New Jersey stares at worsening budget deficit

AP News
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Posted: Nov 27, 2009 4:00 PM

New Jersey is about to wield a budget ax again on programs and services as tax revenues continue to take a beating.

Gov. Jon Corzine expects department heads to identify $400 million in spending cuts by Tuesday.

Information disclosed to potential investors this week shows the governor also may be planning to freeze or reduce up to $400 million in payments to schools, towns, colleges, hospitals and the pension fund.

A deepening revenue shortfall and additional appropriations have combined to create a deficit projected at $1 billion.

Tax collections for the first four months of the fiscal year were about $410 million lower than expected.

A recent Pew Center on the States report has identified New Jersey as one of nine states whose fiscal problems are as dire as those in California.