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Corzine aims to avoid tax hikes,insiders say He also plans to balance budget w/o selling the Turnpike Sunday, Feb. 18, 2007 Star-Ledger
Corzine expected to deliver budget Officials mum about specific proposals Asbury Park Press on 02/19/07 THE ASSOCIATED PRESS
Poll: People don't expect much from property tax reform Posted by the Asbury Park Press on 02/18/07
State contract talks hit a hurdle on early-retirement issue
Saturday, February 17, 2007 Star-Ledger
Corzine aims to avoid tax hikes, insiders say
He also plans to balance budget without selling the Turnpike
Sunday, February 18, 2007
BY JOE DONOHUE AND DEBORAH HOWLETT
Star-Ledger Staff
Last year he insisted on raising the sales tax to help balance the state budget. This year Gov. Jon Corzine has a different goal: to produce the first budget in six years with no tax increase.
All the numbers haven't been crunched yet, but administration and legislative officials say Corzine is pushing to avoid new taxes in a year when the Senate and Assembly are up for election.
The budget Corzine plans to unveil Thursday also is not expected to include selling, leasing or borrowing against major state assets like the New Jersey Turnpike -- but several sources said the governor is zeroing in on such a plan for future years.
Legislative leaders say they are counting on the governor to propose several hundred million extra dollars for schools. Senate President Richard Codey (D-Essex) said he was told there would be an increase in aid for all school districts, urban and suburban alike.
"Everybody this year will get some bones," Codey said. "It's nothing dramatic, but certainly welcome after five years" in which most districts have seen state aid essentially frozen.
Revenue growth that normally occurs when residents' incomes rise will help Corzine close a projected budget gap of $2 billion. But an assortment of spending cuts also will be needed, said an administration source who asked not to be identified because the governor's address is supposed to be the first official word of the budget. The official confirmed a no-new-taxes budget is the goal, but refused to elaborate on cuts because final decisions are still being made.
Lawmakers in both parties agreed the Democratic governor should forsake tax increases.
"I think it's essential there be no new taxes, and I'm hopeful the governor is able to recommend a budget that does not create new taxes or raise existing taxes," said Assembly Speaker Joseph Roberts (D-Camden), who also said he would insist on more school aid.
"Over the last six years, we have raised virtually every tax in
Whether the budget will be entirely devoid of new "revenue-raisers" is not yet settled, however. Assemblyman Louis Greenwald (D-Camden), chairman of the Assembly Budget Committee, said administration officials have not ruled out reviving a tax on hospital beds that was killed last year by the Legislature. But he said they also were looking at other options to boost funding for financially ailing hospitals. "They would go down that (bed tax) road only because they believe it's in the best interest of the industry," Greenwald said.
Treasury Department officials are continuing to put finishing touches on the spending plan for the fiscal year that begins July 1. It is likely to be in the $33 billion range, up from the current year's $30.8 billion.
"The broad framework of the budget has been put together, and the administration and the governor are now finalizing the details," said Corzine spokesman Brendan Gilfillan. "The budget will reflect the governor's continuing commitment to fiscal responsibility, to targeted investments to help our most vulnerable citizens and to delivering substantial property tax relief to
The biggest goodie in the package for voters -- a $2.2 billion property tax relief program -- has already been approved by the Legislature. It would provide credits of up to 20 percent of most homeowners' tax bills this fall. The money for that will come from the rebate program it replaces and revenue set aside from the sales tax increase.
That includes $700 million in sales tax revenue held over from the current year's budget -- a bonus that will not recur in future years. That is one reason the Corzine administration is studying ways to tap state assets like the Turnpike and Lottery for ready cash. Treasurer Bradley Abelow is expected to lay out detailed options within several days of the budget speech.
Four legislators and three lobbyists have told The Star-Ledger they have either been told by the governor directly, or given strong indications, that Corzine is leaning in favor of a deal that involves the Turnpike -- but without turning it over to private operators.
Instead, they said, the administration is exploring ways to leverage surplus toll revenues into a multibillion-dollar windfall while keeping the Turnpike under state control. The sources spoke on condition of anonymity to avoid upstaging the governor's announcement. Gilfillan said only that the governor is awaiting the treasurer's recommendations, adding "no decision has been made at this point."
Gilfillan confirmed the Treasury Department soon will hire consultants to study how to bolster the state's ailing horse racing industry when a casino subsidy expires late this year. One option: installation of video lottery terminals at the three tracks, as has been done in other states.
Besides fattening racing purses to help the tracks, that could provide extra cash for the budget -- as much as $500 million a year by some estimates.
Codey, one of the racing industry's leading advocates, said he was pleased the administration plans to explore ways to preserve it. Video lottery "obviously has to be number one on the charts with all your competition now doing it," he said.
Barbara DeMarco, spokeswoman for the New Jersey Thoroughbred Horsemen's Association Inc., said installing terminals at state-run race tracks not only would provide a short-term boost but would triple their value to more than $1 billion should the state decide to sell them. Without new funding, she added, "we're doomed."
Corzine was originally scheduled to give his budget speech Feb. 27, but moved it up five days so he can attend the National Governor's Association conference in
Not since 2001, when Republicans controlled the Statehouse, has a state budget avoided significantly higher taxes.
