WOODBRIDGE, NJ (AP) Governor-elect Jon S. Corzine on Dec. 13 forecasted “serious challenges ahead” for New Jersey as the state’s projected budget deficit nears $6 billion and business owners report sinking confidence in the economy.
Corzine, speaking to a state business group for the first time since his election, offered few specifics on solutions to fill the estimated hole in the approximately $28-billion budget. He did reiterate a campaign pledge to offer residents tax rebates and said he would develop a partnership with businesses.
“I am a capitalist. I do believe in business,” said the Democratic U.S. senator, a former chairman of Wall Street titan Goldman Sachs. “I really do want to work with you.”
Seeking to reassure his audience of approximately 300 members of the New Jersey Business & Industry Association (NJBIA), Corzine said, “I don’t think we ought to be looking at business as greedy tax cheats.”
His 25-minute speech came a month before he is to be sworn in, but just hours after association members reviewed a survey of the group that showed broad pessimism about the state and national economies for 2006, a sharp departure from the favorable outlook for this past year.
NJBIA President Philip Kirschner said Corzine’s remarks were sincere and said he was not troubled by the absence of proposed fixes.
Corzine said his campaign pledge for $550 million in tax rebates will add to a deficit of more than $5 billion already projected for the fiscal year starting July 1.
Since the state is required to have a balanced budget, “We’ve got some serious, serious challenges ahead,” Corzine said.
He said he also would address the state’s nearly busted Transportation Trust Fund, a key concern for many businesses since it has supported billions of dollars of road and rail projects since 1984 but is to be out of money by July 1.
A key source of money for the fund is the state’s 14.5-cent a gallon tax on gasoline. Corzine later told reporters that an increase only would be considered if budget holes could not be closed following a “line-by-line” review.
Earlier, the group heard from four legislative leaders. Only one, state Sen. Bernard Kenny, D-Hudson, the Senate majority leader, said he supported an increase in the tax, asserting it was inevitable and that 40 percent of it would come from non-residents.
Corzine also reminded the group of problems facing the School Construction Corp., established by former Gov. James E. McGreevey to streamline state-funded school building in poor districts. It burned through its $6-billion initial funding for those schools, which covered approximately one-third of the work the districts said was mandated by a court ruling.
Corzine also promised to attack the “regressive” property tax system after addressing the state budget’s structural deficit. New Jersey has the highest property taxes in the nation.
He also reiterated campaign pledges for an elected state comptroller for an independent auditing of finances, and to establish an economic development office in the governor’s office to help create more private-sector jobs.
Corzine said more of those jobs would be a great boost for tax revenues.
In its survey, NJBIA members ranked health insurance costs as the worst problem they face. Corzine agreed it is a “big headache” for state government as well, but absent a national system, said he would focus on what could be done in New Jersey, including addressing state mandates.
The NJBIA said New Jersey ranked 41st among the states in creating such jobs in 2004.