NJ Business Matters: The Blog of the CIANJ

EMP Might Not Ignore Law of Supply and Demand

The state's Energy Master Plan (EMP) is a few years overdue, but today's Star-Ledger reports that one of the changes CIANJ has long supported will sorta be included - increasing the Garden State's nuclear capacity.

Part of the EMP has been known for more than a year, such as requiring that by 2020 at least 20% of the state's energy is provided via renewable resources. The trouble with that goal is that it is just that -a goal. Demanding an increase from our current level of 2% to 20% in 12 years does not mean such a leap will be technologically or economically feasible. In the interim, steps such as conservation offer the ability to reduce demand through behavioral changes.

On the issue of nuclear energy, regular blog readers know our position: nuclear energy is still the only technologically available method to generate sufficient electricity while producing virtually zero greenhouse gas emissions. Therefore, we fully support the relicensing of our current plants and increasing capacity.

The EMP, which may be released in April, must acknowledge the reality of supply and demand,

While not explicitly calling for a new nuclear power plant, the plan concludes "the greenhouse gas mandates point toward nuclear energy to produce carbon-free electricity at a lower price per megawatt-hour than fossil-fueled plants."

Public Service Enterprise Group, the state's largest power producer, is considering building a nuclear unit in Salem County, where it already has three nuclear stations.

"We are ready to play a key role in promoting conservation and efficiency and expanding renewable sources of energy," Ed Selover, general counsel for PSEG, said in a statement. "We are also actively evaluating the feasibility of a new nuclear plant in South Jersey."

On a per capita basis, New Jersey is already among producers of carbon emissions, and a primary reason is our higher reliance on nuclear power than other states.

How Wal-Mart Got It Right

One of the most under-reported stories emerging from the aftermath of Hurricane Katrina, is the way in which the private sector came to the aid of Louisiana in remarkable ways.

An op-ed in today's National Post comments on the lives saved, and the responsibility and authority given to Wal-Mart's employees to help an area in desperate need. It all began with this e-mail from the company's CEO,

"A lot of you are going to have to make decisions above your level. Make the best decision that you can with the information that's available to you at the time, and above all, do the right thing."

Click here to read the piece in its entirety and here for a radio interview with St. Lawrence University economics professor Steven Horowitz.

At Least We're Not Connecticut

The Tax Foundation has released their annual "Tax Freedom Day" study - letting you know just how many days of the year you work for the government, and when you can pay for things like food, clothing and shelter.

Good news, Jersey: Tax Freedom Day for us is four days earlier this year. You can begin working for yourself on May 7th.

The bad news is that the only state with a later Tax Freedom Day is Connecticut. The Constitution State has to keep their champagne on ice until the 8th.

Full study available here, and here's a link to the Tax Foundation blog.

Efficiencies Here, But Real Savings There

As we first noted yesterday here at NJ Business Matters, the legislature's research arm is forecasting state tax receipts to come in below the Governor's original estimate. The difference is a $289 million question that must be answered through either further spending cuts or tax increases. If you're a loyal reader, then you know that CIANJ has outlined a host of possible cuts in areas that government simply cannot continue to afford - such as within the Division of Community Affairs.

This year's budget also features state aid cuts to New Jersey's smallest towns with a way to get the money back if those towns with populations under 10,000 merge or share services. Given the fact 19 of our 120 state legislators are dual office holders, that discussion sometimes becomes terse.

Shared services in small towns would offer some measure of savings, and CIANJ supports efforts to streamline the process and remove legal impediments to mergers that have evolved through state history. However, Assembly Budget Committee Chairman Lou Greenwald strikes exactly the right note when he repeats a message he delivered to our members last May,

He said he's not in favor of cutting the property tax rebate program and instead suggested forcing school districts – which are seeing an increase in state aid in the budget– to become more efficient.

Bingo. New Jersey has 616 school districts - some of which do not even have a school. We spend more per-pupil than any other state, but rank below the national average SAT score, and when you calculate the number of students who pass the HSPA and not the much-discussed alternative test, we rank 24th in graduation rate.

So much of the reason for that is the number of dollars spent that never reach the classroom. Forcing efficiencies there would be a much better use of the budgetary bully pulpit.

