John E. McCormac
State official says New Jersey is living within its means
Guest Column
John E. McCormac
State official says New Jersey is living within its means
Following several months of debate and many long hours of negotiations, New Jersey has a new budget in place for the fiscal year that began July 1. Like many other states managing through the effects of an economic downturn, New Jersey faced many painful decisions this year over how to maintain programs like prescription drugs for seniors, health insurance for needy families and property tax relief, while shielding working families from burdensome tax increases.
With perseverance, we enacted a budget that, for the second year in a row, holds overall spending growth below the rate of inflation. Our fiscally responsible budget cuts $3 billion in planned spending and, for the second straight year, cuts spending on the state bureaucracy. By tightening the state’s belt and making tough spending choices, Gov. McGreevey succeeded in preserving and channeling fiscal resources for programs most important to the people of our state. At the same time, the governor refused to increase the sales and income taxes.
Faced with a $5 billion shortfall, Gov. McGreevey approached the budget process last February with a pledge to not spend money we did not have and to not balance the state’s books on the backs of working families. The $24 billion budget enacted on July 1 is true to these principles, and also increases New Jersey’s investments in education and capital programs that create jobs.
While many other states have raided education funding to help plug budget holes, New Jersey schools will receive more than $8.1 billion in aid this fiscal year, an increase of over $275 million. Special education funding for extraordinary costs will grow by $52 million, and school districts and property taxpayers will also reap the benefits of an expansive construction initiative. The budget also provides funding to bring literacy and reading coaches to our elementary schools, ensuring that all New Jersey children can read by the third grade.
The state’s new budget also upholds the governor’s commitment to providing property tax relief for local governments. New Jersey cities and towns will see their state aid grow to more than $1.9 billion. That commitment will provide needed support for our local police and fire departments, libraries, capital projects, and a number of community services.
In his first budget last year, the governor devoted one-half of the spending plan –– about $12 billion –– to property tax relief. This year, more than half of the new budget is again dedicated to direct or indirect property-tax relief.
Gov. McGreevey has further moved to ensure the safety of our state’s citizenry by providing funding for two new State Police classes, an expansion of the Office of Counter-Terrorism, and approximately $100 million in homeland-security initiatives.
And the governor has balanced a budget that preserves the nation’s premier prescription-drug program to senior and disabled citizens without raising participant costs or reducing eligibility.
Perhaps most importantly, the governor has provided an additional $30 million to reforms in the Division of Youth and Family Services, demonstrating his commitment to protecting the health, safety and welfare of our children. This funding will reduce caseloads and provide a new computer system to monitor the well-being of DYFS children.
The governor’s fiscal policies represent a dramatic turnaround from the policies of the last 10 years, when state spending rose by more than 50 percent and the state debt tripled. We are holding the line on spending, building a larger budget surplus and living within our means once again. And unlike budgets of the past, the FY 2004 budget does not rely on unrealistic revenue projections and irresponsible gimmicks. It is balanced with real, reliable revenues and a $250 million surplus.
These policies help us to keep moving New Jersey moving in the right direction and target our resources to where they matter most –– in our schools, in our working families and in our quality of life.
John E. McCormac is the state treasurer of New Jersey