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BUSY LAME DUCKS
Lame-duck lawmakers may take up controversial school funding formula
Monetization plans remain under wraps
Posted by the Asbury Park Press on 11/8/07
BY JONATHAN TAMARI
GANNETT STATE BUREAU
TRENTON — "Monetization" is out. "Fiscal restructuring" is in.
Democratic leaders are using a new phrase to describe Gov. Corzine's still-secret plan to squeeze billions of dollars out of state assets, such as toll roads. But otherwise the plan remains as it was before Election Day — under wraps — and will stay that way until at least January, Democratic leaders said Wednesday.
But another long-awaited proposal, a new school aid formula, will likely be hammered out during the lame-duck legislative session that begins Thursday and ends Jan. 8, when the old guard leaves Trenton and the lawmakers elected Tuesday take office.
The formula is seen as key to easing the state's property tax woes and narrowing the gap between state aid for some poor school districts that receive the lion's share of support and others that get far less assistance.
State Senate President Richard J. Codey, D-Essex, said there is a "strong possibility" that the funding plan will be discussed and voted on during the lame-duck session.
"It's a tough timetable, but do I think we can get it done? Yes, I do," Codey said.
Codey and Assembly Speaker Joseph J. Roberts Jr., D-Camden, spoke to reporters about plans for the lame-duck session after a meeting with Corzine.
The "lame-duck" voting sessions after an election but before new officials are sworn in are often used by lawmakers to handle controversial topics with fewer political consequences to worry about. Outgoing lawmakers can cast votes without facing ramifications during re-election bids.
The formula will likely be a controversial topic that helps some schools and hurts others with a new method for distributing more than $8 billion in aid.
Roberts said the plan must be handled now because it needs to be part of Corzine's next budget, which will be introduced in February. Codey said the plan may require hundreds of millions of additional dollars, but he did not say where Democrats would find the money.
Corzine's plan for the toll roads, on the other hand, is not ready for public discussion, Codey and Roberts said.
"I think the governor's committed to a very thorough public dialogue. To rush it would be irresponsible," Roberts said.
Roberts and Codey left open the possibility that the plan could still be part of the governor's next budget, which must be adopted by the end of June.
Earlier Wednesday, Corzine said he was still awaiting an opinion from the federal government on the tax implications of his plan. Depending on the answer, he said, he may have to turn to alternative ideas.
"We will be laying down a program when it is properly structured and I can make a recommendation to the public that it's sound," Corzine said.
Sen. Thomas H. Kean Jr., R-Union, said neither the school plan nor the toll road idea should come up during the lame-duck session. The school proposal, he said, could have implications for decades.
Republicans have railed against the secrecy surrounding the road plan, saying Corzine kept it off the table so it wouldn't burden Democrats during election campaigns
A sobering lesson for Democrats
Defeat on stem cells shows public's weary of monetary policies
Thursday, November 08, 2007
BY TOM MORAN
Star-Ledger Staff
New Jersey voters told pollsters this summer that they supported embryonic stem cell research by a margin of 71 percent to 19 percent.
Those are numbers you normally find only when you ask people if they love their mothers.
So the fact that those same voters soundly rejected the stem cell initiative on Tuesday's ballot was a shock, maybe even a turning point.
The meaning was unmistakable. Voters no longer trust Democrats to handle their money.
They're not ready yet to switch partners and hand power to Republicans. But they want their Democrats to sober up.
"We better straighten up and get our house in order," said Sen. Loretta Weinberg, a Democrat from Bergen County. "This progressive blue state is asking questions about what we Democrats actually stand for. The dialogue is going to be different now."
Democrats everywhere were hitting the same theme, sounding like students who just failed math class and were promising to do better during the next term. It might be meaningless chatter, but it was nice to hear.
Sen. Ray Lesniak, one of the Senate's premier deal-makers, acknowledged that it was a mistake for Democrats to buy votes for the stem cell initiative by making sure that every region of the state had its own research facility -- a move that drove up costs.
Yesterday, he was born again as a guy who doesn't like those messy deals.
"We need less compromising, and more principled stands in everything we do," he said. "Those of us who have been around a long time are very good at compromising. And sometimes that's necessary. But sometimes we do it too much."
Senate President Richard Codey sounded remorseful as well, as if he just realized the error of his ways.
"We haven't done a good job over the last couple of decades," he said. "It's like a household that puts too much on its credit cards."
In the next six months or so, we'll see how serious they are. Because the state faces a $3 billion budget gap this year, and a long-term deficit on pension and health costs that is beyond staggering. That pinch makes it nearly impossible to wrestle with big problems like health care and property tax reform.
So ask yourself if the Democrats have it in them to fix the budget. Can they get sober after drinking so heavily for so long?
It has to start with Gov. Jon Corzine. He's a businessman, and he has had his moments of inspiration, as when he insisted on a sales tax increase last year and made the first substantial pension payment in a decade.
