Governor Christie seems to have played the rotten fiscal cards he inherited fairly well.
As reported by the Star-Ledger, he is proposing to cut school aid by more than $800 million, and municipal aid by nearly $500 million, as part of his solutions to bring a wildly out-of-balance state budget into equilibrium.
By proposing a hard 2.5% cap on local property taxes, however, Christie has deftly removed potentially the strongest Democrat argument against the aid cuts – that they will cause local property tax increases. The current cap of 4% had so many loopholes that the Star-Ledger reported more than half of municipalities actually increased taxes beyond the statutory cap.
With this bold proposal, Christie has not only kept faith with a tax-weary electorate, but he has backed any opposition into a box — by opposing a tax cap, opponents can easily be painted as favoring higher local property taxes.
This plan will force school districts and municipal governments to face the hard realities that our new Governor has had to face at the state level— how to reduce spending without raising taxes.
It is PRECISELY what the electorate said last year.
On substantive and political grounds, it is life-changing for the public sector special interests and even well-meaning school boards and elected municipal officials – who will be given the tools by the Governor and Legislature (if enacted) to make decisions that even they have not been forced to face in the past.
Adult conversations about pay cuts, benefit cuts, pay freezes, and even layoffs can now start taking place all over New Jersey’s governments at all levels. School boards will be forced to choose between parents and kids – or the teachers’ union that dominates many of these elected bodies. Municipal governments will face squarely the reality of huge police and fire salary increases, benefits and pensions, in light of lower tax revenues.
These are the adult conversations that businesses and families have been having for the past 2 years, as they have grappled with a slowing economy, shrinking incomes, or slowing business. Now governments will join the conversation.
A startling new day in New Jersey is about to arrive tomorrow. It’s about time.