Secret Ballot - Meet Executive Order 97

Kudos to Star-Ledger columnist Paul Mulshine for bringing to light a gift to organized labor - Executive Order 97, which gave the Communications Workers of America (CWA) a card check right they had not been given through the legislature.

The Executive Order pertains to community care residential providers (CCRs), who are contractors that provide in-home services to developmentally disabled adults in a manner similar to what foster care provides to children. The Governor's Executive Order gives the CWA the right to represent CCRs at the bargaining table because a majority have signed authorization cards.The government, of course, was under no obligation, but did so anyway.

CCRs are not state employees and therefore not covered under the state's existing card check statute. These types of groups were not included at the time that legislation was passed, only to have the Gov grant the CWA representation rights via Executive Order.

Eventually, it will cost some of America's most overburdened taxpayers even more. The Front Office claims the Order is "revenue neutral".

That may be true this year, but the CWA did not go through a card check process, and the Governor did not sign an EO, all so that the cost would be the exact same, did they?

"They are supposed to be paid based on market rate," said (CWA organizer Hetty) Rosenstein. "We can show what the market rate is so they're paid more.".... 

"It is without a doubt quite a new direction for the CWA and the labor movement in general."

Indeed it is, but it's an expensive direction for the rest of us. The state is already facing tens of billions in unfunded liabilities for benefits granted under the current union contracts. You know how I know that? Because a guy by the name of Corzine has been going around the state repeating it endlessly.

And when we add whole new classes of unionized workers they are going to want lavish benefits as well.

Didn't think so.

Short

The state's economic downturn eventually will be mirrored in state tax receipts. And today the legislature will be told not to count on all the tax collections forecast in the governor's budget message.

The Assembly Buget Committee will hear that tax collections will be $134 million below the Corzine Administration's estimates over the next 15 months. The Office of Legislative Services (OLS), which is the legislature's non-partisan research and legal arm, will be the bearer of bad news.

Bad news that could get worse, that is,

Joseph Seneca, an economics professor at Rutgers University, agrees the state's revenue outlook is more likely to get darker than rosier in coming weeks.

"I think it's an alignment of a number of very potent negatives all pointing to an outlook that can be summarized as one of extreme caution," he said.

Seneca noted that the last time the state suffered a recession in 2001, state income tax collections actually fell two years in a row. That's largely because Wall Street, a major employer of New Jersey residents, was hit hard by the downturn.

The current situation is similar, only potentially worse, Seneca said. Investment banks already are pondering major layoffs due to $250 million in losses from subprime mortgages, he said.

"This recession has the potential to be broader and deeper than the two previous recessions that were shallow and brief," he said.

Time to dust off that list of billions of dollars of potential spending cuts and give it a second look, eh?

Statistical Fiction

Cheers to the editorial board at The Record for criticizing the State Board of Education for failing to abandon the Special Review Assessment (SRA).

The SRA was designed as an alternative graduation test for students who were disabled or simply "froze" during the standard High School Proficiency Assessment. Long-term blog readers know that the HSPA is a test designed at an 8th grade skill level and a requirement for high school graduation.

As The Record points out, the SRA has become a crutch for poor-performing schools used to boost their graduation rates. It has more to do with politics than education.

Twelve percent of the state's high school graduates now get by via the SRA. In the Abbott districts, the state's most impoverished, about a third use the alternative route.

The numbers in some urban schools are simply astounding: Three high schools in Paterson owe the majority of their graduations to the SRA. But the problem is by no means confined to the big cities. Fourteen Bergen County high schools have given the SRA to more than 10 percent of their students. The highest proportions are at Bogota High School (26.5 percent), Englewood's Dwight Morrow High School (19.7 percent), Garfield High School (18.2 percent) and Teaneck Senior High School (15.5 percent)....

If a quarter or a half of a high school's students have not learned enough to meet graduation requirements, the first step toward solving the problem is acknowledging it. Turning instead to a statistical fiction serves no public interest, least of all the students'.

Ditto. The state's 31 so-called Abbott districts spend the same as the state's wealthiest districts on a per-pupil basis, and the majority of funding coming from state taxpayers versus local taxes. Taxpayers and students in these districts deserve much better.