But that's only a start. And let's face it -- he is at heart an aggressive liberal who is not about to solve this by shrinking the size of the government.
"I didn't run for public office to be a number cruncher or to play Scrooge," he said during a revealing moment of his budget address earlier this year.
That brings us to the strangest of all schemes, the one that no one can figure out, and the governor cannot explain -- asset monetization.
Corzine has been so cryptic that it's impossible to know what he has in mind.
We know it involves a big toll hike on state highways. The idea is to sign over that toll revenue to a third party in return for a big lump-sum payment that would be used to reduce the state debt.
Can he sell that idea to the public, and to the Legislature?
Maybe. But Democrats have already squandered a good deal of the public's trust by letting the state's finances spin out of control, and by blocking reforms that would bolster confidence in the government.
This will be Corzine's most important test so far, a make-or-break moment for the rest of his term.
And that's where Tuesday's vote of no confidence comes in. He is starting this race from deep inside a hole -- one that Democrats have been digging for years.
Tom Moran may be reached at tmoran@starledger.com or (973) 392-1823.
Corzine tells the voters: 'I hear you'
Governor promises state's poor finances will be put in order
Thursday, November 08, 2007
BY DEBORAH HOWLETT AND JOSH MARGOLIN
Star-Ledger Staff
Gov. Jon Corzine said yesterday he heard voters loud and clear in Tuesday's mid-term election and they are telling him to put the state's fiscal house in order.
"The voters have given us clear instructions to resolve our alarming and pressing financial problems," Corzine said at a Statehouse news conference. "To that purpose, I ask all of my legislative colleagues, from both parties, to join with me and put in place policies that will secure our state's financial future."
It was clearly a reference to his "asset monetization" plan, which would borrow against future toll increases on the New Jersey Turnpike and other roads.
But legislative leaders, emerging from a 90-minute meeting with Corzine later in the day, said that they will not be taking action on the governor's plan until after the new Legislature is sworn in Jan. 8.
"The plan isn't ready yet so we wouldn't have enough time to do it," Senate President Richard Codey said.
Said Assembly Speaker Joseph Roberts, "The governor is committed to a very thorough public dialogue. That's a very important issue. To rush it would be irresponsible. I think we need to take our time with it and let the governor make his case."
Instead, the leaders said the agenda for lawmakers in the lame-duck session over the next two months will include a new formula for state funding of local public schools. They said they expect Corzine to publicly reveal his proposal sometime in the next two weeks.
"The new funding formula is a strong possibility to be introduced and voted on during lame duck," Codey said.
Roberts said the lame-duck session -- the last weeks of a legislative session when retiring lawmakers are still able to vote -- should focus on business that was left unfinished when lawmakers recessed in June: appointments, a proposal to repeal the death penalty, and paid family leave.
School funding falls into the unfinished business realm, Roberts said.
"There's a timeliness associated with the school funding formula because that really needs to be in place by mid-February when the governor does his budget address. I think we would need to tackle that now," Roberts said. "And frankly that's been a work in progress for a couple of years."
Corzine indicated at the news conference that he'd be comfortable if legislators decided to take action on a school-funding formula before the end of the year.
But he cautioned that such a timeline might be too tight for his asset monetization plan, which he insists is still not ready for public consumption.
"We weren't holding back because there was an election," Corzine said. "We will be laying down a program when it is properly structured and I can make recommendations to the public that it is sound."
Corzine said he is still wrestling with the Internal Revenue Service about tax-exempt status for any public corporation created to lease the state's toll roads. If that doesn't pan out, Corzine said, "we might have to move to an alternative plan."
He also said he wants enough time to properly sell the plan to the public at town meetings in all 21 counties, as he promised earlier this year.
"The next six months is a huge opportunity for us as a state to address some of the most important issues that the state has had on its agenda, unfortunately for a decade or more," Corzine said. "Problems have been building up and building up and now is the time to address them."
In his first news conference at his Statehouse office since he signed the budget on June 28, Corzine also subtly signaled that he's solved at least one lingering issue with his "asset monetization" plan -- the dreadful name.
Corzine has taken to calling it a "financial restructuring." Codey, too, said later he'll be referring to it as "fiscal restructuring."
The plan took a political pounding over the summer, with Republicans arguing that it amounts to nothing more than a slick way to increase tolls. Top aides had urged Corzine early last year to find a term to describe his plan that didn't sound like it was wrapped in red tape.
"Whether it's monetization or restructuring under any format, the public expects to see the state's finances put in proper order. We're working on it," Corzine said.
Senate Minority Leader Leonard Lance (R-Hunterdon) said he clearly heard voters, too. "The real message to the governor and the Democratic majority is do not monetize without voter approval and certainly do not do it in lame duck," Lance said. "People are fed up with all the borrowing."
Deborah Howlett may be reached at (609) 989-0273 or dhowlett@starledger.com. Josh Margolin may be reached at (609) 989-0267 or jmargolin@starledger.com.
