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     Just The Aunt Supporter Username: Auntof13 Post Number: 5549 Registered: 1-2004  |
New Jersey Government Shuts Down Over Tax Dispute Governor Signs Closure Order; Lottery, Road Crews to Be Affected First By TOM HESTER Jr, AP TRENTON, N.J. (July 1) - Gov. Jon S. Corzine closed the state government Saturday amid a bitter dispute with fellow Democrats in the Assembly over his plan to increase the sales tax, moving to close beaches, parks and possibly casinos in the coming days. The dispute centers on Gov. Corzine's determination to raise the state sales tax from 6 percent to 7 percent to help close the budget deficit. After Saturday's constitutional deadline to adopt a new balanced budget passed without agreement, Corzine signed an executive order just after 9:30 a.m., a grim climax to weeks of budget squabbling among Democrats who control state government but haven't been able to agree on a budget bill. "It gives me no joy, no satisfaction, no sense of empowerment to do what I'm forced to do here," Corzine said. No formal negotiations were scheduled for Saturday, but Assembly lawmakers are expected to return to the capital city for budget deliberations on Sunday morning. Within minutes of Corzine signing the order, road construction projects were required to begin winding down. Motor vehicle offices were to close at noon. About 45,000 state employees were immediately furloughed. State courts were closed for anything but emergencies. State parks, beaches and historic sites were expected to slowly close in the coming days, with all closed by Wednesday. Beaches were staying open through the July Fourth holiday, preventing a more dramatic effect on New Jerseyans' plans for the long weekend. All horse racing in the state was expected to conclude at 6 p.m. The order allows Corzine to keep 36,000 state employees working without pay. That will keep the state's prisons, veterans homes and psychiatric hospitals open. Child welfare, state property protection, transportation and environmental safety functions will also continue. Atlantic City's 12 casinos could be forced to close because they require state monitoring, though the casino industry is challenging that in court. July welfare checks have already been mailed, said Corzine's chief counsel, Stuart Rabner. But he said next month's cannot be sent unless a budget agreement is reached. The dispute centers on Corzine's determination to raise the state sales tax from 6 percent to 7 percent to help close a $4.5 billion budget deficit. Corzine sees the increase as a vital step toward providing reliable annual revenue, but most Democrats in the Assembly - the lower house of the state Legislature - and several Senate Democrats say the plan is unnecessary. Led by Assembly Speaker Joseph Roberts Jr., D-Camden, they offered $741 million in spending cuts and $917 million in other tax hikes to avoid a sales tax increase, but Corzine rejected many of their ideas. Opponents have questioned the need for a sales tax increase, predicting voter backlash and demanding that any increase be reserved for property tax reform. Corzine complained that budget efforts "have not resulted in the sort of responsible plan the public has a right to expect." But as the closures took effect, Roberts said Assembly Democrats remained steadfast in their opposition. "We've been working mightily to convince Gov. Corzine that there are clear, legitimate alternatives to raising the sales tax," Roberts said. "I'm disappointed that he so far has been unwilling to embrace those solutions." Corzine accepted opponents' proposals for increased corporate taxes, increased tax revenue estimates. He killed hospital bed, alcohol and water taxes they opposed. Corzine also accepted a compromise offered by Senate President Richard J. Codey to use half the money earned by a sales tax increase for property tax relief. Attending an inaugural party for the Trenton mayor Saturday afternoon, Corzine called the impasse rergrettable. "As this unfolds there will be increasing implications for real people, and that's not desirable at all. It's important for people to understand that you have to compromise. There's a good compromise on the table presented by Sen. Codey. I'd love to use that as a framework." Roberts, though, questioned the need for any sales tax increase. Roberts said he hoped to talk with Corzine at some point, noting the shutdown posed an "enormous burden for millions of New Jerseyans." He called the Assembly Budget Committee back to the Statehouse for a 10 a.m. Sunday meeting to craft a budget plan. "Committee members should expect