As most expected, Governor Chris Christie did not sign a bill which would have increased the state's minimum wage from $7.25 an hour to $8.50 and would've tied future increases to the rate of inflation every year. Instead, Christie conditionally vetoed the bill and offered what he calls a responsible compromise.

NJ Democrats

Christie's conditional veto seeks to reduce the size of the minimum wage increase by $0.25 to $8.25 per hour, introduce a 3-year phase-in, and eliminate altogether the provision for annual cost of living adjustments in future years.

"In these difficult times those most impacted by challenging economic conditions - our state's working families - need assistance," says Christie. "Instead of the lopsided approach taken by the Legislature, this plan delivers a responsible, balanced approach that increases the minimum wage by one dollar over a phase-in period of three years, while helping our working families with direct relief through an increase in our state's Earned Income Tax Credit."

"We expected it, but we're disappointed," says Assembly Speaker Sheila Oliver. "It would take people who earn the minimum wage three years to earn a dollar increase in their pay. That is unacceptable given the realities of the cost of living in New Jersey."

The Governor's proposal includes a full restoration of the New Jersey Earned Income Tax Credit, first proposed over a year ago in his January 2012 State of the State Address. At 25 percent of the federal tax credit, the state EITC will be increased from the current level of 20 percent of the federal benefit and be fully implemented in taxable year 2014, providing a $550 benefit to the average eligible beneficiary - struggling working families who most need the help.

Oliver says, "We do not believe that the minimum wage should be held hostage with a sweetener of the Earned Income Tax Credit. The Governor Needs to restore the Earned Income Tax Credit regardless of a conversation about minimum wage."

The speaker says Democrats will now move to their back-up plan. She explains, "We will have this issue on the ballot in November. Senator (Steve) Sweeney and I have agreed that we will, during the month of February vote a second time to put the question on the ballot."

The ballot question would ask voters if they'd like to hike the minimum wage by one dollar immediately and tie annual increases to the CPI.

Assembly Republican Leader Jon Bramnick applauds Christie's conditional veto. He says, "It's a compromise and I think all along he said he was willing to talk, but he did not want an increase tied into an index. As he normally does, he does something that's reasonable, in the middle and fair. The Democrats probably don't like it because they just want to put this on the ballot for a political football."

"There is no excuse for Governor Christie to use his veto power to weaken legislation aimed at boosting the earnings of New Jersey's lowest-paid workers, particularly with wages still stagnant at this point in the post-recession recovery," says Christine Owens, executive director of the National Employment Law Project. "By striking out indexing, Governor Christie is allowing the real value of New Jersey's minimum wage to simply erode each year as the cost of living continues to rise."

State Senate Republican Leader Tom Kean says, "The Governor has rightly rejected a partisan bill to set New Jersey's minimum wage on auto pilot regardless of the economic circumstances or needs of job creators. The recommendations for changes made in his veto statement are the reasonable and responsible way to increase the minimum wage without telling New Jersey's business community to, in effect, drop dead."

"His action shows that he believes politics and politicians need to remain part of the process on minimum wage," says Sweeney. "I think they need to be removed from it entirely. The well-being of working people in this state should not be left to the whims of politicians to decide on every couple of years."

Assembly Democratic Leader Lou Greenwald thinks, "The Governor has essentially told working class families that they're on their own. Families struggling to get by on a minimum wage salary have not seen a legitimate increase in more than six years. Phasing in a dollar increase over the next three years essentially forces them to wait nearly a decade for an increase that will lag well behind the cost of living increases by that time."

"The Governor conditionally vetoed legislation that would have dramatically impacted our members, especially small businesses," says Debra DiLorenzo, president & CEO, Chamber of Commerce Southern New Jersey. "The changes the Governor made are proof that he listened to the concerns of the business community, while balancing the needs of lower income workers. A phased-in increase in the minimum wage will allow businesses to better plan and budget for salaries, benefits and other wage-related costs. We will continue to oppose legislative efforts amending the State Constitution to include a labor contract which squarely belongs between employers and employees."

New Jersey Working Families Alliance Executive Director Bill Holland says, "The Governor's counter-proposal of $1.00 over three years is too little and too late for those who need a raise now, and it would do nothing to make sure the minimum wage keeps pace with the rising cost of living."