Christie acts on FY2016 budget, slashing $1.6 billion from Dem plan

TRENTON — Gov Chris Christie took action on the state’s FY2016 budget today, vastly paring down a proposed $35.3 billion spending plan passed by Democrats yesterday with line-item vetoes of a handful of major tax hikes.

Speaking to reporters at a press conference in the statehouse, Christie announced that he had slashed $1.6 billion from a plan Democrats passed yesterday — nixing such provision as a “true” high income surcharge on individuals who make over $1 million a year and a one-time 15 percent surcharge the state’s on corporate business tax.

He did not, however, say what he would do about a proposed $3.1 billion payment, the full scheduled payment for FY2016, for a beleaguered pension and benefit fund, though cuts in that area are likely inevitable as well. Christie’s own proposed $33.8 billion budget includes a partial $1.3 payment, and observers note the final figure is likely to come in close to that number.

“Once again the legislature overspent,” Christie said, noting the discretionary spending in the current budget — which incliudes everything other than pensions healthcarre and debt service — comes in at $2.3 billion less than the budget lawmakers passed eight years ago, in 2008.

The cuts were largely predictable, affirming what many Democrats feared and what Christie himself has said numerous times over the past several months. He said he was “disheartened” at the party’s unwillingness to truly negotiate a spending plan with him.

He added the cuts should “show the people of our state that when we said we were going to make government smaller, that we in fact have kept with that promise and continued to do so despite lots of attempts by the legislature to do otherwise.”

More surprisingly, however, was that Christie did not outright veto the proposed millionaires tax — but conditionally vetoed it, asking the legislature to agree to an increase in the state’s Earned Income Tax Credit from 20 percent to 30 percent.

Democrats’ budget did include an increase in the EITC, but it was less than the one Christie recommended, from 20 to the federal 25 percent.

Christie acts on FY2016 budget, slashing $1.6 billion from Dem plan