For an excellent rundown of the SRA's failings, check out New Jersey Excellent Education for Everyone's testimony before the Board of Ed.

Following the testimony, the Board voted to make minor changes to the SRA, but keep the program operational. State Board of Education President Ronald Butcher, promised, "We're going to really watch this closely."

About time. 

Jersey Has Lost 10k Jobs in '08 - Time To Increase Payroll Taxes

A quick note to anyone who works for a company with at least two employees: New Jersey's paid family leave mandate may cost you more than bill advocates would have you believe (shocking, we know).

The paid leave program will be funded by an increase in the Temporary Disability Insurance (TDI) tax. Paid leave proponents workers stress that workers will be paying the maximum of $33 per year to fund the new program. Plus there's an initial raid of $25 million from the existing TDI fund with a promise to pay it back. Eventually.

That estimate is based on California's usage rate of about 1%. However, the State Chamber went out and polled their members who offer a paid leave benefit. They found that companies offering paid leave experience a utilization rate of 8%. They aptly point out that if the general population used paid leave at a number close to private sector use, the actual cost to workers in the state would be closer to $250 in keeping with legislators pledge not to have employers directly fund the program. Almost anything above 1% of eligible workers using the benefit would represent higher payroll taxes for workers in New Jersey.

Too bad the Assembly Labor Committee refused to consider a voluntary opt-out for employees in the state, huh.

Add this to the other problems we've enumerated here at CIANJ - decreased competitiveness, cost to employers, lawsuit liability and an economic downturn.  Remember, NJ is one of only six states with paid maternity leave. Maybe six weeks of paid time off for the mothers of newborn children is all we can afford.

Update: A loyal reader of NJ Business Matters wrote to remind us of this January 2008 study, which found fewer than 30% of Californians were aware of the Golden State's paid leave program. If more Californians learn about the program, then surely more are likely to use it - putting the 1% assumption in further jeopardy.

An excellent reminder from a savvy reader. Not to be outdone, CIANJ reminds readers that in January California saw 18,874 workers take advantage of paid leave - if that trend continued for the year, it would represent 1.3% of working Californians.

ILWU Helps Their Members By Protesting Iraq War

Back in April, your friendly blogger used his space in COMMERCE Magazine to point out some of the subtle flaws in the poorly-titled Employee Free Choice Act. You know, things like eliminating the secret ballot from a unionization drive. We opened by charging big labor has slowly morphed from a labor movement into a political one. An allegation with more than a hint of substance, to say the least.

If you need further evidence, you'll get it on May 1 when The International Longshore and Warehouse Union (ILWU) goes on strike to protest the wars in Iraq and Afghanistan.

The International Longshore and Warehouse Union (ILWU) has announced a one-day strike against the wars in Iraq and Afghanistan, calling for a “No Peace No Work Holiday” to take place May 1. They are calling on the AFL-CIO, the Change to Win Coalition, and other unions to do the same. This is a major development for both the labor movement and antiwar movement in the U.S.

The call was first put forward by ILWU Local 10 at a recent West Coast Caucus and was resisted by the ILWU’s top leadership. But rank-and-file support for the call to action pushed it through, with only 3 out of 100 delegates voting against it.

And if you do not agree with the union's position or if you think the wars have little or nothing to do with ILWU's mission? You're short one day's pay, thanks to the union that is supposed to advocate for you.

Hat tip to the NAM and Shopfloor.org.

Good News on Exports

The Governor has just announced that exports from New Jersey increased $3.5 billion in the last year.

From NJBiz:

The 12.8 percent increase exceeds the national growth of 12.1 percent, the governor said. Exports alone support more than 366,000 jobs in the state, he added....

The state's greatest trade gains came from increased commerce with countries like Israel, where the amount of New Jersey products received increased 195 percent last year; the Republic of South Africa, where it grew 60 percent; and India, where it rose 51 percent, the Corzine administration said. Italy, Japan and Singapore also saw Garden State exports increase more than 25 percent in 2007.

In The Face Of Job Losses, Add Mandates

Two e-mails just scurried across the inbox. See if you can make sense of them.

