FY 2009 State Budget Carnage: New Jersey

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New Jersey's recent budget agreement is somewhat less disheartening with fewer cuts and more aid. Garden State lawmakers plan to only raise taxes on public utilities, a move that would disproportionately affect the poor as energy costs soar. New Jersey, already the nation's fourth-most indebted state, plans to rely on borrowing to channel as much as $3.5 billion toward school construction in the state's poorest cities following a state Supreme Court Order. Legislators opted to cut state aid to help hospitals treat uninsured patients, reduce funding to nursing homes and deny a funding increase (in the face of a rising cost-of-living) for nonprofits that care for the poor and disabled. State funding will also be reduced for municipalities and colleges. Retirement incentives for state workers were increased. But while salary costs will now fall, retirement benefit costs will rise later. Benefits for newly hired government workers and teachers were slashed. On the positive side, households with incomes over $150,000 will no longer receive property tax rebates.

New Jersey lawmakers expressed little sympathy for their plans to choke hospitals and nursing homes. Assemblywoman Joan Quigley, D-Bergen, claimed that "the pain in this budget is being shared pretty equally by everyone." But it is quite obvious that the primary burden of the budget cuts will fall to the poor, disabled, elderly and teachers.

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