Corzine to Kill Income-Tax Increase If Economy Turns
Oct. 2 (Bloomberg) -- New Jersey Governor Jon Corzine, theonly U.S. incumbent seeking re-election this year, said he wouldrepeal a temporary income-tax increase on high-wage earnersearly if the economy rebounds.
Corzine also would boost property-tax rebates, enforce acap on increases, and seek more funding for public schools aspart of a plan to lower real-estate levies, he said in aninterview today in New Brunswick. He said would seek strongerstate ethics rules to fight corruption at the local governmentlevel in a second term, he said.
The New Jersey governor trails Republican challengerChristopher Christie in opinion polls which show disapprovalwith his handling of the state economy. Corzine this year raisedtaxes and cut state spending to close a budget gap.
The economic crisis has “hurt people and undermined thesecurity of those folks,’ he said. “In every timeframe inhistory, when there is a tough national or even global economicchallenge, it lays down the responsibility at those in power tosay why we are suffering.”
Corzine said in a debate yesterday he wouldn’t pledge notto raise taxes as they may be necessary to cope with any revenueshortfall. “We need to be able to balance the budget in lightof what we want to do,” he said, referring to full educationand health-care funding.
The state faces a projected deficit of $8 billion nextfiscal year after temporary tax increases expire, it losesfederal stimulus money and confronts growing pensionobligations, the nonpartisan Office of Legislative Services saidJuly 21.
Tax Revenue
Corzine, the former co-chairman of Goldman, Sachs & Co.,promised in his 2005 campaign to apply his Wall Streetexperience toward repairing government finances. Since he tookoffice, New Jersey’s revenue has slumped as consumers andbusinesses cut spending. Unemployment in the state climbed to a32-year high of 9.7 percent in August, from 4.8 percent inJanuary 2006, Corzine’s first month in office. The nationaljobless rate was 9.7 percent in August and 4.7 percent inJanuary 2006.
The governor said funding increases for education, pensioncontributions and fully funding the state’s unemploymentinsurance fund are priorities. The one-year income-tax increaseon those earning between $400,000 and $500,000 is “one of themost challenging” new taxes or fees in the budget, he said.
“The criteria would be whether we can get the budgetbalanced” without the additional money, he said.
Campaign Ads
Corzine said Christie has so far failed to present aspecific plan for how he’ll lower taxes. The governor, who hasrelied heavily on critical television ads, wouldn’t say how muchhe plans to spend on his campaign.
The governor has been trailing Christie in polls sinceFebruary. The gap between the two candidates narrowed afterCorzine ran ads attacking Christie’s fundraising support forformer President George W. Bush.
Christie led Corzine by four percentage points, 43 percentto 39 percent, in a poll released Sept. 30. The survey byQuinnipiac University has a margin of error of plus or minus 2.8percentage points. In a Sept. 1 poll, Christie was ahead ofCorzine by 10 percentage points.
‘In a Crisis’
Christie, 47, has criticized Corzine for raising taxesduring a recession, and accused him of mismanaging the state.Christie’s spokeswoman Brittany Bramell didn’t return an e-mailand phone call left at his campaign headquarters.
“New Jersey is in a crisis,” Christie said last nightduring the state’s first of two gubernatorial debates sanctionedby the Election Law Enforcement Commission. “We’re in a crisisbecause we tax too much, because we spend too much and becausewe borrow too much. What we need to do is reduce spending inthis state. Then we need to cut taxes for individuals and smallbusinesses.”
New Jersey’s election is seen as a referendum on PresidentBarack Obama, who has called Corzine a friend and campaigned forhim. Democrats have sought to remind voters that Christie was anappointee of Bush, whose policies they say contributed to NewJersey’s financial problems.
Corzine played down contact with the Obama Administration.
New Jersey in August had the credit-rating outlook on its$31 billion of debt cut to negative from stable by Moody’sInvestors Service, which cited the state’s declining revenueposition.
New Jersey has Moody’s ratings of Aa3, the fourth-highestinvestment grade, on $2.5 billion in general-obligation bondsand A1, one level lower, on $28.5 billion in appropriation-backed securities. Its net tax-supported debt load is the third-highest among U.S. states after California and New York,according to Moody’s.
To contact the reporter on this story:Terrence Dopp in Trenton, New Jersey at tdopp@bloomberg.net.
Last Updated: October 2, 2009 18:36 EDTSource: Bloomberg
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