Capitol Comments – Assemblyman Alex Sauickie
TRENTON – Bing Crosby sang, “You’ve got to accentuate the positive, eliminate the negative.” But in reviewing Gov. Sherrill’s proposed budget, I can’t do that if I’m going to provide a useful report.
I will get to the positive, and there was some in her first budget address to the Legislature. But I’ll go through the negative first so that we can have a happier ending to this column.
First, I said before the speech that I would keep a tally of how many times she would blame federal policies for New Jersey’s terrible financial condition, as she tends to talk a lot about the president and the federal government – rather than her eight-year predecessor – as responsible for our state’s woes. She stayed true to form in her speech.
I counted 20 times when she blamed Washington for our state’s troubles, including 10 naming “Trump” directly, four negative remarks about Washington and a couple about “federal cuts.” Only once did she mention the man ultimately responsible for our last eight state budgets, but it was to commend him for making full pension payments – largely on the terms set by his predecessor.
Yet she admitted we have “a broken budget” because Trenton has “taken the easy way out – opting for a quick fix, instead of laying the foundation for a solid future.” If that sounds familiar, it may be because I have been saying essentially the same thing for years, along with plenty of others.
The top lines are these: Sherrill proposes to increase spending by nearly $1.9 billion, a 3.2% increase that sounds small only because spending is already so high because of former Governor Murphy’s budgets. If Sherrill’s budget were to be enacted as proposed, it would mean a total spending hike of 75% since former Gov. Christie’s final budget. Under Christie the budget went up $5 billion (18%) in 8 years. Under Murphy it went up $25 billion (72%).
In her earlier presentation with Treasurer Aaron Binder, Sherrill seemed to imply that she would deal with a $3 billion structural deficit – the difference between spending and reliable revenue – by reducing spending. She only partially did so, mostly by cutting property tax relief for seniors.
I’ve written extensively, for years, on how the state’s fiscal condition – with the structural deficit actually more like $4 billion – could jeopardize full funding of the Stay NJ senior property tax relief program. Under Stay NJ, seniors have half of their property taxes reimbursed up to $6,500 if their household income is less than $500,000.
Sherrill’s budget proposal validates the concerns I wrote about. It would cut the maximum benefit to $4,000 – a 38% reduction – and slash eligibility by reducing the income limit to $250,000.
Stay NJ was a priority of Assembly Speaker Craig Coughlin, who was of course seated behind Sherrill when she announced the program cuts. He may choose to fight her on that as the budget is considered by the Assembly, but the governor pointedly said in her speech, “If there are things you think we need to add – come to me with places we can cut. It’s simple math: any additions require subtractions.”
But while she’s cutting Stay NJ, she’s still increasing overall spending by almost $2 billion. She’s “funding” most of that by taking $1.3 billion out of the $6.7 billion surplus, further reducing our financial protection against possible emergencies or falling revenue.
Certainly the biggest disappointment in the speech is the lack of any reforms to the horrendous and unfair school funding formula, and no recognition of the many suburban and rural school districts that continue to have their state aid cut. While Sherrill bragged of a “record investment in K-12 education,” Newark is slated to get a $60.6 million increase but Jackson will lose another $681,000.
Further, in a state that’s regularly listed as among the worst, and often the worst, places to do business in our country, Sherrill is not just maintaining the tax surcharge on bigger employers, but raising business taxes by over $700 million. On the day of her speech, Exxon Mobil announced it was moving its business registration to Texas, citing that state’s “policy and regulatory environment that can allow the company to maximize shareholder value.”
While Sherrill’s proposed budget is a net negative for the reasons given above and in many other ways, I did say that I’d get to some positives. At this stage, though, they are minor lights of promises in a still-dark fiscal outlook for our state.
Sherrill said she plans to streamline permitting, and create a “Permitting Dashboard” to let people follow the progress of their applications. That’s good for businesses and others, but won’t improve our state’s standing as unfriendly to business.
She also plans to upgrade the licensing system at the Division of Consumer Affairs, which would be good for the many people who have to deal with the state to get their professional licences and certifications. She intends to create a Report Card on state spending to improve transparency on the use of taxpayer dollars, although it remains to be seen how well this administration will report on itself.
Finally, in a statement issued after the speech, Sherrill said she “looks forward to working with the Legislature to modernize and stabilize the school funding formula.” It needs more than that, but OK.
Here I am, Governor, raising my hand. I have some ideas.
Alex Sauickie is a life-long Jackson resident who represents his home town and 12 other towns in the State Assembly. Follow him on Facebook or visit his website at AssemblymanAlex.com.
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