to work Sunday through Monday so we can bring a satisfactory end to this crisis," Roberts said. Codey spokeswoman Jennifer Sciortino said Codey has ordered senators to the capital city for a noon Monday session that won't end until the crisis is resolved. Corzine said he has talked to Assembly members outside of leadership, but wasn't counting votes. He emphasized the Legislature has given him nothing to sign. "The governor has to have something to act upon before I can act," Corzine said. The state constitution requires a balanced budget by July 1, but the deadline has been missed four times in five years. Nothing happened when deadlines were missed before because the state never went past the morning of July 2 without an adopted budget. Without one, the state has no authority to spend money. Corzine said the lack of any imminent agreement gave him no alternative. Rabner said the administration will monitor the closures and adjust as needed. "We will continue to re-evaluate," he said. Republicans, the minority party in both the Assembly and Senate, expressed frustration. "I'm appalled that this reached this stage," said Senate Minority Leader Leonard Lance, R-Hunterdon. "It is very unfortunate that the Democratic governor and Democratic majorities in the Legislature could not achieve a budget in place by June 30, and now all the people of New Jersey suffer as a result." | ||
| Nob Citizen Username: Nob Post Number: 268 Registered: 4-2004 |
I can see shutting down operations that cost money (unless you are just retroactively going to pay people anyway as has always been done in the past, in which case they might as well work) BUT shutting down revenue sources like the lottery, that's just stupid! Thought Corzine has a business background and would understand this sort of "fine" point. | ||
| Albatross Citizen Username: Albatross Post Number: 878 Registered: 9-2004  |
The lottery isn't pure profit; the state has to spend money to operate the lottery. The state has no authority to spend money because there's no budget, ergo it can't run the lottery. | ||
| daylaborer Citizen Username: Upondaroof  Post Number: 779 Registered: 4-2003  |
The state had no authority to borrow money to balance the budget, but that didn't stop McGreevey. Shutting down is Corzine's version of "shock and awe" to get the sales tax bumped to 7%. | ||
| TomR Citizen Username: Tomr Post Number: 1178 Registered: 6-2001 |
With regard to the Lottery shut down, I can understand how it might grind to a halt if a budget is not adopted at some point, but can someone explain why vendors can't sell tickets which have already been printed and distributed? TomR | ||
| Joan Supporter Username: Joancrystal Post Number: 7716 Registered: 5-2001 |
The vendors can't sell tickets that have already been printed and distributed because winners still have to be selected, reveue accounted for, payments made, etc. At least loss of such things as lotteries and horse races isn't life threatening. What about attempts to help persons living in Trenton and other areas damaged so severely by the recent flood? Will the State be unable to send trained emergency workers and needed supplies or coordinate relief efforts because of moritorium on State spending? What will be the impact on critical services not covered in the press release JTA quoted? What happens next month if there is still an impass? At what point will semi-independent State supported services such as mass transit, aide to education and the State University system become impacted? These seem like much more serious questions. | ||
| gertie Citizen Username: Gertie Post Number: 3 Registered: 6-2006 |
People who work in state government mostly live in PA. Keep it shut down! Bravo, Mr Corzine! | ||
| Albatross Citizen Username: Albatross Post Number: 880 Registered: 9-2004 |
The other thing about the lottery is that stores that pay out winning tickets would expect to be paid back promptly by the state. I don't think that the order would prevent stores from selling the tickets that they had, though. The Maplewood Stationer's shop has a sign on the counter: no lottery payouts after July 1 due to state budget shutdown. | ||
| TomR Citizen Username: Tomr Post Number: 1180 Registered: 6-2001 |
I may have misunderstood the information made available. I thought all sales had been suspended. TomR. | ||
| Factvsfiction Citizen Username: Factvsfiction Post Number: 859 Registered: 4-2006 |
See what having a financial guy in office can do for NJ? Some of the usual lottery buyers that I saw looked like they were having bad withdrawal symptoms. Why not put a 5-10 cent tax on every ticket, sort of like the other "sin" taxes? | ||
