Garden State Patriot

Looks like even more pain ahead for New Jersey taxpayers. According to an article in the Star-ledger, Governor Corzine will need to cut another $105M for next year’s budget.

An analysis released yesterday on the proposed budget predicts tax collections will come up $605 million short of what’s needed to cover the remainder of the current budget year and the new one that begins in July.

If this latest revenue estimate holds true, the shortfall would eat up the $500 million in surplus Corzine has built into his proposed budget and require $105 million in new cuts or tax increases since the state constitution mandates a balanced budget.

“The small, projected year-end balance would be transformed into a deficit,” said David Rosen, budget officer for the nonpartisan Office of Legislative Services.

Rosen said new tax data the governor did not have when he presented his budget six weeks ago indicates revenue collections will come up $383 million short of Corzine’s projections for the budget year that ends in June. Corzine’s budget will be another $222 million short for the fiscal year that begins in July, he said.

“There aren’t a whole lot of options,” he said.

Of course, not “a whole lot of options” in liberal-speak means more tax increases are right around the corner. If one thing is profoundly clear at this point, it’s that the Democratic machine in New Jersey is in denial and refuses to take the necessary steps to cut the size and scope of our bloated State government.

Corzine’s budget proposals do nothing of the sort. In fact, as detailed in an article in yesterday’s Asbury Park Press, Corzine’s budget is chocked with gimmicks and “one-shots.”

Corzine’s claim that his proposed budget spends only $29.8 billion is fiction. The claim disguises the fact that he cut more than $2 billion from current spending only to reinstate the cuts by using an equal amount of temporary federal aid. The federal aid and the spending it supports, however, do not appear in the proposed budget. In reality, Corzine’s proposed spending plan totals at least $31.9 billion.

The federal money, however, won’t be available for the next budget. This use of federal aid rivals the notorious one-shot gimmicks of the McGreevey years.

Half of the federal money will be used to replace a $1 billion cut Corzine has made to state aid to local school districts. If that fiscal wizardry wasn’t bad enough, Corzine also used the federal money to increase aid to some school districts. At a time when state revenues can’t support the existing aid formula, Corzine recklessly used one-shot revenues to extend the state’s aid obligation to some school districts.

While the federal aid is the largest of the one-shots, it’s not the only one. Corzine proposed tax increases totaling more than $900 million, but they are structured to be available for one year only. One-year tax increases are better than permanent tax increases, but they will create a large gap that must be filled next year.

And he’s proposed to raid numerous special purpose funds for more than $100 million. The raids probably can’t be continued in the next budget. In total, more than $3 billion in revenues in Corzine’s spending plan won’t be available for the fiscal year 2011 budget.

His so-called spending cuts don’t withstand scrutiny either. The single largest “cut” reduced by $900 million the state’s contribution to the several public employee pension systems. But this money is owed to the pension funds whether or not it’s paid in the next budget. Corzine isn’t reducing actual spending, but rather deferring a financial obligation to the future.

A few words come to mind regarding Governor Corzine’s approach to managing the state’s pension obligations: shameful, reckless and irresponsible being the foremost in my mind. I’ve posted regarding Corzine’s pension deferral scheme earlier this year, but now the situation looks to be even more dire. In order to pay for the state’s growing pension obligations, Democrats are seeking to fund the system by buying toxic assets – the very same approach that led to the collapse of firms like Bear Stearns. I recommend that you read this article and this blog post on the subject at Red Alerts.

Just like the donkey that symbolizes their part, Corzine and the Democrats are stubbornly refusing to deal with reality. We can’t continue the way we are going. The money isn’t there. We need to drastically cut government and government spending. That is the only solution to fix our mess. Unfortunately, instead of putting the breaks on this runaway train as it is about to run off the tracks, Governor Corzine and the Democrats are speeding it up and leading New Jersey toward economic ruin.

Cross-posted at Conservatives with Attitude! and Red County.