New Jersey Politicians Salivate Over Tax Amnesty Windfall

The New Jersey Division of Taxation took in a massive windfall from the recently concluded amnesty program.

Some reports suggest that the amnesty took in $400 million, while others suggest it was $550 million. The state had hoped it would take in $200 million.

Politicians are salivating on how to spend the money. Democrats and Republicans alike.

Gov. Jon Corzine and Democratic leaders agree that the unanticipated revenue should go toward property tax relief. But others may want to divert a portion of the money for pet projects or to programs cut because of the recession.

GOP Sen. Sean Kean (keen) of Wall wants funding restored for the arts, beach replenishment and Emergency Medical Technician training.

Sen. President Richard Codey, D-West Orange, says taxpayers — not lawmakers or special-interest lobbyists — will benefit from the extra money.

It isn't their money to spend. But they'll go ahead and spend it anyways.

Here's what the money should go towards. It should go towards the severely underfunded pension funds, preventing further destabilizing structural deficits going forward, and to the transportation trust fund so that construction on various projects around the state can proceed.

In exchange for the pension funding, the state should extract more concessions from the unions on pension benefits going forward, moving towards phasing out pensions altogether.

It would be the fiscally responsible thing to do, but that's precisely why it wouldn't be considered.

Funding the transportation trust fund would be a prudent step, and enable projects to go forward around the state in a timely fashion, and would help get local construction businesses going.

As to the discrepancies between the numbers, it's par for the course. It depends on how you count the money - including or excluding the $200 million that the amnesty was originally expected to bring in along with rounding up or down.