| Nob Citizen Username: Nob Post Number: 270 Registered: 4-2004 |
Aren't lottery funds dedicated to support educational spending? If so, guess FvF's suggestion wouldn't solve the problem although not a bad idea. Also, I would think deeming enough staff to keep about $1.5 million daily flowing into the state coffers would be the definition of an "e$$ential" employee. Can the state afford to lose that kind of money? | ||
| Nob Citizen Username: Nob Post Number: 271 Registered: 4-2004 |
On the other hand who would notice if they weren't shutting revenue generating items and beaches? | ||
| bottomline Citizen Username: Bottomline Post Number: 451 Registered: 8-2003 |
Some public official once described the lottery itself as a stupidity tax. I'm inclined to agree, and don't see that we need an additional surcharge on it. In practice, it's actually a regressive tax because of the disproportional impact on lower income purchasers. | ||
| Rastro Citizen Username: Rastro Post Number: 3468 Registered: 5-2004  |
Nob, the problem with earmarking funds for education is that previously budgeted funds can then be used for something else. For example, let's say the school system needs $2 billion. Then the lottery commission comes around and says "We're going to give you $1 billion from lottery proceeds." Great. The state then says, great! Now we only need to budget $1 billion, and the other billion will come from the lottery. So essentially the billion that the lottery brings in goes to the general fund. | ||
| bottomline Citizen Username: Bottomline Post Number: 452 Registered: 8-2003 |
Rastro is correct: revenues are fungible. Associating the lottery with education, or some other popular cause, was used in most states as political ammunition to overcome conservative opposition to gambling. If you look at the New Jersey Lottery website, you will see that they "support" not just education but also veterans affairs and mental health services. The warm and fuzzy approach is definitely a good way to sell state-supported gambling. BTW, the net proceeds of the lottery provide about three percent of the state government’s total revenue here in Jersey. | ||
| kenney Citizen Username: Kenney Post Number: 793 Registered: 11-2003 |
Please, someone get to the bottom line and point out how this is Bush's fault. | ||
| SO Ref Citizen Username: So_refugee Post Number: 1949 Registered: 2-2005  |
Somebody prop kenney back up on his barstool... | ||
| Ender Citizen Username: Enderw Post Number: 49 Registered: 4-2006 |
This is classic, as noted above - Lottery, horseracing, casino are all REVENUE BLEEPING GENERATING ACTIVITIES. Why in God's name would they shut them down when they are in a financial crisis? Also - can anybody please verify that all the state workers are being forced to stay home BUT ARE STILL GETTING PAID? What is going on here? Even McGreevey would have bent over backward...errr forward...to keep the revenue generating activity going. | ||
| Rastro Citizen Username: Rastro Post Number: 3482 Registered: 5-2004 |
No, they are not getting paid. That's the whole friggin' point! | ||
| Aok Citizen Username: Aok Post Number: 255 Registered: 6-2005 |
Non essential employees are not getting paid ...at the moment.....but according to the newspaper all the legislature needs to do is pass a special bill to retroactively pay all employees (after the new budget deal of course). Historically the legislature has always done just that -- so state employees have a potential cash flow problem but highly unlikely they will lose any money in the end. I'd vote for the legislators and senators to be forced to forfeit their own pay doubled for however long the delay runs but wouldn't want to penalize the average worker. But if they are going to get paid anyway I think they should do their work -- guess it would be ok if they show up late since they'll be getting paid late. | ||
| kenney Citizen Username: Kenney Post Number: 794 Registered: 11-2003 |
Gambling and the lottery exploit the poor for the benefit of cowardly political officials who fear having to make priority spending decisions. As soon as they run this well dry, protistution and drugs are next. | ||
| Aok Citizen Username: Aok Post Number: 257 Registered: 6-2005 |
Kenney -- would that be to exploit or to close down? | ||
| Aok Citizen Username: Aok Post Number: 259 Registered: 6-2005 |
An extended suspension of the Lottery could prove costly. It collects an average of $6 million a day from customers and accounts for $800 million in state revenue annually, according to the Lottery's Web site. | ||
