Video and Transcript: Governor Christie Approves a Constitutionally Balanced Budget for FY2012

Transcript of the Governor Christie’s Opening Statement at the FY2012 Budget Press Conference on Thursday, June 30, 2011

Governor Chris Christie:

Good Afternoon. For the second year in a row, I proposed a constitutionally balanced budget that reduced spending, didn’t raise taxes and protected critical priorities for the people of New Jersey. It continued a marked departure from years past when establishment Trenton perpetuated irresponsible, autopilot spending that created a massive structural deficit and was ignorant to the devastating fiscal impact it was having on New Jersey’s economic health.

The reality was that Trenton’s spend at any cost mentality had allowed huge increases in state spending over the last eight years while recurring revenues continued to decline – leading to a gigantic structural budget deficit. I was sent here in January of 2010 by the voters, in part, to solve this huge spending and debt problem.

The budget gaps I had to close for Fiscal Year 2010 and Fiscal Year 2011 totaled $13 billion. This action, combined with the adoption of landmark bipartisan legislation to reform interest arbitration, impose a two percent cap on local property tax increases, and reform the public employee pension and health benefits system, has meant real progress towards lasting fiscal discipline.

This year, unfortunately, the Democratic Legislature decided it was time to go back to the future. To revert to more of the same unrealistic, fantasy budgeting that has plagued Trenton for years and is the reason New Jersey got into fiscal trouble in the first place. They have decided to deceive the citizens of this state with a budget that makes them look like Santa Claus in an election year. How shocking—politicians deceiving and pandering to voters to get re-elected. I was sent here to end this politics as usual.

Their unconstitutional budget – and let me repeat, unconstitutional budget - if signed in its current form, would step on the hard won progress made over the last year and a half to right New Jersey’s fiscal course over the long term and instead embraces Trenton’s previous addiction to spending.

In keeping with my commitment to approve a budget that does not break faith with New Jerseyans and a promise to reform, I have aggressively used the line-item veto and the absolute veto on this budget and accompanying bills to ensure that the state will go into the next fiscal year with a constitutionally balanced budget, without raising taxes on any New Jerseyans and still protecting critical priorities.

My budget is constitutionally balanced, putting New Jersey on stronger fiscal footing while still funding key commitments:

  • My budget spends $29.7 billion, $900 million less than the Democratic budget, $1.3 billion less than all the spending the Democrats approved and maintains a healthy and necessary surplus;
  • My budget increases state aid to school districts by $850 million over last year. This means we have restored every dollar of the cuts we made last year AND increased it by an additional $30 million. I told the people of New Jersey last year that I made the cuts to K-12 education funding as a last resort. The very next year we restored every dollar of that funding and in fact increased it. We are keeping faith with our commitment to New Jersey’s children and families;
  • My budget doubles the Homestead Benefit to provide property tax relief for New Jersey families;
  • My budget increases and secures funding for New Jersey hospitals by an additional $20 million;
  • My budget provides full funding for women’s healthcare by increasing our commitment to those with low incomes and the uninsured through Federally Qualified Health Centers in every county in New Jersey. We are keeping faith with women in need of health care;
  • My budget provides $180 million in targeted tax cuts and incentives to grow the economy and create private sector jobs;
  • My budget flatly refuses to raise taxes on individuals and small businesses at a time when New Jerseyans are already subject to the third highest state income tax rates in the nation. Now, the Democrats will criticize us for not raising taxes, but they had their chance at the helm of our economy for eight years, all by themselves. What did they do? They raised taxes and fees 115 times, increased spending exponentially and created unemployment over 10%, worse than any of our neighboring states. Remember this: the tax they passed and I have vetoed – 71 percent of the returns under that tax related to small business income, 71 percent of the returns related to small business income. This is a small business job-killing tax by people who just can’t help themselves. And speaking of neighboring states, if I were to agree to the Democrat tax increase at the same time that Governor Cuomo of New York is cutting income taxes on New Yorkers, we would be at an even greater economic disadvantage, with New Jersey income tax rates nearly 4 points higher than New York and nearly 8 points higher than Pennsylvania. That will kill job growth in New Jersey and keep New Jerseyans out of work in record numbers. That is what the Democrats brought you for eight years. That is what you sent me here to change. I will not give in to the Democrats’ tax and spend agenda, no matter how many times they and their allies in special interest demagogue me for refusing to do so;
  • My budget fulfills New Jersey’s commitment to make the state’s pension fund payment, keeping faith with our public employees in a way that governors of both parties have failed to do over the last two decades; and finally
  • My budget protects our seniors by funding critical spending for prescription drug aid for our seniors and the disabled.

