Posted on 01/27/2006 7:27:42 AM PST by randita
Posted on Fri, Jan. 27, 2006
Corzine advisers calling for taxes
Their transition report has outlined unpopular budget solutions. N.J. lawmakers joined in a chorus of boos.
By Kaitlin Gurney Inquirer Trenton Bureau
TRENTON - Expand the sales tax to include clothes and online purchases. Tax 401(k) retirement accounts. Raise the gas tax. Consider a temporary increase in the state income tax.
With New Jersey's finances "perilously close to ruin," Gov. Corzine's budget advisers have recommended these unpopular solutions and more to fill what they estimate to be a $6 billion hole in the state's budget.
The grim transition report advises the Wall Street financier-turned-governor to immediately prepare plans to lay off state workers and cut government services. It also suggests that Corzine develop ways to control skyrocketing costs for pensions and schools - including raising the state's retirement age and revisiting funding for needy Abbott school districts.
"In two short decades, under both Democratic and Republican administrations, the state has gone from a financial powerhouse to a financial basket case," states the report, obtained first by the Press of Atlantic City. "While the road to decline was often paved with good intentions, the results are alarming."
Indeed, according to the six-page paper, the state faces a cumulative debt load of nearly $30 billion because past governors borrowed money to mask financial problems.
Corzine must contribute $1.2 billion to state pension funds this year just to keep them solvent, and state funds for roads, schools and open space are nearly bankrupt.
"Clearly, sacrifices will have to be made. Pain will have to be shared. There must be the political will to make substantive, structural budget changes," the report warns.
While lawmakers are fond of blaming the opposing party for the condition of the state's $28 billion budget, they universally condemned the solutions the Corzine advisers outlined.
Senate President Richard J. Codey, who as governor cut property-tax rebates but rejected suggestions to expand the sales tax and tax 401(k) accounts, said the recommendations were politically impossible.
"Now, if we do all that, who would that leave that wouldn't be pissed off at us?" the Essex County Democrat asked.
Republicans were no kinder. State Sen. Diane Allen (R., Burlington) said she hoped Corzine would "take parts of the report and throw them away," while Senate Minority Leader Leonard Lance (R., Hunterdon) said spending must be cut before tax-increase proposals would be entertained.
"New Jersey is at a tipping point," Lance said, noting that residents are already burdened with heavy property, business and income taxes. "Our residents are moving to Pennsylvania and beyond, and new taxes would exacerbate an already difficult situation."
Administration officials confirmed that their advisers had written the report, but cautioned it was a draft and that final transition reports would be released later. After winning election, Corzine consulted with a team of fiscal experts including former state treasurers and Rutgers University professors.
Corzine is expected to outline his state budget to the Legislature in March. He has selected a former associate from Goldman Sachs, Bradley Abelow, to serve as state treasurer. Abelow started work Monday.
The otherwise dour paper ends with a personal message, telling the multimillionaire Corzine that he is "a uniquely qualified governor serving at a unique time. You possess a deep knowledge of financial markets and the business community, and have expressed independence and the political will to do what's necessary and right."
Even if Corzine rejects his advisers' advice, it is important for the tax-increase and spending-cut proposals to be aired publicly, fiscal watchdogs said.
"Absent money trees sprouting on the Statehouse lawn, we have to come up with additional revenues to plug a budget deficit amounting to some $6 billion, and we need to talk about our options," said Bill Dressel, executive director of the New Jersey State League of Municipalities.
Jon Shure, president of New Jersey Policy Perspective, a liberal think tank in Trenton, said New Jersey's fiscal situation had so deteriorated that "nothing is too outrageous to consider."
"The public can handle this debate," he said. "Having all of this out there is a good thing. For one thing, maybe in comparison, the options he picks won't sound so bad."
Contact staff writer Kaitlin Gurney at 609-989-7373 or kgurney@phillynews.com.
Without spending cuts to at least match, those "tax cuts" are simply future massive tax increases to support the debt that Bush & Co. are piling onto our backs.
no surprise here, democraps run the state. big budgets, out-of-control spending, budget gimmicks, selling GO Bonds to fund the budget, Christmas-tree items, pork, business taxes, hotel fees, fees on tires, etc.
"What does he mean tax 401(k) accounts? We already pay taxes on the money we put in, and then on the $$ that comes out."
not sure where you are but 401K money goes into the account in Pretax dollars
we only pay when we take it out.
Not quite, Tom...for the most part, I think I'm milquetoast. However, I let them know when they're nearing the "Danger Zone", and with a couple of exceptions, my two oldest kids (18 & 16) know when it's time to reassess their situations, and take appropriate corrective actions.
Little ole Nathan turns 4 next month, and he's way ahead of the curve. I figure I have another 9 years to enjoy him before he becomes a teenager. Fortunately, the older two will (hopefully) be grown up by then, and realize that the old man was doing things the right way.
Take care,
Rich
Not exactly 'ALL knowing' BUT knowing ENOUGH to get the F#@K out of New 'all corrupt, all liberal' Jersey! YEP - sure do!!
Doesn't sound any different from the federal government under the Republicans these past 5 years.
yep, not different at all, it's just that the US govt. can print and "borrow" more money at the federal reserve and can sell bonds for billions to RED China. China can cripple us at any time without firing one bullet.
There was no sales or income tax increase, but Maryland hiked the state property tax more than 50%, raised tolls, and tacked on new fees or increased old ones all over the place to a total tune of about $800 million a year.
All of this new revenue was poured directly into the bottomless pit that is the Thornton plan.
Right, like the temporary tolls on the parkway.
LG - so glad we moved ping!
Totally incorrect. The pubs in washington increased spending and cut taxes. The Dems in nj increased taxes and increased spending even more.
The pubs in washington increased spending >>
and the party is proud of that? an almost trillion dollar prescription boondoggle, pork galore in all states, the largest budget in the history of the usa, more domestic spending than lbj and clinton.
I'm not proud of the gop spending. But cut taxes and spend is better than the democrat plan of increase taxes and spend even more.
Hahahaaa...! New Jersey loves socialism and taxes - - just look at the corrupt scum they elect, over and over. They can handle all those tax increases, no problem. In fact, New Jersey is the Kevin Bacon of the United States. "Thank you sir may I have another?"
for what it is worth, this email is from the Ehrlich reelection campaign
Here’s are just some of the facts on Governor Ehrlich’s stewardship of the state:
Turned $4 billion in deficits into a $1.7 billion surplus
Our state is now fully employed, with unemployment rates at 3.9% (and 9 counties coming in under 3%!)
Welfare rolls are at their lowest levels since the 1960’s as more Marylanders move from welfare to work
The Maryland business community’s confidence in the state is at a 10 year high
The Chesapeake Bay Restoration Act and the Corsica River Project are just two examples of historic progress on restoring the Bay
K-12 education is being funded at historic levels
Creation of the Maryland Department of Homeland Security
Cabinet-level Office of Disabilities
Tax on Clothes? What an ass
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