Corzine’s State of the State address is scheduled for 3pm. If you’re watching, share your thoughts in the comments. It’s being broadcast on NJN and News 12.
“Too many office holders have betrayed the public trust…Today the public is frustrated.” Corzine points out the depressingly low voter participation rate in the last election.
We need to change the “credit card culture” of this state’s finances.
“Number one issue facing our state is fixing our financial foundation.”
Corzine says we should enact family leave insurance, more affordable housing, and ban pay-to-play at all levels of government. (hey, that sounds like what Codey/Roberts said we should do last week)
“Talking about our state’s finances is a little like watching the move Groundhog Day.”
Every man, woman and child personally owes $3,700 of state’s debt. First $860 in state taxes go towards interest and debt payments.
Just acknowledged the Congressional delegation.
4 elements to plan:
1. Freeze state spending at current level for next fiscal year. Must find $2-2.5 billion in budget cuts. Adjustments will be painful, but will pay the way to long term stability. Seeks advice from bipartisan group of legislators.
2. Incremental spending levels in future budgets can’t exceed recurring revenue. Ends one-time spending gimmicks. Any non-recurring revenues in the future will be used exclusively to pay down debt, trust fund, or pay unfunded health care costs.
3. Pay down 50% of state debt from toll revenue and fund transportation trust fund. (Super secret)
4. All debt without dedicated revenue source must be approved by voters. Public has told us they don’t trust our judgement (as already required by the Constitution). Stem cell research and open space ballot initiatives were a wake up call. Proposes constitutional amendment for voter-approved borrowing.
More details on asset monetization plan…
Pay back $16 billon in debt. Save $1 billion in annual debt payments. Cut structural deficit by 1/3.
10,000 miles of highways need to be resurfaced over next 10 years. 700 deficient bridges need repair. Need to expand mass transit. (light rail in Gloucester, Bergen). Widen AC Expressway, Turnpike, Parkway. State needs $3 billion by this summer to move forward with Hudson tunnel, or risk losing matching federal fund. Need $40 billion over 10 years to fix, expand roads/transit system.
“My plan involves significant toll hikes….Equally on all users.”
First increase in 2010 of 50%.Three future increases of up to 50% every four years for next 12 years.
By comparison, to fix only toll road bridges and widen turnpike would require at least a 45% increase in toll, or a 12 cent hike in gas tax.
Or 20% income tax increase or 30% sales tax increase…
To achieve by budget cuts alone, would require annual recurring $2.5 billion in budget cuts.
“Pigs will fly over the state house” before there are any realistic tax hikes or spending cuts to fix the budget mess.
Will have 21 town hall meetings in 21 counties.
Turnpike, Parkway, AC Expressway, Rt 440.
Roadways will not be sold, leased or anything else to for-profit or foreign operator. Will be owned by State of NJ. Public benefit corporation (PBC) will manage roadways. Will have own independent non-political board of directors.
Future financial benefits from roadway stays exclusively in NJ for benefit of NJ residents.
“Culture that created one of the nation’s highest tax burdens must end.”
Will debate over 2 months, but must come to judgement by the middle of March in order to move forward next fiscal year.
“If there’s a better plan…put it on the table….. It’s not something I want to do…its something we have to do.”
My thoughts…he was very rational. I like that his plan addresses all the problems facing the state, not just the huge deficit. Paying off the debt only to get back into debt in the future would put us in a worse position than we are now. Requiring future expenses to be matched by recurring revenue is critical if this plan is to go forward without us again falling back into debt. This is going to be a very hard sell, but ultimately, the alternative – to continue the status quo – is not an option.
Sen Tom Kean Jr: “I’ve got great concerns.” “It’s paying off the VISA card with an American Express.” Says we need spending cuts. He wasn’t asked where he’s going to cut $2.5 billion/year every year.
Alex DeCroce: Doesn’t like the plan either. Corzine won’t accept budget cuts we proposed. We could have had $800 million more for property tax relief. HAHAHAHA.
More Kean Jr: Zero-based budgeting. Identify spending cuts. He’s a broken record. Wahhh. We didn’t get a copy of the speech in advance. Someone call the Wahhhmbulance!
DeCroce: Agree with cutting debt in half, but we should go to voters first and ask if they agree.
More thoughts: I’m not too hopeful about this right now. Corzine went out of his way to present an honest assessment of the situation but DeCroce and especially Kean Jr immediately commenced with grandstanding. If the budget problem isn’t fixed, it won’t be because Corzine didn’t try. It will be because of folks like Kean Jr and anyone else who tries to score political points at the expense of our state’s future. I hope the Democratic caucus takes this as seriously as Corzine is. The time for half-measures passed long, long ago.