UPDATE: Complete coverage of this story in Wednesday's paper is here.

Gov. Christie presented a $32.1 billion budget to the state Legislature this afternoon that increases school aid by $212.5 million, makes the largest payment toward public employee pensions in state history and uses rosy revenue projections to help pay for an income tax cut.

The spending plan is the highest since fiscal year 2008, and about 8 percent higher than the current fiscal year budget. It projects a 7 percent increase in revenues.

"Resolve today to join us in the tough choices which leadership and truth inexorably lead us to, and join us now," Christie told a joint session of the Legislature this afternoon at the Statehouse. "End the nay-saying – join us to accelerate the New Jersey comeback this year."

The fiscal year 2013 budget, which needs to be approved by the Democratic-controlled Legislature by June 30, finds cost savings by restructuring departments that provide services to vulnerable populations without eliminating funding for those programs, according to budget documents. 

Camden City stands to lose an unspecified amount of money as more than half of the state transitional aid program, which the impoverished city relies on for about a third of its budget, is transferred into a fund that goes to all of the state's municipalities.

Specific appropriations to schools and municipalities won't be available until later in the week, but Treasurer Andrew Sidamon-Eristoff said the vast majority of school districts will get an increase in aid. 

The first phase of Christie's proposed 10 percent across-the-board income tax cut is paid for in this budget with $183 million -- although it needs a law to be passed and signed to make it happen. Christie is also increasing the earned income tax credit for the working poor and providing for $350 million in small business tax cuts.

The liberal-leaning New Jersey Policy Perspective slammed the income tax cut plan even while the speech was going on. The group said that the cut would be relatively meaningless to the middle class but provide a windfall for the wealthy. 

"While the governor seems to think it will come from his pie-in-the-sky revenue projections, it's hard to imagine the state's stagnant economy will turn around quite so quickly," said NJPP president Deborah Howlett. "At the end of the day, it will be New Jersey's future generations footing the bill."

Under the proposed budget higher education stands to get a 5.5 percent increase -- with the biggest percentage hike, 12.79 percent, going to Rowan University. The added funds are not related to the proposed merger of Rowan with Rutgers-Camden, but to higher employee benefit costs. The budget also puts $1 million into a not-yet-created college scholarship program geared toward urban youth.

Sidamon-Eristoff attributed the positive revenue projections to a downward trend in the unemployment rate, historic highs in income levels and good retail numbers, like in the automobile sector.

In the first half of fiscal year 2012, revenues only rose 3 percent. But in a briefing with reporters before Christie's 2 p.m. budget address Sidamon-Eristoff said: "We believe that the economy of the state is in fact experiencing a comeback."

According to the budget plan, the Department of Health and Senior Services will return to its old name, the Department of Health, as the senior services element is moved into the Department of Human Services. The new Department of Health will take charge of all hospital funding, which remains flat in this budget, as part of the change.

The Department of Corrections, due to a decrease both in overtime costs and prison population, will see a 2.8 percent, or $30 million, cut. An allocation of $2.5 million is proposed for a mandatory drug court for non-violent offenders, which is a key part of Christie's crime agenda.

For transportation, Christie wants $89 million for transportation capital projects.

Specific appropriations to schools and municipalities won't be available until later in the week, but Sidamon-Eristoff said the vast majority of districts will get an increase in aid.

As he does for big speeches, Christie released a trailer beforehand. Christie tweeted this morning that the video will get you excited for his budget. See below...does it?