First, the NJ Department of Labor and Workforce Development released its February job figures, which show New Jersey lost another 1,700 jobs in February to add to the 8,600 jobs lost in January. Job losses were led by trade, transportation and utilities (-2,800), manufacturing (-1,100), and construction
(-500).

The unemployment rate climbed by .3% to 4.8%, which now matches the national average.

Simultaneously, NJBiz is reporting that Senate President Codey has announced there will be a special voting session, either later this month or in April, to vote on final passage of the Paid Family Leave mandate.

The meeting would include voting on the paid family leave bill and perhaps voting to confirm Gov. Jon Corzine's nominee for treasurer, David Rousseau, Codey's office said. Usually, legislators spend April focusing on budget hearings and no full Senate meetings are presently scheduled.

If the Senate passes the leave bill, it would go to Corzine, who has said he would sign it into law.

The bill (S-786) was scheduled for a vote this past Monday, but was delayed due to procedural questions.

At some point, legislators have to recognize the cause and effect of their votes, no?

Assemblyman DeCroce With Yet Another Reason To Oppose Paid Leave

Earlier this morning here at CIANJ's worldwide headquarters in Paramus, Assembly Republican Leader Alex DeCroce spoke with about 35 Commerce and Industry Association members about the state budget, the Governor's asset monetization (toll hike) proposal and paid family leave.

As always, we thank the Assemblyman for joining us and sharing the insights of his caucus.

Click here for his memorandum on paid leave, and its impact on doing business in New Jersey - especially the way in which the job-killer would impact small businesses. One noteworthy statistic from the brief:

According to an article in the Wall Street Journal on June 20, 2007, the federal Department of Labor estimates that paid family leave programs cost employers an average of $1.76 per hour per full time employee, or 6.8% of total compensation. Using the above hourly estimate, a company with just ten full-time employees would see an increase of approximately $36,608.

Click here to help stop this from making New Jersey an even more expensive place to live, work and do business.

School Funding Formula Goes For Its Day In Court

The State of New Jersey is filing papers with the Supreme Court to remove so-called "Abbott" status from the state's 31 poorest school districts. The Abbott v. Burke decision is one of the bigger drivers of our highest-in-the-nation property taxes.

in the Abbott case, the NJ Supreme Court ruled children in the 31 poorest school districts were not receiving an adequate education. Therefore, per-pupil spending in those districts must equal per-pupil spending in the state's wealthiest districts. Because you know, 1) it's the court's Constitutional duty to appropriate money and 2) spending more equals better results.

We are left with a situation such as Camden, where per-pupil spending is approaching $20,000 per student, but the real graduation rate (those graduating high school without the benefit of a special exam) stands at about 15%.

The local districts don't have enough revenue to spend $20k per child, so the state (i.e. other taxpayers) is forced to make up the difference plus fund their own schools. Remember, school funding accounts for a majority (and in many cases a super-duper majority) of your property tax bill.

"It is time to abandon this process and refocus, as the School Funding Reform Act does, on providing a thorough and efficient education for all New Jersey children through a unified funding formula," the state's legal brief says.

CIANJ has long-contended that spending in these districts should be at the state average and not at the top of the scale. It's time for the Supreme Court to abandon its bad decision, realize that more money has not produced the desired results, and give alternatives a chance.

Rough Month for Paid Leave Advocates

Regular blog readers all know that the business community's opposition to a paid leave mandate is multi-faceted.

First, we question the wisdom of imposing a mandate unique to New Jersey during a time that is either a recession or an economic slowdown. Remember, virtually every survey available puts New Jersey as the most, or one of the most, expensive places to do business.

Second, we have raised a host of legal questions - most dealing with potential conflicts with anti-discrimination laws. We also note the added hardship this will put on small businesses.

Remember, New Jersey is already one of only six states to offer paid maternity leave - up to six weeks, in fact. Maybe, that's all we can afford in these times.

In the interim, paid leave advocates have decided to respond by throwing around terms such as the "anti-family business lobby". We thought it would be a good time to recap what some independent analysis has determined - and this is just in the last month.

