie could have simply carried the higher income tax rates into his new budget if chose to. Reinstating the tax would generate nearly $1 billion. But there is no guarantee that money would be used to replenish school aid since it could also fund the property tax rebate checks favored by Democratic lawmakers that Christie, who supported them as a candidate, cut from the budget.

 

Governor Christie’s ongoing public fight with the New Jersey teachers’ union continues as voters throughout the state have their say on school budgets next week.

FILE PHOTO BY DAVID BERGELAND

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New Jersey Governor Chris Christie visited Monclair High School last month to have a conversation with the students. Several students brought signs and protested looming education cuts.

Christie wants voters to shoot down budgets that would hike already record-high property tax bills if teachers don’t help out by offering to freeze their salaries.

The New Jersey Education Association has responded by pointing the finger back at Christie, saying he is unfairly putting the blame on them while protecting high-income earners from paying a fair share of the state’s $19,000-a-year student education costs.

Beneath all the charged rhetoric is a policy debate about how much is spent on education in New Jersey, and how much of the burden should be covered by local property taxes versus the state income tax.

Here’s a look at key issues and the facts behind the charges.

 STATE AID FOR PUBLIC SCHOOLS

 What the union says: Christie cut $1.5 billion in school aid in just his first three months in office, reductions that will gut the state’s public education system.

What Christie says: School budgets were propped up last year with more than $1 billion in federal stimulus aid distributed by the state that school districts knew was one-time funding. Total state aid for school districts would actually go up this year if Christie’s new budget is enacted on July 1.

What are the facts: Christie had to rebalance the state budget he inherited from former Gov. Jon S. Corzine after revenue collections fell short of Corzine’s budget projections. A total of $475 million in state aid payments to school districts were cut as part of that effort. Christie has also proposed cutting state aid payments by a total of $820 million in the new budget he put forward on March 16. Some of the wealthier districts — and many in North Jersey — stand to lose all of their state aid, but none would see aid cut by more than 5 percent of their last budget. And despite the reduced cash payments to districts, the state will still spend more than $1.5 billion on the medical and Social Security benefits of retired teachers.

 TEACHER SALARIES

 What Christie says: Annual pay raises of 4 percent on average are no longer affordable for property taxpayers who are reeling from the effects of the recession. Teachers should freeze their salaries this year to help out the beleaguered property taxpayers.

What the union says: Teacher salaries aren’t the problem; it’s the $820 million in direct state aid to school districts that Christie has proposed cutting from the state budget on top of the earlier $475 million reduction.

What are the facts: Christie is right when he points out the high cost of teacher salaries. Local government spending is up nearly 70 percent since 2001 and school spending — which includes teacher salaries and benefits — is a big part of that increase. Despite the recession, property taxpayers have seen their bills go up by 56 percent since 2001, to a record-high statewide average of $7,281. But freezing teacher salaries alone won’t fully solve the burden property taxpayers are facing. Benefits contributions the governor wants from teachers would also help, but focusing only on teachers ignores municipal and county governments — which are also contributing to rising property tax bills.

 INCOME TAX RATES FOR THE RICH

 What the union says: While dramatically cutting aid for school districts, Christie is giving a tax break to the rich.

What Christie says: New Jersey’s top earners already pay a disproportionate amount in income taxes thanks to the state’s progressive income tax structure, and the state should be doing more to attract and retain its wealthy residents, not send them away with punitive tax rates.

What are the facts: Christie’s new budget puts income tax rates on those earning more than $400,000 back to what they were for three years under former Gov. Jon S. Corzine. Corzine, however, last year enacted what was supposed to be a one-year rate hike on top incomes to balance his last budget. Democratic lawmakers could have forced Christie’s hand by reinstating the higher income tax rates earlier this year when Corzine was still in office, but they chose not to. And Christie could have simply carried the higher income tax rates into his new budget if chose to. Reinstating the tax would generate nearly $1 billion. But there is no guarantee that money would be used to replenish school aid since it could also fund the property tax rebate checks favored by Democratic lawmakers that Christie, who supported them as a candidate, cut from the budget.

 

N.J. Gov. Chris Christie supports rush to retirement by state workers facing benefit changes

By The Star-Ledger Continuous News Desk

April 15, 2010, 5:57AM

New Jersey Gov. Chris Christie and his advisers would welcome a rush to retirement by state workers trying to beat plan to require these workers to pay a portion of their benefit costs starting Aug. 1, according to a report on NorthJersey.com.

 

The report said officials in the Christie administration are preparing legislation to require these payments and require a greater contribution to health care, according to Education Commissioner Bret Schundler. Michael Drewniak, Christie’s spokesman, told the newspaper “Some people say it would lead to a rash of retirements. That’s not necessarily a bad thing. It would free up a lot of possibilities for schools.”

 

Democrats attack Christie's spending plan for schools

TRENTON - Democratic legislators attacked Gov. Christie's spending plan for schools Tuesday, arguing, in a reversal of roles, that the proposal would hurt middle-class suburban school districts.

