Friday, February 18, 2011

Christie Imposes Dollar Discipline: Vetoes 14 Bills

New Jersey Governor Chris Christie today vetoed 14 bills that would reduce revenues by at least $600 million in the first year and billions of dollars over time, without providing a single funding source or corresponding budget reduction to pay for them. Taken as a whole, the bills represent a return to the same irresponsible spending practices and lack of budgeting discipline that brought about the fiscal crisis the Governor has been working to repair. Embracing this package of bills without a plan to pay for them would be a reversal of the progress the Governor and legislature have made in the last year by finally living within the state’s means and operating within a balanced budget in order to make New Jersey once again a true and attractive place for business expansion and jobs creation.

“This is the old way of Trenton politics, which always ends with the taxpayers footing the bill and has created the fiscal crisis we have spent the last year beginning to turn around,” Governor Christie said in his veto message on each of the bills. “Now is not the time for a return to the way business was done in Trenton in the past.”

For the most part, the bills, listed below, are a collection of appropriations, credits and loan programs, set-asides and other financial incentives for which no revenue or funding sources are identified. In view of the continuing fiscal crisis, the Governor has been adamant and realistic in stating repeatedly that all spending proposals, even tax cuts which New Jerseyans deserve, must be considered in the context of the state’s fiscal condition and ability to pay for them and within the confines of a balanced budget.

Governor Christie said, “Job-creating tax cuts and incentives must be paid for and made a priority as part of a long-term, fiscally responsible budget plan for the state. Real reform needs to be more than just a one-shot effort that sounds good in a press release. If we are truly going to re-establish New Jersey as a premier state for economic growth in order to attract new businesses and jobs, we must truly demonstrate a real commitment to fiscal responsibility.”

The Governor noted that, while he does not agree with the substance of all of the economic initiatives in the legislature’s package of bills, some of them embody elements of laudable and worthwhile reforms. In fact, Governor Christie said he was pleased to see some of his own proposals in the bills, which he expects to identify during his Budget Address on Tuesday and which he encourages the legislature to act upon in the context of the balanced budget he will propose next week.

“The legislature’s participation will be vital to the effort to improve the State’s business climate,” the Governor said in the veto message. “However, by passing a package of bills that will cost the State over $600 million in Fiscal Year 2012 by conservative estimates and billions over the next few years without identifying any corresponding reductions in the State’s budget, the legislature has acted prematurely and irresponsibly and in a pattern consistent with the reckless conduct of the past which got us in the current fiscal mess.”

Since taking office, Governor Christie has changed course and advanced policies that will improve New Jersey’s business climate through the exercise of fiscal discipline and spending restraint that rejects supplemental spending requests outside of the budget process. He has sunset the corporate business tax surcharge, put a hard, two-percent cap on property taxes, signed new, robust business attraction legislation, and protected businesses from an average $400 per employee, or 52 percent, increase in the unemployment insurance payroll tax.

The bills vetoed today are as follows:

A3596/S2556 (Oliver, Wilson, Watson Coleman, Spencer/Cunningham) Authorizes local public contract set-aside program for employers who hire former prisoners

S1216/A3589 (Weinberg, Greenstein/Watson Coleman, Mainor, Giblin, Evans, Johnson) Permits small, women or minority owned businesses located in designated regional centers to qualify for loans from EDA as if located in designated urban center

S1540/A3535 (Buono, Oroho/Greenwald, Barnes, Johnson, Pou, McHose, Webber, Moriarty) Consolidates certain business-related categories of gross income and provides 20 year carry forward of certain net losses under gross income tax

S2345/A3398 (Sweeney, Madden. Greenstein/Riley, Burzichelli, Johnson, Moriarty) Expands gross income tax exclusion for pensions, annuities and other retirement income for certain taxpayers

S2373/A3418 (Vitale, Whelan/Coughlin, Lampitt, Tucker, Rodriquez) Allows corporation business tax credit and gross income tax credit for certain wages paid to qualified interns in tax years 2012 and 2013

S2394/A3531 (Sarlo/Burzichelli, Wagner, Vainieri Huttle) Dedicates revenues derived from certain sales and use subject to sales and use tax to provide enhanced incentives for breeding and development of certain racehorses in this State

S2454/A3592 (Madden, Sarlo/Quijano, Schaer, Albano, DeAngelo, Gusciora) “New Jersey Angel Investor Tax Credit Act;” provides credits against corporation business and gross income taxes for investing in New Jersey emerging technology businesses

A1676/S1646 (Greenwald, Milam, Spencer, Chiusano, Pou, Webber/Oroho, Sweeney) Provides single sales fraction for corporation business tax income allocation formula and establishes airline-specific sales fraction

A1851/S659 (Gusciora, Jasey, Greenstein, Spencer, DeAngelo, Wisniewski/Buono, Turner) “Historic Property Reinvestment Act”; provides credits against certain taxes for certain costs of rehabilitating historic properties

A2215/SCS for S2558, 2567 (McKeon, Chivukula, Pou, Conaway, Barnes/B. Smith, Sarlo, Beach) Permits developer to qualify for low-interest loan from EDA when building a high performance green building

A3353/S2545 (Coutinho, Watson Coleman, Fuentes, Lampitt, Quijano/Madden, Girgenti, Sarlo) Establishes a closing fund to provide financial resources for certain economic development projects

A3513/S2544 (Oliver, Greenwald, Voss, Jasey, Wagner, Lampitt, Watson Coleman/Vitale, Weinberg) Establishes the Workforce Shortage Loan Redemption Program

A3584/S2496 (Oliver, Cryan, Moriarty, Green, Watson Coleman. Ramos/Greenstein, Gordon) Creates “Back to Work NJ Program”; makes an appropriation

S690/A2905 (Sarlo, T. Kean/Coutinho, Quijano, Coughlin, Greenwald, Moriarty) “Garden State Film and Digital Media Jobs Act”; expands existing film and digital media production tax credit programs

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