• February 27 - The Department of Labor and Workforce Development announces the state lost 9,500 jobs in January. It also revises its 2007 job increases down to just 3,700 private sector jobs created in an economy of 4.1 million workers.
• March 6 - The Attorney General notes the bill language, which had already been voted on by the Senate and by an Assembly Committee, is insufficient to protect small businesses from lawsuits under state law.
• March 12 - We learn of an Office of Legislative Services (OLS) report which finds that small businesses could be exposed to lawsuits if they do not provide job protection under paid leave. Remember, bill advocates claimed during the entire debate that small companies do not have to hold a job for an employee taking leave.
• March 14 - OLS determines that a Senate floor vote on paid leave cannot take place today, or it could be unconstitutional

Breaking: Paid Leave Bill Will Not Be Voted On Monday

Add this to the list of technical problems with New Jersey's proposed paid leave mandate.

The non-partisan Office of Legislative Services has advised that the legislation cannot be voted upon Monday by the full Senate, under ordinary Senate procedure.

The origin clause of the New Jersey Constitution requires that all legislation which taxes or increases fees must first be passed by the General Assembly and then the Senate. Paid leave was passed by the Senate on March 3rd and the General Assembly yesterday. The Assembly became aware of the issue and passed their own version of the bill, with the Senate's merged within it in an attempt to get around Article IV; Section IV, paragraph 6 of the Constitution. However, the Assembly version differed from the Senate version because of amendments following the Attorney General's letter regarding the lack of explicit small business protection.

OLS has just determined that the parliamentary maneuver does not allow the Senate to vote on the bill Monday. The bill must remain there for at least a calendar day and the Senate will not officially receive the bill until Monday.

It appears that the only options left for the Senate are to have the bill advance on an emergency vote, schedule a new voting session for Thursday or consider it during the next regularly scheduled session. To proceed on an emergency matter, the Senate would need a 3/4 majority - which will not happen.

Update: Senator Kean's Statement is now available on-line.
Update II: Senator Sweeney and Assemblyman Albano - the bill's co-sponsors - have asked the Senate President to pull the bill from Monday's voting schedule, based on the OLS memo. It is now unknown when the Senate will make its final vote.

Assembly Passes Paid Leave Mandate - Updated

The General Assembly just voted 46-30-2 in favor of passing the paid leave mandate on all New Jersey companies. Here are some of the today's highlights:

• During debate, Assemblyman Richard Merkt noted an Office of Legislative Services (OLS) report that found the bill may leave small businesses exposed to potential lawsuits. CIANJ has been stating this possibility since the bill's introduction. No amount of NJ bill language can supersede federal law.
• Bill proponents preferred to call the payroll tax of $33 per year an "insurance premium." That type of semantics is commonplace in debates, but remember the same advocates voted to table an amendment which would have allowed workers to voluntarily opt out of the program. That's a tax increase.
• Here's a link to CIANJ's press release.

The bill is expected to be voted upon Monday in the Senate. Because of an amendment made in the Assembly Appropriations Committee, the Senate must vote on the new bill language. The last time that Chamber took up the measure, it narrowly passed. There have now been two reports - one from the Attorney General and one from OLS - raising the lawsuit concern. The AG's concerns were intended to be addressed through amendments, but there are still many unanswered questions regarding conflicts with federal discrimination laws. Stay tuned.

Update: The final Assembly Roll Call vote is now available and pasted below. A "NO" vote is a vote against the paid leave mandate and consistent with CIANJ's position.

