NJ on verge of government shutdown over July 4 weekend

TRENTON — Gov. Chris Christie said Thursday that he won't sign a state budget unless it's presented to him along with his proposal to overhaul the state's largest health insurer and a plan to dedicate lottery revenue to the state's underfunded public workers' pensions.

The Democratic-controlled Assembly's failure to pass a $34.7 billion state budget on the first try Thursday threw the process into confusion with the prospects of a state government shutdown looming if Christie doesn't sign a budget by Friday night.

Christie said that it's up to Democratic Assembly Speaker Vincent Prieto to get a deal done and that it's time for him to "stop obstructing."

Prieto stopped voting on the budget Thursday after it apparently didn't have enough support.

The Democrat-led state Senate is behind a version of Christie's proposal, but Prieto insisted that he will not bring it up for a vote this week. He promised to hold another vote on the budget measure, while the state Senate said that it will not hold a budget vote on Thursday.

Along with using revenue from the state lottery to pay down the state's underfunded public workers pension fund, the deal to use part of Horizon Blue Cross and Blue Shield's $2 billion surplus for drug addiction treatment is seen as key to Christie signing off on a budget that funds Democratic priorities. Those priorities include more than $150 million for education.

Failure to enact a budget would lead to a government shutdown, affecting state parks and other nonessential services such as motor vehicle agencies.

Christie on the budget on Monday. Story continues below video:

Prieto said if there's a shutdown blame lies at the feet of the lawmakers who opposed the budget, which was negotiated with the Senate and passed out of committee with Democratic support.

Prieto had only 24 votes of the 52-member Democratic caucus, with 41 votes needed to pass anything in the Assembly.

Prieto said he negotiated in good faith and included legislation backed by Christie to transfer the lottery to the public pension. But he would not agree to the Horizon legislation, calling it a "bad bill" that could hurt the insurers' 3.8 million ratepayers.

Democratic Assemblyman Craig Coughlin, who has announced that he is seeking to challenge Prieto as speaker, was among the Democrats who failed to register a vote on Thursday. He told The Associated Press that he did not record a vote because he wants "certainty that the benefits that were in that budget for the people of New Jersey would be preserved and achieved."

Democratic state senator and budget committee chairman Paul Sarlo said that any Democrat who votes for the budget without the Horizon deal needs to be OK with Christie using his line item veto to ax millions of dollars for Democratic priorities.

"We don't want to cast a vote on a budget that he redlines everything out," Sarlo said. "We have a balanced budget with no new taxes, solid revenue projections and good strong legislative priorities."

In 2006, when the government shut down under Democratic Gov. Jon Corzine, road construction projects were required to wind down. Motor vehicle offices shuttered, and about 45,000 state employees were furloughed. State courts were closed for anything but emergencies.

State-run parks, beaches and historic sites remained open through the July Fourth holiday but closed afterward.

Christie on Monday — Article continues below video

Horizon has strongly fought back against the Christie proposal with an onslaught of lobbying. The nonprofit says using the surplus would lead to higher rates for its members.

The Senate approved a different version of Christie's proposal. Rather than tapping directly into Horizon's surplus, it requires that Horizon set a range for its surplus. When the top limit is exceeded, then the excess cash would go toward programs to benefit the public and policyholders under the Senate bill.

Christie hasn't specifically backed the plan but called it a good start. The bill was voted on Monday after being introduced June 23.

Should state parks, including the popular Island Beach State Park, be closed over the holiday weekend, beachgoers would still have plenty of options at local municipal beaches up and down the state's 127-mile coastline. The same holds true for municipal and county-run parks, which would still be open and unaffected by a state shutdown.