| kenney Citizen Username: Kenney Post Number: 795 Registered: 11-2003 |
I don't know if I would use 'exploit', but I have little doubt that once the politicians realize the extent of tax revenues and cost savings at play in decriminalizing personal behavior, they will begin the process of making many of these acts legal. | ||
| joel dranove Citizen Username: Jdranove Post Number: 643 Registered: 1-2006 |
It is just a cynical maneuver by Wall Street Man who bought a State. Let's hope the government stays closed for a month or more. Then we can determine what is needed, and not. Then we can furlough say, ten percent, or more of the "necessary" workers, to see what impact their absence causes. PA loses. We win. jd | ||
| Brett Weir Citizen Username: Brett_weir Post Number: 1670 Registered: 4-2004  |
This is what the Democratic Leaders got when they opted to save the campaign money on Dick Codey and let Jon Corzine "pay" his own way into office. The man is an autocrat and completely out of touch with the people he purports to champion. He also thinks he can run a government like a business and buck his own party leadership simply because he is Governor- wrong and wrong. Whatever else one can say about Codey, he is a consensus builder and a tireless negotiator. He would never make a grandstand play like this at the expense of people who need daily assistance from State agencies- the elderly, the disabled, the impoversished and others who can barely get by. The airwaves today were filled with such people whose access was pre-empted by "The Corzine Manuever". | ||
| Factvsfiction Citizen Username: Factvsfiction Post Number: 873 Registered: 4-2006 |
joel- But that would get Carla Katz pissed at Jon Corzine. If you remember Corzine said he would be an independent governor, even if his ex-girlfriend was on the other side. Wonder why Jon's big speech on the sales tax had only state (union) workers rallying?  Guess there is going to be REAL tough bargaining next year with the unions! | ||
| bottomline Citizen Username: Bottomline Post Number: 453 Registered: 8-2003 |
So, if Cody is so great, let him build a consensus in the legislature and put a balanced budget on the governor's desk. Wishful thinking won't balance the budget. McGreevy and Whitman both passed the buck; I for one am happy Corzine has drawn a line in the sand. | ||
| daylaborer Citizen Username: Upondaroof Post Number: 782 Registered: 4-2003 |
"Corzine has drawn a line in the sand." Bulls#$t! They are still collecting tolls, liquor, tobacco and gasoline taxes, not to mention sales tax! If he wants to draw a line, have him shut down those industries. He won't live 'til dawn! He's grandstanding. If he wants to run NJ like a business, then NJ should treat him like an employee. If the voters are the stockholders and they hire this guy based upon the fact that he's not going to raise taxes, but actually lower them and he can't produce, then what should happen? Yeah! He becomes a no governor job having bozo walking down the road! What's wrong with us? | ||
| Brett Weir Citizen Username: Brett_weir Post Number: 1672 Registered: 4-2004 |
Jon Corzine was a dilettante-turned-U.S. Senator who abandoned that post for Governor because it: a) Suited his autocratic style, and b) Better positions him for a White House run in 2012. He will grow bored with this job sooner than we will grow bored with him, and his inability to work with others will cost us in the end. | ||
| Dr. Winston O'Boogie Citizen Username: Casey Post Number: 2209 Registered: 8-2003  |
any of you aware of the trend on NJ's bond ratings? they've been going south for years, due to the budgetary chicanery of our previous 2 governors. I don't approve of 100% of what Corzine's doing, but it's time that somebody in Trenton rejected the farcical way of doing business there. I suppose a lot of you would rather have had Dougie Forrester's tax cuts, even if they were achieved with typical Trenton budgetary smoke & mirrors. it's already apparent that Corzine is going to get "Florioed" over this budget, and in 2009 we can vote in another governor who can play the old-time budget tricks and get us into an even deeper hole. voters say they want somone to be principled and stand up to "business as usual" in the state house. until someone actually does it, and then they start to think business as usual looks pretty good after all. | ||
| Hoops Citizen Username: Hoops Post Number: 1595 Registered: 10-2004  |
Let the assembly pass Corzines budget. Paying extra penny on the dollar that can be used to pull NJ out of the fiscal mess it is in may be just the thing we need. | ||
| Southerner Citizen Username: Southerner Post Number: 1223 Registered: 2-2004 |