Angelini, Mary Pat - No
Albano, Nelson T. - Yes

Amodeo, John F. - Yes

Addiego, Dawn Marie - No

Barnes, Peter J., III - Yes

Biondi, Peter J. - No

Bramnick, Jon M. - No

Burzichelli, John J. - Yes

Caputo, Ralph R. - Yes

Carroll, Michael Patrick - No

Casagrande, Caroline - No

Chiappone, Anthony - Yes

Chiusano, Gary R. - No

Chivukula, Upendra J. - Yes

Cohen, Neil M. - Yes

Conaway, Herb, Jr. - Yes

Conners, Jack - Yes

Coutinho, Albert - Yes

Coyle, Denise M. - No

Cruz-Perez, Nilsa - Yes

Cryan, Joseph - Yes

Dancer, Ronald S. - Yes

DeAngelo, Wayne P. - Yes

DeCroce, Alex - No

Diegnan, Patrick J., Jr. - Yes

Doherty, Michael J. - No

Egan, Joseph V. - Yes

Evans, Elease - Yes

Fisher, Douglas H. - Yes

Giblin, Thomas P. - Yes

Green, Jerry - Yes

Greenstein, Linda R. - Yes

Greenwald, Louis D. - Yes

Gusciora, Reed - Yes

Handlin, Amy H. - No

Holzapfel, James W. - No

Jasey, Mila M. - Yes

Johnson, Gordon M. - Not Voting

Karrow, Marcia A. - No

Lampitt, Pamela R. - Yes

Love, Sandra - Yes

Malone, Joseph R., III - Abstain

McHose, Alison Littell - No

McKeon, John F. - Yes

Merkt, Richard A. - No

Milam, Matthew W. - No

Moriarty, Paul D. - Not Voting

Munoz, Eric - No

O'Scanlon, Declan J., Jr. - No

Oliver, Sheila Y. - Yes

Polistina, Vincent J. - No

Pou, Nellie - Yes

Prieto, Vincent - Yes

Quigley, Joan M. - Yes

Ramos, Ruben J., Jr. - Yes

Rible, David P. - No

Roberts, Joseph J., Jr. - Yes

Rodriguez, Caridad - Yes

Rooney, John E. - No

Rudder, Scott - No

Rumana, Scott T. - No

Rumpf, Brian E. - No

Russo, David C. - No

Scalera, Frederick - Yes

Schaer, Gary S. - Yes

Smith, L. Harvey - Yes

Spencer, L. Grace - Yes

Stender, Linda - Yes

Thompson, Samuel D. - No

Tucker, Cleopatra G. - Yes

Vainieri Huttle, Valerie - Yes

Van Pelt, Daniel M. - No

Vandervalk, Charlotte - No

Vas, Joseph - Yes

Voss, Joan M. - Abstain

Wagner, Connie - Yes

Watson Coleman, Bonnie - Yes

Webber, Jay - No

Wisniewski, John S. - Yes

Wolfe, David W. - No

DEP Regs Restrict Affordable Housing, Panel Finds

An advisory panel on affordable housing is suggesting it may be impossible to reach the state's affordable housing targets, if Department of Environmental Protection (DEP) housing restrictions are not lifted, according to the Star-Ledger.

"The ... barriers prevent a predictable and efficient land use system from existing, which in turn prevents the state from meeting its current and projected housing demand," the report concludes.

The report, being prepared for the state's Department of Community Affairs, calls for specific measures such as allowing land within 300' of a waterway to be built upon if it has been developed in the past, and to rewrite DEP regulations to allow for flexibility.

It is no secret that New Jersey is limiting its developable land. Unfortunately, the state cannot repeal the law of supply and demand. If government continues to restrict the supply of space, then housing prices are going to increase - which is in opposition to other goals set forth by the Corzine Administration.

We're glad the DCA panel is attempting to make that simple point to NJ's leaders.

Nat'l Job Numbers Out - 63k Jobs Lost

National job numbers were just released and they are much weaker than expected. The nation lost 63,000 jobs in February. The unemployment rate fell slightly, to 4.8%, but the percentage drop is a byproduct of civilians who gave up looking for work and are no longer considered part of the labor market.

The Bureau of Labor Statistics release is available here with complete data available here.

New Jersey's February job numbers will be released by the state Department of Labor and Workforce Development later this month. Last month, New Jersey lost 9,200 private sector jobs.

Why Do We Learn About This Now?

If you haven't been following the debate on Paid Family Leave, then you might not know what a fan proponents of the bill have become of calling us the "anti-family business lobby". They say that we are not being "intellectually honest", are "liars" and that the program will not cause additional expense or be anti-business. We're all for the rhetorical jab, but some of what they're saying is ridiculous.

In the interim, we have been raising serious concerns of the bill - one of the most prevalent being how it interacts with anti-discrimination laws. While paid leave advocates insist small businesses do not have to offer job protection, certain protected classes could file wrongful termination suits under federal discrimination protections.

We've contended all along that the bill leaves employers exposed to potential lawsuits. Now, NJBiz has obtained a letter from the New Jersey Attorney General to the Labor Commissioner, which raises another concern as it relates to the bill's impact on small business.

