NJ Business Matters: The Blog of the CIANJ

Red Jersey

The Star-Ledger is reporting that the Economic Development Authority has agreed to have New Jersey take on an additional $150 million in debt to fund special needs housing.

The new loan will be repaid by motor vehicle fines paid by scofflaw drivers over the next 31 years.

It is the final installment of a $200 million plan lawmakers approved in 2005 to borrow against future motor vehicle fine revenues to develop apartments, condominiums and houses for individuals with special needs....

Besides raising $150 million in new funds, the state plans to issue another $425 million in bonds to refinance portions of an earlier set of motor vehicle revenue bonds that were issued to balance the state budget three years ago.

Signed. Sealed. Delivered.

Earlier today, Governor Corzine signed into law the FY 2008 New Jersey budget, with promised vetoes for appropriations the administration saw as unnecessary.

The Governor also outlined eight principles for asset monetization,

1. New Jersey’s roadways will not be sold; and they will not be leased to a for-profit or foreign operator.
2. Allowable uses of proceeds (reducing State debt and capital investments) will be identified upfront and subject to public and/or legislative approval with safeguards against diversions for other uses.
3. New Jersey citizens will retain ownership and the benefits from both initial proceeds and ongoing operations.
4. Safety, maintenance and operating standards will be provided at current or improved levels.
5. Sufficient funding to meet the long-term capital needs required to improve our roadways and reduce congestion will be provided.
6. Terms and conditions of employment for current employees and contractors will remain unchanged with prevailing wage and competitive contracting procedures retained.
7. Toll schedules will be open, predictable and available to the public.
8. There will be a substantial, open and public discussion in advance of any transaction. I will hold 21 town hall meetings in 21 counties.

The Governor's complete statement from today's signing is available on PoliticsNj.com

Snip Tuck

Governor Corzine is vowing to veto "quite a number" of state spending projects (or if you prefer, "Christmas tree" grants) before he signs the FY08 budget into law on Thursday.

NJ.com quotes the Governor as saying,

"I've been very clear that legislative earmarks to individual districts are not something we are in favor of," Corzine said in an interview on WNYC this morning. "You will see quite a number of line items that are cut back quite a bit. ... We will be very aggressive in looking at some of those additions."

That might make lawsuits like the one possibly being brought by the Center for Constitutionality avoidable.

Last year, the Center brought a suit against the governor over the same grants. The contention was that the distribution of funds violated a Constitutional separation of powers. After the suit was filed, the Governor impounded $25 million of the remaining $128 in pork and the suit was dropped.

Today's Record highlights the founder of the same organization and the possibility of yet another suit over the fact similar groups are being treated differently by the government through these grants. Click here for the entire article. 

Today in Trenton: Budget Public Hearings and Committee Votes

This morning, the Assembly Budget Committee will hold hearings on changes to the FY08 New Jersey Budget. A summary of those changes is available here.

CIANJ's position on the budget remains largely unchanged from the message delivered earlier this year. We continue to praise the legislature for passage of a budget that includes no new taxes or broad-based tax increases. New Jersey will come in line with tax policies in almost all other states when the double-taxation of S-Corporations expires. This change will assist more than 100,000 small businesses throughout the state.

However, the budget still does not fully correct the legislature's spending habits. It relies on one-time surplus money, takes funds from the Temporary Disability Insurance fund and subsidizes unnecessary spending at the local level - and there is still no new school funding formula in place. That message will be communicated to the legislature later today.

See for Yourself

As part of this year's budget process, the legislature is now posting all budget requests on-line as well as a more detailed look at the legislature's proposed changes to the Governor's budget. We will be testifying (eloquently I'm sure) on the changes next week. In the interim, click here to view the requested changes of all legislators and here to review the changes made from the Governor's original budget.

Star-Ledger coverage here.

Budget Deal Struck - Details to Follow

Governor Corzine, Senate President Codey and Speaker Roberts agreed to a budget deal yesterday, weeks in advance of the July 1 Constitutional deadline. We expect more details to be released today, but there are a few points already worth highlighting.

• Total spending will increase be $200 million over the Governor's proposed budget. That represents an increase of more than 7% above last year's spending.
• $776 million will be spent on charity care, which are funds given to hospitals to cover a portion of the cost of caring for New Jersey's uninsured.
• $15 million in special legislative grants.

Watch the blog and the CIANJ website later today and tomorrow for a reaction to the budget's finer points. Daily Record coverage here.