"If this budget is passed, it will completely dismantle the school funding formula," said Senate Majority Leader Barbara Buono (D., Middlesex) during a meeting of the Senate Budget and Appropriations Committee on the Department of Education. "There's not even a pretense that you're just tinkering with it. This is a complete dismantling."

Christie's proposed budget would reduce aid to schools by $820 million, in large part because more than $1 billion in federal stimulus funds last year will not be repeated.

Christie's education commissioner, Bret Schundler, argued that state support to school districts would actually increase by $238 million, or 2.4 percent in the fiscal year that begins July 1, although overall, school districts will lose 7.4 percent of their state and federal funding.

Under Christie's proposed budget, most school districts will see state aid cut by no more than 5 percent of their overall budgets.

Democrats pointed out that districts that received 5 percent or less of their funding from the state this year would lose all of their state funding next year.

Sen. Paul Sarlo (D., Bergen), chairman of the budget committee, said 41 percent of the state aid to districts in Bergen County was cut; more than a third of school districts statewide would see their state aid reduced by more than 50 percent; and 60 of about 600 school districts would receive no direct state funding.

Several of the lawmakers on the panel, including Sarlo, criticized Schundler for the way he communicated with school districts about proposed cuts. School districts had expected state-aid cuts of up to 15 percent but could, in fact, see 100 percent cuts.

For years, New Jersey funneled a disproportionate amount of state school aid to 31 urban and impoverished school districts, known as Abbott districts, in the aftermath of the state Supreme Court's ruling in the Abbott v. Burke lawsuit. As governor, Jon S. Corzine overhauled the school funding system to direct more state aid to middle-class districts, saying that funding should follow the neediest students no matter where they lived.

Christie's budget would direct a greater proportion of state aid to the former Abbott districts than Corzine's formula, Buono said.

"What this budget does is take a quantum leap backward to a time before we had a funding formula," Buono said. "This budget, if passed as is, would go back to a time when our aid was distributed on an ad hoc basis."

Buono said the former Abbott districts would receive about 60 percent of the state aid to schools under Christie's proposed budget, compared with 55.6 percent this year, including preschool aid.

Schundler told the committee that New Jersey spends an average of more than $19,000 per pupil, one of the highest amounts nationwide. That figure includes benefits such as health-care coverage for retired school employees.

He said school boards and superintendents were not to blame for those high costs, nor were most current legislators. Instead he blamed previous lawmakers, who in years past promised public employees rich compensation without considering their full costs.

The administration anticipates school property taxes throughout the state will increase 3 to 4 percent to offset the lost federal funding.

"That's a much smaller year-to-year increase than has been typical in the past 10 years, but remember: A lot of homeowners have lost their jobs, and even many of those who haven't are still suffering from sharply reduced incomes," Schundler said.

Christie has called on school districts to reopen contracts with teachers and other employees to seek concessions, including wage freezes, to avoid layoffs. Earlier this week, the governor urged voters in elections next Tuesday to reject any school-budget proposal that does not include a wage freeze.

If all the education unions agreed to salary freezes, Christie says, the savings could offset much of the loss of federal aid.

According to the state Department of Education, 20 school districts statewide had teachers agree to either a wage freeze or pay reduction, as of last Thursday. In 141 school districts, administrators, support staff, and/or teachers had agreed to such concessions.

According to a Rutgers-Eagleton Poll released Tuesday, 57 percent of New Jerseyans, despite calling for state budget cuts, do not want state aid to local schools to be reduced. An even larger proportion - 72 percent - opposes making teacher layoffs easier. The same percentage opposes increasing taxes or fees to close the budget gap.

 


Contact staff writer Adrienne Lu at 609-989-8990 or alu@phillynews.com.

 