"If the Legislature so intends, this bill should be amended to specifically preclude (lawsuits) since the current language of the bill does not do so unequivocally," Milgram wrote in the Feb. 27 letter to David J. Socolow, commissioner of the state Department of Labor & Workforce Development. (emphasis ours)

Why are we finding out about this now? This letter was sent before the Assembly Labor Committee hearing, and before the vote by the full Senate. So why did no one choose to release it? If the AP had not obtained a copy of the letter, when would the opinion have been made public?

We're glad the AG has finally paid attention to the issue - even if bill proponents were quick to poo poo it.

Stopping the Raiders

This morning at the worldwide headquarters of CIANJ, yours truly presented to our Human Resource Council on "The Power of Politics". During the sixty-minute presentation, attendees, who kindly laughed at my bad jokes, learned a bit about the legislative process and the actions in Trenton that are most likely to impact their businesses.

One of the topics that came up was the state's Unemployment Insurance (UI) fund. Part of the trouble with the UI fund is that Trenton legislators have used it for purposes other than paying unemployment benefits. During good years, when the unemployment rate is low, the fund runs a surplus that is used to pay other state expenses. Since 1993, Trenton has raided the fund of $4.7 billion.

The problem with that tactic is that during difficult economic times, the fund could run a deficit. When that happens, there is an automatic trigger which automatically increases employer contributions to the fund.

In short, when times are good, employers pay into the fund and Trenton spends the excess cash. Then when times are bad, that rainy day money is no longer available and employers are forced to pay again. You can see why that seems a little unfair to businesses.

Tomorrow in Trenton, the Labor Committee will consider S-562. The legislation, introduced by Senators Stephen Sweeney and Paul Sarlo, would create a system whereby businesses would see their UI taxes reduced if the fund runs a surplus. This would prevent a boon of cash from being created for wasteful spending, and would help alleviate the problem of businesses paying twice for the same employee benefit.

CIANJ supports it and will keep you posted as to its progress. 

Senate Passes Paid Leave 22-16

Minutes ago, the New Jersey Senate gave final approval to S-786, which would make New Jersey only the second state in the country with a paid leave mandate on virtually all employers. Some notes on the comments offered by members of the Senate.

• Senators Kevin O'Toole and Joe Kyrillos both mentioned the state's economic climate, and noted New Jersey lost 9,500 jobs during the month of January.
• Senator Ron Rice abstained, based on the increased payroll tax the bill would enact (about $33 per year) and the fact there is no exemption for small businesses, such as those with 10 or fewer employees.
• Senator Shirley Turner voted "NO" because of the negative effect the payroll tax increase would have on her constituents and NJ's already high cost of living.

The roll call vote is listed below.

	Adler, John H. - Yes	Allen, Diane B. - Not Voting	Baroni, Bill - Yes
	Bateman, Christopher - No	Beck, Jennifer - No	Bucco, Anthony R. - No
	Buono, Barbara - Yes	Cardinale, Gerald - No	Ciesla, Andrew R. - No
	Codey, Richard J. - Yes	Connors, Christopher J. - No	Cunningham, Sandra B. - Yes
	Gill, Nia H. - Yes	Girgenti, John A. - Yes	Gordon, Robert M. - Yes
	Haines, Philip E. - No	Kean, Sean T. - No	Kean, Thomas H., Jr. - No
	Kyrillos, Joseph M., Jr. - No	Lance, Leonard - No	Lesniak, Raymond J. - Yes
	Madden, Fred H., Jr. - Yes	O'Toole, Kevin J. - No	Oroho, Steven V. - No
	Pennacchio, Joseph - No	Redd, Dana - Yes	Rice, Ronald L. - Not Voting
	Ruiz, M. Teresa - Yes	Sacco, Nicholas J. - Yes	Sarlo, Paul A. - Yes
	Scutari, Nicholas P. - Yes	Singer, Robert W. - No	Smith, Bob - Yes
	Stack, Brian P. - Yes	Sweeney, Stephen M. - Yes	Turner, Shirley K. - No
	Van Drew, Jeff - Yes	Vitale, Joseph F. - Yes	Weinberg, Loretta - Yes
	Whelan, Jim - Yes