Under Governors Kean and Whitman, New Jersey established a reputation as a business-friendly state with a record of job growth and balanced budgets, but not anymore. I’ve seen Gov. McGreevey’s budget proposal for 2004. Even considering current economic circumstances, it’s not pretty.
Over the next several weeks, the N.J. State Legislature will hold hearings on the governor’s budget.
Many of us remember when the governor released the $23.6 billion Fiscal Year (FY) 2003 budget last year, saying it would help working families and restore responsibility in state government. The budget was a disaster, replete with increases in taxes and fees.
The budget actually increased state spending by $2 billion, almost 10 percent, from its 2001 expenditures.
McGreevey has proposed a $23.7 billion budget for FY04, reducing the rate of increase to 1.3 percent. He has also suspended the offset two-thirds of projected budget increases. Cuts have been made in pensions within the Benefit Enhancement Fund, aid for schools and higher education, Charity Care payments, property tax relief, retirement health programs and the arts.
If you look over the text of the budget proposal, you can’t avoid noticing that cuts to state programs and services are insufficient in low priority expenditures and that spending cuts are tilted too heavily at school aid and property tax relief programs, not bureaucracy.
The governor has never truly believed in property tax relief programs, such as the Homestead rebate, calling it a “crazy program” while visiting the College. You have to question whether or not he really believes in property tax relief in the first place.
He’s not doing enough to address the budget deficits. Look no further than his efforts in the last budget, which left a $5 billion budget deficit for FY04, despite claims that the last budget would put state government back on track.
The FY04 budget recommends revenue enhancements of nearly $900 million. There was talk about a new hotel tax last year. Well, now it’s here, along with a whole array of other taxes and fees.
He suspended a majority of projected budget increases and cut many expenses by less than $2 billion, not factoring in all the major spending increases, which are almost as substantial.
From 2002 expenditures, McGreevey has increased spending overall on direct state services, grants-in-aid, state aid and capital construction.
The budget proposal does not indicate any real effort to reduce bureaucracy, such as reforming state employee pension and health benefits.
It should do a lot more in reducing certain public safety, health service, educational, social service and general government expenditures.
I would support initiatives that freeze school aid and reduce assistance to public colleges if I were truly convinced that the executive budget did everything possible to cut appropriations across-the-board.
Because McGreevey targeted school aid so heavily, property taxes are increasing at the highest level in 10 years, and this policy will continue for a second consecutive year.
This is the same politician who continuously criticized Gov. Whitman by suggesting her 30 percent reduction in the state income tax, which doubled revenues, was responsible for local property tax increases. Now he’s attacking the former governor for her history of fiscal mismanagement, even though she was able to finance her budgets.
We should cut the state budget, but we should do it for the right reasons.
The state can’t balance the budgets on the backs of property taxpayers, senior citizen or students in public institutions without conducting a serious and extensive reassessment of how tax money is spent in New Jersey.