After discussing the budget at a meeting with State Treasurer David Rousseau and two officials from the Office of Management and Budget, Gov.-Elect Christopher Christie said his reaction was a "rueful chuckle."
And at a press conference today talking about that meeting, the faces of Christie and his two top budget advisors, Richard Bagger and Robert Grady – who were also present at the meeting — were dour.
That $8 billion structural deficit we've been talking about for 2011? If things remain the way they are and infusions like the one that came from the federal stimulus for the 2010 budget are not repeated, the men said, that's "the low end of the range." Moreover, the revenue projections for the 2010 budget, which were about $190 million short in the first quarter, are set to continue to come in below projections, while there are expected to be supplemental needs in agencies that will increase spending.
"If you add together the fact that revenues are continuing to come in light and there are supplemental needs, it's clear that we will have a problem in Fiscal 2010 that will need to be addressed," said Grady to a room packed shoulder-to-shoulder with a few dozen reporters and cameramen.
Christie and his advisors did not give details about how they planned to solve the problem, but said they will deliver a letter to Gov. Jon Corzine today about it and said they would undertake four steps:
-Freeze spending in a number of areas, including discretionary grant and state aid accounts, hiring and paid appointments, and regulation that would incur spending. They requested that Corzine line-item veto any legislation that would impact the state budget.
-Review Corzine's proposed $400 million directive to state agencies to find savings and add some recommendations of their own.
-Meet with officials from Moody's, a rating agency, to figure out ways to upgrade New Jersey's outlook, which was downgraded to negative in August.
-Develop "spending reduction and operational recommendations" for Christie "regarding with respect to the current year budget, the coming year budget, and the long-term urgent fiscal issues facing our state."
The men did not get specific about how dire the forecasts from the Department of Treasury were, and gave no hint of what areas of the budget they would cut.
Christie repeated the mantra that "everything is on the table," but did not single out the state's workforce, which during the campaign Christie said he hoped to cut.
"There's no reason for them to be fearful," Christie said when asked specifically about state workers.
"Part of New Jersey's problem has been a short term view to fiscal management: get through this fiscal year and don't worry about what happens next," said Christie. "I told all of you that I was going to govern like a one-termer. We are going to make the decisions that put this state on the long-term path to fiscal health."
Christie, who blamed the fiscal mess not just on the economy but on the past eight years of Democratic governance – singling out former Gov. Jim McGreevey, whose fiscal management he called "obscene" — said he did not know how the news would affect his plans for tax cuts, but pledged that he would not balance the budget by raising taxes.
"Many of you pushed me during the campaign to be more specific about when we would cut taxes and by how much, and I refused to do that. Now you see why," he said. "I had a sense that things were getting worse, and I wanted to be responsible about that…. The answer is I don't know how it's going to affect it, but I can tell you this: I will not balance this budget by increasing taxes."
Assemblyman Joseph Cryan (D-Union), the Democratic State Chairman, said that Christie offered few specifics on his budget plan during the campaign. “We’re still getting the same political speak,” Cryan said.
“Considering the lingering impact of the global recession, it shouldn’t be news to anyone that the state budget is in tough shape, as it is in states throughout the nation,” said Cryan. “Gov.-elect Christie needs to begin offering real solutions.”