A Budget That New Jersey Actually Needs?

Has Gov. Jon Corzine actually seen the light and realized that the state can't afford the state workforce it has and will instead begin the process of trimming it?

Is this a budget I could actually approve of? Perhaps.

Jon Corzine on Tuesday will become the first New Jersey governor in a decade to propose a state budget that cuts total spending, when he presents a plan that has no new taxes or fees, shrinks the state payroll by as many as 5,000 jobs and eliminates three departments, according to three individuals familiar with the budget.

Having pledged to keep total state expenses below the current $33.5 billion, the governor also will propose slashing state aid to towns and cities by about $100 million, and "charity care" funding for hospitals by as much as $200 million, according to the individuals, who requested anonymity because Corzine's plan had not been made public yet.

And while administration officials have said aid to school districts defined by New Jersey's school funding formula will increase by $530 million, overall school funding will be about the same as last year because of other reductions, not yet disclosed.

In addition, the spending plan will eliminate rebates to about 152,000 homeowners. Administration and legislative officials said last week homestead rebates would be limited to families making no more than $150,000 instead of the current $250,000 limit. The nonpartisan Office of Legislative Services estimates that move will save more than $100 million.

Rebate amounts are expected to remain about the same. They averaged $1,051 for homeowners and $303 for renters last year.

This pretty much guarantees that the unions will oppose it. Municipalities are going to complain heavily since local aid will also get cut.

It also leaves open the question of how exactly the school funding can increase even if the budget remains flat. What else is getting cut?

Cutting the state workforce is an important step since each job cut actually has a compounded effect because of benefits paid to those workers years after they are no longer working for the state.

While the article says no tax hikes, look for proposals to be floated to increase the gas tax and a whole assortment of minor taxes and fees, including perhaps the real estate transfer taxes, and maybe the various sin taxes. Those will likely be floated by the Legislature in response to Corzine's plan in order to raise revenues to cover the funding lost for pet projects.

States love to increase sin taxes because they can raise revenue while not affecting the overwhelming majority of residents. Without significant opposition to raising those taxes, states can raise them without too much trouble.