Last year, Corzine raised taxes nearly $2 billion to help close a budget gap that had been estimated at $4.5 billion. The biggest increase came from raising the sales tax from 6 percent to 7 percent and extending it to more goods and services.
Corzine's insistence on that tax increase led to a standoff with the Legislature that shut down state government for a week. The eventual deal dedicated half the revenue from the increase to property tax relief.
While Democrats are hoping for election-year harmony, one potential sore point could be whether Corzine will consider dedicating the other half of the sales tax increase to property tax relief. Roberts, who pushed for that last year, said he will continue to press his case.
"I feel very strongly we need to pursue that," Roberts said. "We need to assure stability and certainty to the property relief we are providing this year. I think dedicating the additional half penny is the best way to do that."
Staff writer John Mooney contributed to this report. Joe Donohue may be reached at jdonohue@starledger.com or (609) 989-0208. Deborah Howlett may be reached at dhowlett@starledger.com or (609) 989-0273.
Corzine keeps patriotic holidays in the public school classrooms
Friday, February 16, 2007
Star-Ledger Staff
Gov. Jon S. Corzine signed a bill yesterday that would continue the teaching of Veterans Day, Memorial Day, Presidents Day, Columbus Day and Commodore Barry Day in
The bill, designed to eliminate a variety of unnecessary mandates imposed upon schools, includes recommendations made by the governor when he conditionally vetoed the original version on Jan. 29.
The original bill was criticized by veterans groups because it would have eliminated the requirement that schools teach about Memorial Day and Veterans Day. Corzine responded by returning those holidays and several others. The bill was intended to reduce property taxes by eliminating costly mandates on schools.
The bill (A-17) was sponsored by Assemblywoman Bonnie Watson Coleman (D-Mercer) and Sen. John Adler (D-Camden).
Corzine expected to deliver budget
Officials mum about specific proposals
Posted by the Asbury Park Press on 02/19/07
THE ASSOCIATED PRESS
Thursday's address marks Corzine's second since becoming governor, this time amid a projected $2 billion budget deficit. His first plan sparked a fight with fellow Democrats in the Legislature, leaving the state without a budget for a week and closing state government in July.
Legislative Democrats say they don't want to repeat last year's fight, but also are hoping Corzine doesn't propose tax increases to help resolve the budget hole.
They already have denounced Corzine's reconsideration of a proposed tax on hospital beds that legislators opposed last year. The proposal would raise money to help hospitals pay for treating people who lack health insurance.
Treasurer Bradley Abelow has said he doesn't expect the administration to propose increasing the state's major taxes, such as the income, sales and corporate income levies.
Overall, last year's $31 billion budget increased taxes about $1.8 billion, the largest amount of any state in the nation. That money helped erase a $4.5 billion budget hole.
Though the budget plan hasn't been unveiled, it should include $2.3 billion for a plan to slice the nation's highest property taxes by 20 percent for most homeowners.
Corzine would like to revive plans first proposed last year to cut taxes for 614,000 families who earn less than $30,000 per year.
"The budget will reflect the governor's continuing commitment to fiscal responsibility . . . to delivering substantial property tax relief to New Jersey homeowners and renters," Corzine spokesman Brendan Gilfillan said.
Legislators want to see the other half of the money raised by last year's sales tax increase also devoted to property tax relief, though Corzine hasn't committed himself to the idea.
Lawmakers also have said they want state aid to public schools increased to help control property taxes.
Corzine may consider increased public school aid by about 4 percent, or about $400 million. It would be the first state aid increase for schools in five years and will serve as interim help while a new school funding formula is developed.
"I would rather work to make sure that we have an appropriate funding formula than one sooner," Corzine said recently.
Corzine and legislators also are hoping a new contract agreement with state worker unions can be reached before Thursday so it can be included in the budget plan.
What likely won't be in the budget address is a plan to sell or lease state assets to raise money to cut $2.7 billion in debt owed next fiscal year.
While the administration has been considering such ideas, officials have said the issue is too complex and important to be rushed so it can be included in the budget plan.
Possibilities include selling development and naming rights to state properties and leasing toll roads.
Poll: People don't expect much from property tax reform
Posted by the Asbury Park Press on 02/18/07
BY JONATHAN TAMARI
Only one in 10 residents believe they will see "significant savings" as a result of the nearly seven-month push to reform property taxes, and about the same amount believe the tax relief will be long-lasting, according to the poll of 654 residents.
Nine percent of those surveyed on the property tax issue believed they would see "significant savings" from the final reform package, which is nearing completion; 45 percent expect "small savings," while 38 percent don't think they will get any relief.
"The message is pretty clear: New Jersey doesn't believe that they're going to get anything real out of these property tax plans," said Patrick Murray, director of the Monmouth University Polling Institute.
About 12 percent of those surveyed believe property tax relief will be long-lasting, 47 percent said it will be short-term, and 34 percent expect nothing.
Among a handful of people interviewed further on the issue, nearly everyone focused on the enhanced property tax rebates, expected to average $1,051 but with wide variations based on income and taxes paid.
