Corzine to lay out budget deficit solutions soon

Gov. Corzine expects to lay out solutions for New Jersey's latest budget shortfall within days, he said yesterday.

"You'll hear this week, relatively early," Corzine told reporters. "We're close to coming out with what we will propose."

Corzine faces a budget deficit that could exceed $500 million. He must close the gap by June 30, the end of the fiscal year. New Jersey requires a balanced budget.

Corzine expected to end the year with a $700 million surplus, but the nonpartisan Office of Legislative Services sent out an analysis last week forecasting that revenue would fall $1.2 billion short of expectations, which would consume the state's financial cushion and require more cuts or tax increases.

This late in the budget year - with fewer than eight weeks left - most of the state's money is already spent, increasing the challenge of finding new savings.

Republicans have steadily criticized Corzine, warning that delay in laying out a solution to the shortfall would leave little time for debating his proposals.

Treasurer David Rousseau is scheduled to formally address lawmakers next Tuesday on the revenue picture.

Corzine said yesterday that his administration already had emergency plans in place and had been discussing ideas with lawmakers.

"This is not as if we hadn't done contingency planning if things didn't turn out the way we expected," Corzine said.

Corzine said he was continuing to seek sacrifices from labor unions. He said he expected to see furloughs, wage freezes, or "some derivative of those two."

He reiterated that without some concessions, he would be forced to resort to layoffs, but indicated that he wanted to avoid that option.

He said the number of layoffs needed for the savings he wants would be "absurd in their scope relative to the delivery of services that I think the public expects from its state government."

Hetty Rosenstein, New Jersey area director of the Communication Workers of America, the largest state workers' union, said talks were ongoing.

"We think those kind of discussions are a lot more fruitful than chest-pounding," said Rosenstein.

The first of planned furloughs for May and June were originally scheduled to take effect yesterday but were delayed by a court ruling that blocked the administration from "staggering" the furloughs within departments - forcing the unpaid days off at different times for a particular agency.

Union leaders still hope a hearing before a labor board Thursday can squash the furlough plan, though the administration is saying it plans to release an updated schedule of unpaid time off for state workers on Friday.

With the revenue shortfall looming, the administration is also considering taking out a $2 billion line of credit to get it through the first few months of the next fiscal year.

The state usually uses leftover money to pay its bills and for programs such as municipal and school aid at the start of each fiscal year, before the largest tax collections come in.

But this year, there might not be any surplus, so the state may need the line of credit to "bridge the gap" at the start of the year, before it can collect money from anticipated tax revenues, said Treasury spokesman Tom Vincz.

Republicans continued their barrage of criticism.

"This governor needs to fully reveal the facts of our finances and address the state's residents with his plan to redesign government," Assemblyman Joseph Malone (R., Burlington) said in a news release.