Christie set to reveal 2016 NJ budget plan

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Posted: Feb 22, 2015 11:00 AM
Christie set to reveal 2016 NJ budget plan

TRENTON, N.J. (AP) — New Jersey residents will get a glimpse of how Gov. Chris Christie wants to spend their tax dollars when he lays out his 2016 budget plans before a hostile Democratic-controlled Legislature next week.

Christie's sixth budget address comes as he jets across the country considering whether to seek the Republican presidential nomination and as New Jersey faces a transportation trust fund on the brink of insolvency coupled with a public pension system that continues to pile on debt.

In his address, Christie is expected to lay out how much he plans to pay into the public sector pension system, though it's not clear what that figure will be. Some 500,000 pensioners rely on state funds, which carry $37 billion in debt, according to the state treasurer's latest report. That figure is up about $3 billion year over year, an increase that comes after Christie cut back payments to the funds last year because state receipts fell below revenue projection — a move that angered Democrats and many pensioners.

Also at issue is the state's debt-laden, nearly $2 billion transportation trust fund, which will be insolvent by July 1. Residents could see the price of gas go up if proposals to raise the 14.5-cent fuel tax are enacted. It's an unpopular suggestion, but there's near universal agreement that the state's infrastructure is in desperate need of repairs and upgrades

The two issues have garnered national attention as New Jersey's finances come under scrutiny in advance of Christie's likely run. Christie's campaign flirtations appear to be off to a difficult start, with donors in New Jersey and nationally signing on would-be opponents, including former Florida Gov. Jeb Bush. The budget provides an opportunity for the governor to shift the conversation back to the state, and will be followed by a series of town hall meetings, kicking off Wednesday, aimed at selling his plans.

Still, there has been no clear agreement between Christie and Democrats about how to move forward on the public pension system or the trust fund. On the contrary, the hostility is spilling into the open.

As he offered a preview of his budget address during a speech in Washington Thursday evening, Christie rebuked Democrats in the Legislature for blocking his economic plan, proposing higher taxes and refusing to acknowledge what he called the state's unfriendly business climate. Democrats are equally frustrated with Christie, who regularly take shots at his potential White House ambitions and criticize him for spending too much time out of state.

If there is going to be compromise on the trust fund or the public pension system, it doesn't appear to be close at hand. Democrats say the governor has not shared any of his budget plans with them.

"The silence has been deafening," said Assembly Budget Committee Chairman Gary Schaer.

The address comes after the state Chamber of Commerce's annual "Walk to Washington," an annual networking event that attracted some 900 lobbyists, business owners and lawmakers— including Christie, Assembly Speaker Vincent Prieto and Senate President Steve Sweeney. The transportation trust fund was often at the center of conversation, but pessimism seemed to rule the day.

"I hope we hear something that's not clouded by rose-colored glasses," said state Senate majority leader Loretta Weinberg. "The fact that we haven't heard anything is sad."

Some are beginning to suggest that without a deal to raise revenues for the fund, the administration could restructure debt to pay for infrastructure in the near term, said Hope Township Mayor Tim McDonough, who chairs a panel on transportation for a state interest group for municipalities.

It's no one's preferred method, but might be how the governor and lawmakers resolve the issue — for now, suggested David Hartgen, University of North Carolina-Charlotte transportation professor emeritus.

The problem with the trust fund stretches across Democratic and Republican governors and stems from officials' reliance on debt. The fund has nearly $16 billion in debt and the debt service payments consume all the dedicated revenue from sources like the state's gas tax. That means lawmakers and the governor have paid for new roadwork as well as repairs through bonds— more debt.

Democrats have come out in favor of raising taxes, including the gas tax, to close make the fund solvent. But Republicans are balking and on Thursday Christie renewed his opposition to raising taxes.

Christie signed a $32.5 billion budget into law last year, averting a government shutdown. But he also vetoed two Democratic measures that would have raised taxes, and he slashed the state's contribution to the public pension funds, which angered but did not surprise Democrats.

This year, they say they don't know what to expect, said state Sen. M. Teresa Ruiz.

"The only thing I do know is that New Jersey and certainly this country are still struggling economically," she said.

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Associated Press writer Jill Colvin contributed to this report from Washington.