Gov. Christie Proposes $34.4 Billion State Budget [VIDEO,AUDIO]
Gov. Chris Christie’s proposed Fiscal Year 2015 (FY 15) State Budget calls for spending $34.4 billion making the biggest budget ever for the Garden State. The governor said there is a reason for that. Mandated costs are driving up the budget while crowding out spending for other priorities.
“Even though this $34.4 billion budget represents an increase of 3.5 percent over what we spent last year, 94 percent of that increase, virtually all of it is taken up by three things: pensions, health benefits, and debt,” explained Christie in his State Budget Address. “Nine out of every 10 dollars of new spending this year goes to fund these three entitlements.”
Monday, Democratic leaders threatened to allow state government to shut down if Christie did not pledge to make the required payment into the public employee pension fund.
“The budget proposes making the largest pension payment ever at $2.25 billion,” Christie said. “This is an increase of almost $670 million from last year. This budget is faithful to the bipartisan pension legislation we enacted together.”
The spending plan does not include a tax cut not does it include a tax increase. Christie said raising taxes is not the solution to the state’s fiscal woes. He explained that more pension and health benefit reforms are needed because without them Jersey taxpayers still owe $52 billion to fully fund the pension system.
On the positive side of the ledger, the governor is proposing over $15 billion is education funding.
“The budget I put before you today provides the most funding in New Jersey history for education for a fourth year in a row.” Christie said. “We are committing more than $12.9 billion. We are providing a record-setting $9 billion in direct aid to schools, nearly $40 million more than the previous year.”
School aid will go up by $481 million under Christie’s plan. The $1.5 billion he proposed for municipal aid represents a $32 million increase year-over-year. The governor also called for $1.2 billion to fund property tax relief programs. Under the plan, $8.5 million would be used to reimburse local and county governments to share services and pass on the savings to taxpayers.
In order to raise roughly $205 million in new revenue, Christie said he wants to close five business tax loopholes, key among them a plan to require out-of-state online retailers active in New Jersey to collect and pay the state sales tax.
“As this budget clearly reflects, our choices in the future will not get easier,” Christie said. “We cannot be like some prior governors and legislatures and ignore the long-term implications of spending and taxing decisions. We need to understand the impact of our decisions and find a path to a better future.”