N.J.’s Christie Won’t Shut State’s Agriculture Agency - Business Week

N.J.’s Christie Won’t Shut State’s Agriculture Agency - Business Week

By Stacie Servetah

Feb. 17 (Bloomberg) -- New Jersey Governor Chris Christie said he won’t follow his predecessor’s idea of eliminating the state’s agriculture department to help balance the budget.

“The Garden State is not going to do without a secretary of agriculture,” Christie, a Republican who took office Jan. 19, said in a Bloomberg radio interview today.

Christie, who ousted Democrat Jon Corzine in the November election, faces an $11 billion deficit in the fiscal year starting July 1. Corzine proposed eliminating the agriculture department in 2008 to help close a budget deficit. He abandoned the idea after objections from farmers and lawmakers.

Christie said he’ll cut spending across all departments and won’t raise taxes when he presents a budget next month.

“We have gone down the road in the last decade of higher and higher taxes,” Christie said. “That has not worked. We need to try a new direction, and that new direction is going to be smaller government, less spending and lower taxes.”

The governor and his pick for education commissioner, Bret Schundler, said they told school districts to budget for a 15 percent cut in state aid next year. Christie later told reporters that his administration will work with local officials to ensure the school-aid cuts don’t result in credit-rating downgrades.

Contract Leverage

Christie said he plans to push for legislation that would give school districts more leverage in contract negotiations to save money on salaries and pensions, and require teachers to contribute to the cost of health insurance.

The governor’s plan to freeze $1.6 billion in spending, including $475 million in scheduled school-aid payments, to balance the current state budget drew criticism from educators at a hearing called by Assembly Democrats in Trenton today.

Officials from Cherry Hill, the state’s 12th largest school district, said Christie’s plans would prompt higher property taxes or increased class sizes, and eliminate 173 of 1,700 jobs.

Assemblyman Louis Greenwald, a Democrat who chairs the Assembly Budget Committee, proposed using part of the state’s $500 million surplus before cutting aid and essential social programs.

Christie called the hearing a “parade of horribles” assembled to sway public opinion. He challenged Democrats in the Legislature to pass an alternative package of cuts.

‘Day of Reckoning’

“The day of reckoning is here,” Christie said. “If we continue to push this off, it’s only going to get worse.”

Last year, Corzine signed a $29 billion budget that included a one-year increase in the income-tax rate for residents earning more than $400,000. That surcharge expired Dec. 31, and Christie said he won’t renew it.

He also said he’ll deal with the finances of the state’s Transportation Trust Fund after a budget for the coming fiscal year is approved by the Democratic-controlled Legislature. The fund, which finances the state’s road, bridge and transit projects, will run out of money to pay for anything other than debt service by mid-2011.

“I have to put the TTF on the back burner,” Christie said. “I’ll worry about July 2011 starting in July of 2010.”

When asked whether he’d consider selling state assets to deal with the deficit, Christie said, “All that will be on the table.”

“Stay tuned for March 16 and my budget address,” Christie said. “We just got through fixing the mess that Governor Corzine left us with for fiscal year 2010. Now we’re beginning earnest work on fiscal ‘11.”

--With assistance from Terrence Dopp and Dunstan McNichol in Trenton, New Jersey, and Tom Keene and Ken Prewitt in New York. Editors: Pete Young, Walid el-Gabry

To contact the reporter on this story: Stacie Servetah in Trenton, New Jersey, at +1-609-394-0736 or sbabula@bloomberg.net

To contact the editor responsible for this story: Mark Tannenbaum at +1-212-617-1962 or mtannen@bloomberg.net