I love this thread. Only a lib Governor could get away with hurting the poor and no one cares. And better yet, posters like Hoops, who loves to paint the picture of caring libs, like this move. This is hilarious especially coming from the state that believes it is so much smarter than the other 49. This shut down by a liberal Dem only hurts the working poor. The rich could care less if the state government ever reopens because they don't depend on them. The poor, at the height of the summer heat, are once again getting hosed by a liberal. If I didn't know this was true, I would think it was a spoof posted by Foj. | ||
| Factvsfiction Citizen Username: Factvsfiction Post Number: 883 Registered: 4-2006 |
O'Boogie- I seem to recall in another thread you rationalized that our increased taxes in NJ were a-ok because NJ residents have a higher income than average nationally, ignoring the fact that as less people and businesses move to the state, (due to these very same taxes)we will increasingly have to pay more than our share. I hate to break it to you but Corzine is not a profile in courage here, shutting down the government over the one cent raise, as that too is a temporary relief measure and bandaid. It's kind of laughable given he said during the campaign he would raise taxes as a last resort, and his budget also includes significant new spending. Corzine would love to do what he would have done if he was a corporate CEO namely massive job cutting, except the people whose jobs he would cut here are the people he needs to vote for him next time. (Yes, he is going to have to run for gov again given that he will be unlikely to be offered the dem v.p. spot in 2008 due to geographical reasons). His biggest mistake so far was in making his fellow dems in the Assembly look bad. He might be a smart CEO, but when it comes to politics these guys can have him for lunch. | ||
| Brett Weir Citizen Username: Brett_weir Post Number: 1675 Registered: 4-2004 |
FVF- My point exactly. Politics is a dirty business, but it is still the only game in town. Corzine is trying to score a first-round knockout on his own party's heavyweights; if he fails he'll have a long four years trying to mend fences. And Southerner is not wrong about who this shutdown impacts the hardest; it is the poor and disadvantaged who Corzine courted and counts among his supporters. | ||
| Dr. Winston O'Boogie Citizen Username: Casey Post Number: 2210 Registered: 8-2003 |
do we really need more people moving to NJ? and how does it follow logically that if fewer businesses move to NJ, we will end up paying more taxes? you could argue that if MORE businesses moved to the state, current residents would pay a smaller share of taxes, but the converse doesn't follow logically. frankly I don't know that a sales tax increase is going to solve all the budget problems, but I do know that state senate's plan looks like the same sort of gimmickry that got us into this mess in the first place. "massive" layoffs? even that won't do it alone. we've got 45,000 "non-essential" state employees. how many of them would have to go to close a $1 billion budget hole? | ||
| Chris Prenovost Citizen Username: Chris_prenovost Post Number: 974 Registered: 7-2003 |
Corzine shuts down the state government to gain passage of an increase in the sales tax. The sales tax is the most regressive tax available, which means it hits the poor much harder than it hits the rich. And this to pay a state bureaucracy that is very well paid, has excellent benefits, great pensions and job security. So, in essence, Corzine wants to tax the poor to feed the rich. And this is good, how. . . ? | ||
| Ily Citizen Username: Ily Post Number: 251 Registered: 7-2004  |
Increasing sales tax from 6% to 7% is a 16.7% tax increase. This one penny stuff seems misleading to me. I wouldn't be as against it if this increase expired, like in 2007, going back to 6%. It would give Corzine time to put things in order, eliminating government waste and corruption, like he promised. But it's so much easier to raise taxes. Ugh! Worst governor ever. | ||
| Spinal Tap Citizen Username: Spinaltap11 Post Number: 22 Registered: 5-2006  |
Here is a link to an interesting article detailing how NJ became the economic basket case that it is. Maybe this shut-down is long overdue. http://www.city-journal.org/html/16_2_new_jersey.html | ||
| joel dranove Citizen Username: Jdranove Post Number: 646 Registered: 1-2006 |
"paying an extra penny on the dollar" of tax is: a 16.66 percent raise in sales tax. See if anyone else, particularly in Trenton or the media spells it out like that. jd |
