Sunday 6-8-08, N.J. budget talks hit home stretch- THE ASSOCIATED PRESS ... 'New Jersey legislators trying to keep hopes for a mid-June budget agreement alive also plan action in the coming weeks on several other key issues, including measures meant to address housing costs, school construction and economic worries...'

C O M M I T T E E   N O T I C E

           TO:       MEMBERS OF THE ASSEMBLY EDUCATION COMMITTEE

     FROM:       ASSEMBLYMAN JOSEPH CRYAN, CHAIRMAN

SUBJECT:       COMMITTEE MEETING - JUNE 12, 2008

            The public may address comments and questions to Kathleen Fazzari, Allen T. Dupree, Committee Aides, or make bill status and scheduling inquiries to Bernadette Lecato, Secretary, at (609)984-6843, fax (609)984-9808, or e-mail: OLSAideAED@njleg.org.  Written and electronic comments, questions and testimony submitted to the committee by the public, as well as recordings and transcripts, if any, of oral testimony, are government records and will be available to the public upon request.

            The Assembly Education Committee will meet on Thursday, June 12, 2008 at 2:00 PM in Committee Room 11, 4th Floor, State House Annex, Trenton, New Jersey.

            The committee will receive testimony from Scott A. Weiner, Chief Executive Officer, New Jersey Schools Development Authority (SDA), on recent activities of the SDA.

The following bills will be considered:

June 8, 2008

N.J. budget talks hit home stretch

THE ASSOCIATED PRESS

New Jersey legislators trying to keep hopes for a mid-June budget agreement alive also plan action in the coming weeks on several other key issues, including measures meant to address housing costs, school construction and economic worries.

But with the state's July 1 constitutional deadline to adopt a new budget looming,
legislators and Gov. Corzine are trying to reach agreement on his cost-cutting $32.8 billion spending plan.

Lawmakers have missed the deadline four times since 2002, but only during 2006 did the dispute close government, when it took until July 8 to adopt a state budget.

"We're getting there, but not yet,'' Senate Budget Chairwoman Barbara Buono, D-Middlesex, said last week after private meetings between the governor and lawmakers failed to produce an agreement.

Assembly Speaker Joseph Roberts Jr., D-Camden, is confident an agreement is near.

"We'll certainly meet our June 30 constitutional deadline to have our budget passed,'' he said.

Legislators still question Corzine's plans to save $136 million by offering retirement
incentives to 3,000 workers, though they've also proposed cutting taxpayer-paid benefits for newly hired government workers to try to balance the retirement costs.

Corzine contends the move would save money and reshape state government, but legislators note it would also increase taxpayer-paid retirement benefits for state workers. One possible move involves increasing the eligibility age for retirement incentives from 50 to closer to 60.

Corzine's budget plan calls for $2.9 billion in cuts amid economic woes.

It proposes cutting state funding for property tax rebates, municipalities, hospitals,
colleges and nursing homes and seeks new Medicaid copays and higher copays for a prescription drug program for the elderly and disabled.

"It is not easy,'' Corzine said. "We've had to make horrific choices, things that break
your heart.''

Legislators are looking to restore aid for hospitals and municipalities and eliminate the proposed copays, but they haven't unveiled alternatives with Corzine insisting the state spend no more than $32.8 billion.

Meanwhile, the Senate budget committee will hold a Monday public hearing on a plan to ask voters to amend the state Constitution to require public approval for state borrowing.

The state has about $32 billion in debt, making it the nation's fourth-most indebted state.

Since 1990, voters have approved $3 billion in borrowing while the state has borrowed $24 billion without voter approval. This includes borrowing for school construction, public worker pensions and to balance annual spending.

The hearing comes as Corzine tries to get legislators to approve $2.5 billion for more Supreme Court-ordered school construction. Legislators haven't taken action on that plan, though Corzine has told the court he would push legislators to approve it by June 30. Some lawmakers want voters to decide the borrowing.

"It should be put before the public this November, and hopefully we're moving in that direction,'' Buono said.

But Sen. Ronald Rice, D-Essex, said waiting until November would risk increased construction costs.

"We need to get it down now,'' Rice said.

Other measures on tap include:

Reforming state affordable housing laws, most notably by abolishing the state law that allows suburban municipalities to avoid state-mandated affordable housing obligations by paying poorer cities to provide the housing.

Combating mortgage foreclosures. New Jersey has the nation's 13th highest foreclosure rate. One measure would impose a $2,000 fee on subprime loans issued by lenders to raise up to $33 million to help homeowners avoid foreclosure.

Legislation to extend all state and local government construction permits through 2012. Sponsors said many permits are scheduled to expire because of the inability of banking, real estate and construction companies to obtain financing in the economic downturn, but the bill is opposed by environmentalists.

Pension reform's moment

Sunday, June 08, 2008

After wasting a prime opportunity 17 months ago to substantially re vise the state's pension system, a group of lawmakers now wants to have another go at it. Wisely, they plan to use the looming July 1 budget deadline as leverage.

Sen. Barbara Buono, who chairs the Senate budget committee, and Sen. Stephen Sweeney, a champion of scaling back state employee benefits, want the $33 billion budget considered in tandem with a revision of the pension system. It's a smart strategy.

Buono and Sweeney realize that the pressure to get the budget passed by the end of the month offers a unique opportunity to get a long-sought, controversial overhaul of the pension system through the Legislature.

The last time there was seri ous discussion among legislators about reducing the state's pension obligations, Gov. Jon Corzine silenced the talks.

The governor said he alone would address the problem and that would occur at the bargaining table. He did have some success -- moving the retirement age from 55 to 60 for future workers and getting employee pension contributions hiked from 5 percent to 5.5 percent. Fine, but not close to what lawmakers had in mind.

Now Buono, Sweeney and others want to pick up where they left off in December 2006. Specifically, they want to eliminate defined-benefit pensions for part-time employees -- state workers who put in less than 35 hours a week and local government workers who log less than 30 hours a week. They also would have to earn $5,000 -- currently $1,500 -- before being eligible for a 401(k)-type pension program. Employees could amass pension credits for just one government job, and their pensions would be based on an average of the five highest earning years rather than the current three. All changes would apply to future government hires.

Revival of the pension changes comes as Corzine is pushing a reluctant Legislature to approve an early retirement plan that he touts as a way to save the state about $117.5 million next year. Many lawmakers are justifiably concerned that the governor's plan, which aims to pare 3,000 workers from the payroll, would cost too much by prematurely increasing pension obligations. The pension revisions that they want considered would be a way of partially offsetting the cost of the early retirement plan.

In pushing for pension revisions, Buono, Sweeney and oth ers realize that if it's not done now, the opportunity may be lost for years. All 80 Assembly members and the governor will be running for re-election next year, making consideration of anything even slightly controversial unthinkable. That means the generous pension program will continue to strain the treasury at least until 2011. The state can't wait that long.