To some, like Manalapan resident Frank Marchesi, any relief is welcome, even if he questions if it will last beyond this year.
"Property tax has been such a problem in the state of
Bryan Repa, of Delran, agreed. A 20 percent property tax credit, the maximum amount allowed under the relief plan, is a "drastic improvement" over his existing rebate.
Last year, tax rebates averaged $285 for homeowners under the age of 65.
"Property taxes in
Others, however, said that while they're looking forward to an increased rebate, they don't think it's the answer to their problems.
"It's too little, too late," said Pamela Superior, of
Paul Oliu called the credit "a short-term giveaway," and recalled the beefed-up rebates sent out under Gov. James E. McGreevey that were later slashed when the funding came up short.
"They just give us some crumbs when it's a much bigger issue than I think they're approaching," said Oliu, of
The reform process began with a focus on issues as wide ranging as schools, government benefits, town and school consolidations and government ethics. Some steps were taken in each of those areas, but many plans were altered or killed by compromises and pressure from an array of interest groups and lawmakers. Some reforms remain works in progress.
The most tangible immediate aspect of the proposals are the credits, which will range from 20 percent to 10 percent for people earning less than $250,000.
Much of the blame from the public fell on Gov. Jon S. Corzine, according to the poll. Half of those surveyed said Corzine showed "too little" leadership on property taxes; 33 percent said he did enough. Still, 44 percent of 801 people polled on another question approved of Corzine's overall performance, while 34 percent disapproved.
After the caps and credits won final legislative approval, Corzine said New Jerseyans have "a good right" to be skeptical of relief after years of promises, but he hopes a cap on tax hikes will keep levies under control.
Dan Yancheck said he wanted to give Corzine a chance but believes the governor caved in to labor unions. Yancheck, 70, was briefly retired, but when his wife had a partially paralyzing stroke, he returned to full-time work as a courier in order to get medical benefits. He has become frustrated by seeing public workers who reap the benefits of state-funded health benefits, even in retirement.
"They're no better than we are. I have to pay, who are they that they don't have to pay?" said Yancheck, who lives in the Turnersville section of
Richard Cooper, of
"I was an engineer for a long time. My tenure was to the end of the week," Cooper said. "They've got to get into the real world and find out what's going on."
Diana Allessi, of the Colonia section of
"There's more thought going into this process this time around as opposed to previous administrations," Allessi said.
The poll, conducted between Feb. 8 and Feb. 12, has a margin of error of 3.8 percentage points.
Jonathan Tamari: jtamari@gannett.com
State contract talks hit a hurdle on early-retirement issue
Saturday, February 17, 2007
BY JOE DONOHUE
Star-Ledger Staff
After two weeks of intense negotiations, contract talks between the Corzine administration and state worker unions halted early yesterday morning.
While the impasse may be temporary, those familiar with the talks say it was aggravated by a dispute over the minimum age for early retirement, which is now 55.
Two sources familiar with the talks say state worker unions are upset because they believe the Corzine administration has reached a secret deal with the New Jersey Education Association teachers union to require new employees to reach age 60 and have 25 years of service before retiring. Under that scenario, teachers insured through the state's health plan would not be forced to contribute to their health insurance.
Leaders of three state worker unions now in salary talks with the administration found out about it Thursday night, which added tension to their negotiations, the sources said. Corzine is seeking concessions from state workers on both the retirement age and contributions to the health plans.
The early retirement age flap, and a lack of progress on other fronts, led to the talks ending around 2 a.m. yesterday morning, the sources said.
Lynn Maher, the NJEA's spokeswoman, would not comment when asked if her union had talked with the Corzine administration. While the NJEA does not conduct collective bargaining for local units, it has historically lobbied on legislation that affects teacher benefits statewide. The state oversees the teachers' pension fund, and it manages a health insurance fund that insures about half the teachers.
Brendan Gilfillan, Corzine's spokesman, declined to comment on the status of state worker negotiations. "This is a day-to-day process, and the administration will continue to work diligently towards an equitable solution."
Robert Master, political director for the Communications Workers of America, the largest state worker union, also refused to comment on negotiations, and would not discuss any dispute with the teachers union. "I can't talk for NJEA," he said.
While no new talks were scheduled for the weekend, Master said he views the hiatus as more of a breather than a breakdown.
"I think both sides are making a good faith effort to figure out if there's a deal there that protects the interest of our members and meets the needs of the public," he said. "That continues to be the tone of the negotiations."
Corzine has expressed hope that he can wrap up salary talks, which began in September, before he gives his budget speech on Thursday. In December, he asked legislative leaders to withdraw proposed legislation to trim public employee health and pension benefits as one way to cut property taxes. Those proposals included legislation to raise the early retirement age. The governor insisted it was better for him to seek concessions in the context of the ongoing negotiations.
Corzine's opening position included a two-year wage freeze and givebacks of holidays as well as asking employees to pay more of their health benefits, according to an administration official with knowledge of the talks.
The current contract, which was negotiated in 2003 when the state faced an even bigger deficit, froze wages for one year, then provided a total increase of 11.5 percent over the final three years.
In
