Sunday, April 20, 2014
Inquirer Daily News

Christie accepts part of Obamacare, abandons income tax cut plan

In a year in which he will go before Democratic-leaning voters for re-election, Gov. Christie offered a largely non-controversial $32.9 billion budget this afternoon that accepts a key provision of Obamacare, abandons his proposal for an income tax cut and slightly boosts funding for education.

Christie accepts part of Obamacare, abandons income tax cut plan

Gov. Christie has a problem with his weight - and his demeanor. (Associated Press)
Gov. Christie has a problem with his weight - and his demeanor. (Associated Press)

For my full story in Wednesday's paper, click here.

In a year in which he will go before Democratic-leaning voters for re-election, a combative Gov. Christie offered a largely non-controversial $32.9 billion budget this afternoon that accepts a key provision of Obamacare, abandons his proposal for an income tax cut and slightly boosts funding for education.

"Fiscal sanity has indeed returned to Trenton," Christie said in front of a joint session of the Legislature. He touted that his budget is lower than the 2008 budget signed by former Gov. Jon Corzine.

"Where else is this happening in America?" Christie asked.

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The bad news for homeowners is that the Republican governor will delay until August his delivery of promised property tax rebates. This is actually the second delay: The money was originally supposed to come last October, and was then pushed into the spring.

Christie is delaying the rebate until after the new fiscal year begins July 1 because the state is running more than a $400 million deficit. Christie promised huge revenue increases for the current fiscal year that have yet to be realized, so holding off on the payment buys him some time.

Christie is also counting on $125 million from the privatization of the state lottery. The state has not signed that deal just yet, but it is in closed-door negotiations with the winning bidder, Northstar, a consortium that has recently taken over the lottery in Illinois.  

Unlike in Pennsylvania, where Democratic Attorney General Kathleen Kane refused to sign off on Republican Gov. Corbett's lottery privatization plan, Christie is not required to send his plan to someone else for review. The Democrats who control the Legislature have asked Christie's treasurer to testify about the plan, which they are skeptical about, but he has so far refused.

As Christie has before, he plans to take $152 million from a clean energy program that is funded through a charge on electric and gas bills. The program provides, for example, rebates for weatherization and high-efficiency appliances, and environmentalistis said it was particularly egregious to cut the program when so many New Jerseyans are struggling to rebuild their homes after Superstorm Sandy. 

Christie is also banking on $166 million from towns' affordable housing trust fund. But that money might not be available at all -- the Supreme Court is currently considering a case stemming from a lawsuit that seeks to block Christie from taking the money for the general fund. 

After being stymied by Democrats in the Legislature and the teachers' union from offering tax breaks to business to fund scholarships so students in failing districts can attend school elsewhere, Christie announced $2 million for a pilot program for 200 students. 

Meanwhile, the state's schools would get $97.3 million in additional funds, with no districts slated for a cut. And businesses will likely cheer the fact that Christie will maintain the corporate tax cuts that he had enacted earlier in his term. 

But there are proposed spending cuts, too, including nearly $13.5 million from the Department of Environmental Protection. The 3.9 percent decrease facing the department is the largest of any state agency. 

Christie will follow through with the landmark pension reform bill he signed in 2011 and propose a $1.7 billion payment to the struggling pension fund, the largest such payment in state history.

On that note, he made what appeared to be a reference to his Democratic opponent in the gubernatorial race, State Sen. Barbara Buono (D., Middlesex), who voted against the pension reform bill.

"Our citizens are fortunate that your type of politics in Trenton is dying, and our pension system is alive as a result," Christie said.

Still, his reforms - and this proposed payment - is lower than what Wall Street bond rating agencies had sought.

Christie also chided Democrats for not supporting his across-the-board income tax cut proposal from last year, which Democrats said the state couldn't afford. While the new budget doesn't fund an income tax cut, Christie said if Democrats agreed to his proposal he would find a way to work it into his budget. That is unlikely, though.

In his 45-minute remarks Christie seemlessly moved from lambasting Democrats to high-minded talk of recovery after Sandy. He will seek to set aside a small amount of money, $40 million, as a contingency for Sandy victims if insurance and federal relief money doesn't cover necessary costs.

But it is the expansion of Medicaid under Obamacare, which will cover tens of thousands of poor New Jerseyans and save the state $227 million, that will be the most well-publicized part of this plan. It goes to the most controversial national issue of the last few years, Obamacare, and the politics of the 2016 GOP presidential primary, of which Christie may be a contender.

"Now let me also be clear, I am no fan of the Affordable Care Act," Christie said, using the formal name for Obamacare. "I think it's bad for New Jersey, and I think it's bad for America...however, it is now the law of the land." 

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