Saturday, July 01, 2006

NJ Assembly Democrats want to exclude ‘tax’ from tax and spend
Budget Impasse Shuts Down N.J. Government

TRENTON, N.J. (AP) -- Gov. Jon S. Corzine shut down the state government Saturday after a deadline to adopt a new balanced budget expired, bringing road construction projects to a halt and furloughing tens of thousands of state employees indefinitely.

State parks, beaches and historic sites were expected to close Wednesday - the day after the July Fourth holiday.

It was a grim climax to a bitter dispute with Corzine's fellow Democrats in the Assembly over his plan to increase the sales tax…

About 45,000 state employees were immediately furloughed. The order allows Corzine to keep 36,000 state employees working without pay. Services such as state police, prisons, mental hospitals and child welfare were to keep operating. The casinos could be forced to close because they require state monitoring, though the casino industry is challenging a possible closure in court.

A bid by Atlantic City's 12 casinos Friday to get state monitors declared "essential employees" who would stay on the job despite a government shutdown is now before an emergency appellate court panel, casino association lawyer John Kearney said Saturday.

July welfare checks have already been mailed, said Corzine's chief counsel, Stuart Rabner. But he said next month's cannot be sent unless a budget agreement is reached.

The dispute centers on Corzine's determination to raise the state sales tax from 6 percent to 7 percent to help close a $4.5 billion budget deficit.

Corzine sees the increase as a vital step toward providing reliable annual revenue, but most Democrats in the Assembly - the lower house of the state Legislature - and several Senate Democrats say it is unnecessary.

Opponents have questioned the need for a sales tax increase, predicting voter backlash and demanding that any increase be reserved for property tax reform. No formal talks between Corzine and legislators were scheduled Saturday. [Ed. – Ah, there’s the rub – the citizenry might discover that the Dems have been spending like drunken sailors and throw the bums out]

Corzine complained that budget efforts "have not resulted in the sort of responsible plan the public has a right to expect."

The shutdown marks the first time the state government has had to close because of a budget dispute.

"What's happening in the Statehouse is shameful," said Assembly Minority Leader Alex DeCroce, a Republican.

The state Constitution requires a balanced budget by July 1, but the deadline has been missed four times in five years. Nothing happened when deadlines were missed before, but the state never went past the morning of July 2 without an adopted budget. Without one, the state has no authority to spend money. The shutdown lasts until a budget agreement is signed.

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