NJ Legislature sends $35.3 billion state budget to Christie

After months of hearings and debate, a $35.3 billion state budget landed on Gov. Chris Christie’s desk Thursday, courtesy of a pair of party-line votes in the New Jersey Senate and Assembly.

The Senate voted 24-16 and the Assembly 47-31 to approve the spending plan. Both votes were carried by the Democratic majorities in each chamber. No Republicans voted for the budget, which includes tax surcharges on businesses and millionaires and a $3.1 billion payment to the public employee pension system.

Christie is expected to veto the tax increases and reduce the pension payment with his line-item veto authority.

He also may veto additional spending and budget language included in the Democratic-sponsored plan, including restoration of the state’s earned income tax credit to 25 percent of the federal level. Christie cut it to 20 percent in 2010 during his first year in office.

Lawmakers won’t have to wait long for Christie to act.

He is scheduled to take action on the budget Friday morning, in what is likely to be his last official action before his expected formal announcement of his candidacy for the White House next week.

A balanced budget must be signed into law by the start of the new fiscal year Tuesday. Democrats have never succeeded in overriding a Christie veto. To do so would require several GOP votes, unlikely considering no Republicans voted in support of the plan or the tax increases.

The so-called “millionaire’s tax” raises the state’s highest income tax rate from 8.97 percent to 10.97 percent on earnings above $1 million. The one-year corporate business tax surcharge would boost that rate from 9 percent to 10.36.

Democrats said both increases are needed to help meet the state’s obligations, notably the pension payment. The Democrats’ proposed $3.1 billion payment is more than double the $1.3 billion Christie proposed to make in his February budget address.

The larger payment would comply with a payment schedule Christie and the Legislature crafted in a 2011 pension and benefits reform law that required most public employees to pay more for their pensions and health care coverage.

Earlier this month, the state Supreme Court ruled that Christie and the Legislature are not obligated to follow that schedule. The decision drew scorn from public employee unions and Democratic lawmakers, who vowed to send the governor a budget with the full promised payment.

Christie has said the state cannot afford to make the growing payments, and has called for additional reforms that include freezing the existing pension plans and creating a defined contribution system similar to a 401(k) but under the control of public employee unions.

Democrats argue that the state must keep its promise to employees before seeking additional reforms.

The debate played out on the Senate and Assembly floors before votes on the budget and tax increases.

“None of us are leaping to press the green button,” Assemblyman Troy Singleton, D-7th of Palmyra, said before the vote on the millionaire’s tax, “but when you have bills to pay and obligations to meet, sometimes you have to do things you don’t want.”

Singleton said the increase would impact less than 2 percent of New Jersey’s residents and would amount to 2 cents on each dollar earned over $1 million.

Assemblyman Chris J. Brown, R-8th of Evesham, said that more efforts should have been made to cut spending, and that the tax increases would not solve the state’s pension crisis.

“(Reforms) need to happen in New Jersey or it’s going to be the doom of New Jersey,” Brown 

 

original article 

TROY SINGLETON
ASSEMBLYMAN, 7TH DISTRICT
400 NORTH CHURCH STREET, SUITE 260
MOORESTOWN, NJ 08057
 
Tel: 856-234-2790
Fax: 856-234-2957
Email: AsmSingleton@njleg.org