N.J. will sell up to $2B in bonds for school construction By Lisa Fleisher/Statehouse Bureau April 15, 2010, 10:57AM APBank of America-Merrill Lynch is the lead investment banker on the deal that has N.J. selling up to $2 billion in bonds for school construction TRENTON -- New Jersey will sell up to $2 billion in bonds for school construction, in part to avoid making scheduled bond payments for the current fiscal year and the next, and in part to fund $500 million in already-planned school construction. The board of the state's Economic Development Authority approved the deal this morning at a special board meeting. The size of the eventual bond sale, however, will likely be somewhere around $1.6 billion, said Steve Petrecca of the state Treasurer's office. It depends on the rates available when the bonds are sold within the next month and whether the state can save money over the long run, he said. The deal includes $459 million that was due this year and $205 million due next year. The bonds allow New Jersey to push payments into the future, but does not extend the term — or the end-date — of the state's overall debt plan. Bank of America-Merrill Lynch is the lead investment banker on the deal. NJ teachers union squares off with Trenton over reforms, finances BY JASON METHOD • STAFF WRITER • APRIL 15, 2010 ASBURY PARK PRESS Sunday, 4-11-10, JASON METHOD • STAFF WRITER • April 11, 2010 Gannett News TRENTON — Some of the state's more powerful leaders have privately complained for years about the power of the state's teachers union. Yet virtually none would voice those issues in public or even respond to reporters' questions. But now Gov. Chris Christie is three weeks into a full assault on the New Jersey Education Association, and others are criticizing the union's entrenched stance on pay and benefits, an amazing change for a union long considered the pre-eminent power player in Trenton. The battle appears to be ready to widen. The state's top education chief said in an interview last week that the Republican administration is talking to Democratic legislative leaders and expects to find support for a broad array of new school reforms. Education Commissioner Bret Schundler outlined the reforms and said, “All those things will ultimately move forward, and you'll see the union won't be a participant in these discussions because they've chosen not to.” NJEA President Barbara Keshishian said in an interview that the Christie administration has stopped communicating with the union. She said the NJEA met two or three times with Schundler and held “general conversations,” but there has been nothing further for six weeks. Keshishian contended that many changes sought by Christie need to be done more slowly, and some must be negotiated on a district-by-district basis. “You can't do it in a broad stroke on the state level,” she said. “Nor can he fix years of neglect in a single budget.” The reforms outlined by Schundler include changes in teacher contract-negotiation rules to provide more power to school boards, requirements for employees to pay more toward health benefits, pension adjustments for current employees and county superintendent review of union contracts. The administration had first proposed many of the changes in its proposal to provide local governments a “tool kit” to hold down taxes. Schundler specifically noted that the administration would seek to reinstitute rules that allowed school boards to impose a “last best offer” during a contract impasse. Schundler said those changes are needed because the state has seen a historic drop in revenues, and government must cut costs. The NJEA, Schundler said, is “saying to the people of New Jersey, ‘If the system is insolvent, it's your problem.’” Christie's proposed budget calls for some $820 million less in local school aid than last year. But the governor said that administrators, teachers and school workers can nearly make that all up by accepting a one-year wage freeze. Christie continued to press his case last week when he visited a Morris County school district to praise the staff for agreeing to the freeze. “The teachers union here cared deeply about saving jobs, and the superintendent about preserving what they have here in Boonton,” Christie said. Union members, he added, “had some guts and were willing to go against what was dictated to them from Trenton,” referring to the NJEA. The NJEA has punched back at Christie with a TV ad campaign that contends the governor has the “wrong priorities.” The union wants Christie to extend an income tax surcharge on individuals who make more than $400,000 to bring in another $1 billion and to extend a corporate tax surcharge that would raise $80 million. The state's deficit is estimated as high as $11 billion. As part of his budget cuts, Christie plans on laying off 1,300 state workers starting in January. Keshishian and other union officials have said a part of the money raised through the union's proposal would go toward the state budget, but a good portion would go to local schools. Pete McDonough, who served as spokesman for then-Gov. Christie Whitman, said Christie has, like other great political leaders, found an opponent with which to prove his mark with voters. “Reagan had the air traffic controllers union. . . Bill Clinton had Newt Gingrich, and now Chris Christie has the NJEA,” McDonough said. “They are the foil to him that is allowing him to stake out positions in a clear and forceful way. When you are trying to define yourself, it is helpful to have the light and dark, the white and black.” Until now, the 200,000-member union had held virtually unchallenged sway in New Jersey. The union has handed out millions of dollars in campaign contributions, obtained better pay and benefits for teachers, and thwarted proposed changes such as the school voucher program, all with a highly paid staff working from a very large brick and glass headquarters across from the Statehouse. But in the dust-up over the current state budget, others beside Christie think it's time for the union to give ground. “I have never been more disappointed in the reaction of NJEA to (what is) the most serious crisis in my entire life regarding the state budget,” said Assemblyman Joseph Malone, R-Ocean, the Assembly budget officer and a former teacher and school administrator. Malone said that he had two visitors to his district office one morning late last month: a local teacher who complained about having to pay toward health benefits and an unemployed man. As he listened to the teacher, Malone watched the other visitor walk over to an aide, say his house was about to be foreclosed on and beg for help to find any job available. That scene, said Malone, shows what's wrong with the NJEA's stance. “This is insane,” Malone said. Lynne Strickland, executive director of the Garden State Coalition of Schools, which represents 100 suburban school districts, said the NJEA has become so accustomed to winning political battles that she thinks its leaders believe they can't lose on the pay and benefits issues. But the depth of New Jersey's fiscal crisis has presented a new scenario, she said. “It's hard sometimes when you've won so much. You don't recognize that you don't need to win 10 of 10 times to move forward,” Strickland said. “There isn't an overall sense of empathy that has surfaced yet for people losing jobs.” Michael Riccards of the Hall Institute, a nonpartisan think tank in Trenton focused on New Jersey issues, said state legislators have grown to fear, but not love, the union and hence are sitting on the sidelines now. “Do you notice that the Democrats haven't rallied to the defense of the NJEA?” Riccards asked. One such Democrat might be state Sen. Richard J. Codey, a former governor. In an interview, Codey said he thought Christie's portrayal of the union as the villain is over the top. “I don't think they're the big bully Chris would make them out to be,” Codey said. “That they control the Legislature is totally false.” But Codey also said the teachers are out of touch on some issues, as in their fight against contributing to their health care costs. “To find a person in the private business not (contributing for health care) would be like finding a bald eagle,” Codey said. “They need to understand that.”