Governor Christie And The Legislature: "Deal Or No Deal?"

Governor Christie has ordered the Senate and Assembly into session today, and he plans to address the joint legislature at 1:00 PM. Members who do not appear can be brought to the State House by law enforcement, but they can not be forced to vote or take other action.  

Christie seeks to burnish his national Republican credentials. He would probably like to be the keynote speaker at the Republican convention, and he might still harbor a desire to be the Republican Vice Presidential candidate. However, he is becoming increasingly embattled. He is hampered by recent revelations regarding his ties to Community Education Centers (CEC) and his failure despite numerous warnings to remedy problems at the halfway houses. The strain seems to be showing in his increasingly intemperate comments: calling a reporter an "idiot," Senator Paul Sarlo "an arrogant SOB," and OLS Budget Director "the Dr. Kervorkian of numbers."

Nowhere was he more angry than in Brick last week when he shouted that lawmakers should, "Get the hell off the beach and back to Trenton and deliver my tax cut, right now." He desperately wants his tax cut and he wants it now. This afternoon he will probably offer a sweetener to convince legislators to enact the cut immediately, as opposed to waiting until later in the year when we will have a better fix on incoming tax revenues.  

The reality is that any tax cut would not take effect until January 1, 2013, so waiting a few months makes sense. Also Mark Magyar points out in today's NJ Spotlight that Christie's reliance on one-shot, non-recurring revenue in our new budget combined with increased costs for pension, debt service, transportation and business tax cuts will start off the next budget year with $1.9 billion in the hole which will already exceed all of that years' expected revenue growth. He goes on to say,

"The addition of a multiyear income tax or property tax cut at the level proposed by Christie would take $183 million out of the current surplus, would cost $575 million in revenue in Fiscal Year 2014, and would most likely create a major budget crisis just 4 1/2 months before the governor and all 120 members of the Legislature are up for reelection in November 2013.

The legislature is wise in exercising caution. Although we don't yet know what "deal" the governor might offer, it appears the legislature's best response would be "No deal."

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