Remember, despite all the rhetoric you have heard and will hear, this budget is not only constitutionally balanced, but represents a commitment to the education of our children. As I said, this year’s budget increases education spending by nearly $850 million over last year, not only restoring all of last year’s cut, but increasing funding and importantly doing so with real revenue, not fantasy revenue supposedly found between the cushions of the couches down at OLS.

New Jersey continues to spend more money per pupil than any other state and now is the time to complement the dollars spent with real education reform. As I outlined in my State of the State address, the next big thing to tackle is education reform.

In contrast, the budget that passed out of the Democratic Senate and Assembly is a reckless and irresponsible homage to the past, putting election year politics ahead of reform and ahead of the taxpayers’ best interests. Their unbalanced, unconstitutional budget relied on phantom revenues, a penchant for political giveaways, unchecked spending and an unconstitutional approach that we will not go back to.

They are back to the tired old playbook that does nothing but threaten the state’s long-term fiscal integrity and denigrate the hard choices that we made together to shrink the structural deficit.

The Democratic budget in Trenton is history repeating itself; it embraces irresponsible spending and ignores the reality that all New Jerseyans seem to understand except for legislative Democrats—we are still in economic distress, government still spends and taxes too much and the people of the state need relief from the huge tax burden the Democrats thrust upon them in the first decade of this century. So, let’s look at their budget.

  • Their budget overestimates the revenue available by $365 million by simply ignoring my revenue certification;
  • Their budget fabricates out of thin air an additional surplus in Fiscal Year 2011 of $190 million without identifying a single overfunded account. Simply put, they just made it up so they could spend it. You can’t do that in your house and I will not allow it to happen in the State House;
  • Their budget ignores the shortfall of $165 million caused by the phase in of and other modifications to the pension and benefits reform proposal that I put out last September. That makes it improper and failing to fund the budget with enough money to support the cost for employee benefits. The result of their plan would be that our employee health benefit plan would run out of money in mid-year, preventing hard working employees from receiving health care. This is simply an outrageous Ponzi scheme to play with the life and health of our public employees and I will not let the Democrats in the Legislature put being Santa Claus to their special interests ahead of the health care of our public employees;
  • Their budget claims to restore the senior freeze program but does not fully fund it. That’s a neat trick. It creates a deficit of $30 million in that program, thereby denying our seniors the full funding to live up to the promise that they themselves are making. We need to tell our seniors the truth, not deceive them with promises in the hope to get their votes in November;
  • The Democrats hid $412 million in additional education aid in an unconstitutional bill outside of the Annual Appropriations Act. I confronted a member of the Legislature about the fact that this was clearly unconstitutional and that member said, “Yeah, we know.” This is the type of cynical and deceptive politics of the past in Trenton and I will not let it creep back in, no matter what worthy program they are pretending to fund;
  • Their budget penalizes towns that are budgeting within their means and providing exemplary services by eliminating opportunities for us to reward those towns with additional funding to incentivize best practices to eliminate fraud, waste and abuse;
  • On the other hand, in what is an obvious backroom deal to reward their political machines, they hide in the bowels of the budget the elimination of oversight and accountability by defunding the watchdog program that ensures the proper spending of taxpayer dollars on the municipal level. This will allow waste, fraud, abuse and, shockingly, rampant political patronage. Seemingly, they do not care.

In sum, Trenton Democrats would rather allow New Jersey to drift back towards the edge of fiscal disaster by embracing the old way of doing things.

This is not the way forward, but a seismic reversal to Trenton’s unrepentant addiction to spending that I vowed to end when I became governor. It’s time we actually learn from past mistakes, instead of repeating them over and over again.

The good news for New Jersey taxpayers is that the constitution gives me the power of the line-item veto, the absolute veto and the support of all of our citizens to end this type of conduct. I will not allow all the hard work and tough decisions, made on the bipartisan basis over the last 18 months to be undone by last-minute political gamesmanship of the legislative majority.

Rather than returning to the old practice of skirting the difficult issues and embracing fiscal irresponsibility, I will continue to make the tough choices every day and set the foundation for reform that will lead to the long-term economic growth and fiscal health of our state. I do not do any of this with a sense of joy. I wish I could be Santa Claus sometimes too. But I know you sent me to Trenton to be the adult supervision in this building. To end the irresponsible spending, to put a stop to the never ending tax increases and to give you a chance to spend your money on your family, not on the pandering of every politician in this building. I will not be deterred on the mission you have given me to restore fiscal sanity to our state and economic growth to our families. The veto of today’s business as usual spending and taxing is another positive step on that long and challenging road.

Press Contact:
Michael Drewniak
Kevin Roberts

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