Business groups push plan to keep NJ from ‘going over the cliff’
Business groups are organizing a new advisory council to help advocate for its new “Plan for an Affordable New Jersey” – a conglomeration of its own ideas, a modified version of Gov. Phil Murphy’s economic plan and some of the government overhauls advocated by Senate President Steve Sweeney.
The council and agenda are the next steps for Opportunity New Jersey, a coalition founded in 2016 that primarily includes business organizations and trade associations.
Tom Bracken, president and chief executive officer of the New Jersey Chamber of Commerce, said “there’s a sense of urgency” that the recommended changes need to be made soon.
“The plan is very practical. All the elements are quite doable,” Bracken said. “And with a coordinated effort among the administration, the legislative leaders and the business community, it can produce early and continuing very positive results.”
Michele Siekerka, president and chief executive officer of the New Jersey Business and Industry Association, said New Jersey is at the brink of a fiscal cliff, which is why the plan calls for reforming public workers’ health benefits, dedicating the savings to the pension funds and changing retirement plans for future government workers.
“We made promises to them. We have to keep them,” Siekerka said. “We’re being derelict if we don’t do something to ensure that the future government workers can be protected as well. And that’s what requires change today. This is not sustainable, but there are solutions to make it sustainable.”
“I’m not sure if we’ve gone over the cliff or if we will even know when we go over the cliff,” Bracken said. “But the point is, I think, if we get to that point, then we cannot turn this economy around and we will know then that we have gone beyond the point of no return. What we’re trying to do is to avoid getting to that point.”
The plan also calls for consolidation of school districts, further changes to the school funding formula and the creation of ‘public private partnerships’ for both schools and infrastructure development.
“In the state of New Jersey right now, every new dollar we’re bringing in, it’s like opening the window with the air conditioning on. We’re watching it flow right out,” Siekerka said. "So we need to get hold of these outdated systems. We need to reform them so that every new dollar in our budget goes right to the bottom line.”
The plan calls for a moratorium of any new taxes, fees or government actions that affect businesses for two years; a freeze on new government spending until current programs are fully funded; reforms of the state’s capital gains tax; and a plan to suspend minimum-wage increases if a recession hits.
Siekerka said the economy is good currently – the state labor department reported Thursday that the unemployment rate reached an all-time low, 3.5% – but that “we’re staring down the potential of a recession” within the next year and a half, or so.
“If we can’t get this done in a good economy, right now, what’s going to happen when we’re not in a good economy?” Siekerka said. “It’s going to be even more challenging to address these issues then. That’s why the sense of urgency today.”
The plan incorporates some of the economic plans Murphy has been advocating since last year, such as focused incentive programs and an Innovation Evergreen Fund that stimulates capital investment. But it also says there should not be caps on incentive programs, as the governor is seeking.
Sweeney isn’t a fan of Murphy’s economic plan. Murphy doesn’t support key elements of Sweeney’s so-called “Path to Progress” overhaul of government. The business-backed plan takes in elements of both.
“Our job is to be a purveyor of information to them that’s grassroots information. We’re not going to mediate anything. That’s not our job,” Bracken said. “We just want to be the conduit for them to get information that they would otherwise not be able to get.”