TRENTON – Gov. Chris Christie pocket-vetoed more than 40 bills and walked away from the 2010-2011 session offering the state a tax break and presumably feeling good.
But with all of the last-minute hustle and bustle to pass, then evaluate and act on over 100 bills, each individual measure was less scrutinized in the media. Here are some of the possibly lesser-known measures that Christie took no action on.
In some cases, their sponsors reacted with incredulity and outrage over the governor’s inaction.
S668 – This would have allowed income tax deductions for amounts contributed to the college savings program known as New Jersey Better Educational Savings Trust (NJBEST).
The bill would have allowed a gross income tax deduction of up to $10,000 annually for married couples filing jointly, or $5,000 annually for other taxpayers for contributions to one or more NJBEST accounts.
The bill had strong bipartisan support.
It passed the Assembly on Jan. 9 by a vote of 70-1-4. The Senate had passed an earlier version 38-1 in December 2010.
But in a fiscal note, the Treasury Department estimated that this bill may reduce gross income tax revenue by $6.3 million initially, with revenue losses increasing in future years.
The Office of Legislative Services concurred, and added that “potential future revenue losses could increase significantly as the economy improves.”
But Sponsor Assemblyman John F. McKeon, (D-27), West Orange, disagreed with the governor’s inaction on this bill.
McKeon called it “a lack of understanding of the struggles of middle-class New Jerseyans, particularly those who are sacrificing every day.’’
And then when the governor’s pocket-veto occurred on the same day that he proposed an across-the-board 10 percent income tax cut, McKeon had one word for it: “hypocrisy.”
McKeon said that this administration “has been bending over backwards’’ to provide corporate tax breaks. “That is all well and good,” he said, but the break that the NJ BEST bill would have provided to working families was well deserved as well.
He said he would definitely reintroduce this bill.
A2129 – Expands scope of New Jersey Regulatory Flexibility Act dealing with economic impact of rules on small businesses.
Introduced in February 2010, the bill was unanimously approved by both the Assembly and the Senate before being pocket-vetoed by Christie.
It would have required state agencies to develop streamlined compliance reporting for small businesses. The bill defined small businesses as those employing fewer than 100 full-time employees or having gross annual sales of less than $6 million.
The bipartisan measure was sponsored by Assemblypersons Upendra Chivukula, (D-17), Franklin Township; Alison Littell McHose, (R-24), Franklin Township; and John Burzichelli, (D-3), Paulsboro.
It would have allowed for a process by which small businesses “adversely affected economically” or “aggrieved by final rule-making action” could file a petition with the agency, objecting to all or part of a rule subject to regulatory flexibility analysis. Petitioners also would have been empowered to seek judicial review of a determination on the petition to the Appellate Division of the Superior Court.
Opposed by N.J. Public Employees for Environmental Responsibility, the group argued that the bill could have opened up a rule challenge bonanza that, inch-by-inch, could have eroded regulatory protections, especially in environmentally sensitive areas.
At a committee hearing, a representative of the group said a recent State Commission of Investigation report called for increased regulation of crime-riddled industries like garbage and recycling collection, not decreased regulation as the bill would have allowed for.
Retirement plan participation
S2100 – Prohibits new employees of certain organizations from enrolling in State-administered retirement system or health care plan of public employer.
Another bill with complete buy-in from the Legislature, S2100 was admittedly “tamer” than the lower-chamber version put forth by Assemblyman Paul Moriarty, (D-4), Washington Township. Moriarty initially wanted affected officers currently in the pension system removed, which was a potential legal problem.
Still, Moriarty joined as a prime sponsor of the upper-chamber version, S2100, which passed unanimously in both chambers. The bill was a bipartisan effort based on Christie’s list of toolkit proposals, so Moriarty is absolutely puzzled by Gov. Chris Christie’s pocket veto this week.
“This was part of his toolkit,” Moriarty said today. “As it stands now, by him doing that, these groups can go out and hire people today and put them in the pension system.”
The measure would have disallowed officials from the N.J. League of Municipalities, N.J. School Boards Association, and N.J. Association of Counties, among others, from entering into the state’s pension system. In 2009, a total of 63 retirees from those three organizations were reportedly costing the state $1.3 million in retirement benefits each year.
Republican Assemblyman Gary Chiusano, (R-24), Augusta, asked on the floor during the vote why union officials on leave from government positions – part of Christie’s initial proposal – were not part of the bill. Moriarty told Chiusano in an aside that he had another bill drafted – which Moriarty said he will re-introduce this session – to address those individuals, many of whom have their right to take leave for a union position written into their contracts.
“They’re a different class of people,” Moriarty told Chiusano, who voted for the bill. Of the union portion of the bill, Moriarty said today, “I think we’re talking about five people.”
Even so, the bill was pocketed and died Tuesday.
“The next lobbyist who enters the pension system, it’s on him,” Moriarty said of Christie today. “Once they’re in the system, I don’t think we’ll ever get them out.”
Christie is under no obligation to provide a reason for the pocket veto, unlike an absolute or conditional veto. Moriarty said he was never told why the bill failed to pass muster.
“I don’t know what he wants,” he said of the governor. “I’m not going to speak for them because it’s just crazy.”
Business tax credits
S3054 – Extends certain business tax credit programs to the gross income tax.
This purpose of this bill was to provide gross income taxpayers with the same incentives available to corporation business taxpayers for investment and hiring, particularly sole proprietors, partnerships, and limited liability companies.
Although none of the Republican lawmakers voted against the measure when it came to a vote, some expressed concern in committee. Although the Office of Legislative Services could not determine the fiscal impact of the bill, Assemblyman Declan O’Scanlon, (R-13), Little Silver, said the administration may have been concerned about cost. OLS, in a fiscal estimate, projected that the tax credit expansion would yield “significantly less” cost to the state than the approximately $95 million in annual tax breaks afforded by the initial credit.
The measure was passed unanimously by the Senate in September 2011 and January 2012, while the Assembly passed it, 70-2-4, earlier this month. Only Assemblymen Joe Cryan, (D-20), Union Township, and John McKeon, (D-27), West Orange, voted against the bill.
The measure was sponsored by state Sens. Steve Sweeney, (D-3), West Deptford, and Linda Greenstein, (D-14), Plainsboro, and Assemblywoman Pamela Lampitt, (D-6), Cherry Hill.
Interest on contractor deposits
S317 – Requires contracting units and boards of education to credit contractors with interest earned on certain funds withheld from payment to contractors.
Sponsored by state Sens. Richard Codey, (D-27), Roseland, and Ron Rice, (D-28), Newark, among others, the bill would have required contracting units and boards of education to credit contractors with interest earned on certain retained payments that are released to the contractor upon completion of a project.
Current law provides that the contracting units may retain interest earned on the withheld 2 percent of payments paid to the contractor, but the measure would have provided that the interest on such withheld payments should be paid to the contractor upon completion of a project.
The Senate passed the bill in December 2010 by a vote of 28-9, and the Assembly concurred in January 2012, with another split decision, 63-11-2.
It also would have required the contracting unit or board of education to release to the contractor a subcontractor’s proportionate share of the amount withheld, upon acceptance by the project’s architect or construction manager of the subcontractor’s completed portion of the entire project. Under current law, the contractor has to wait until completion of the entire project before release of the retained funds for the completed work of one of its subcontractors.