A mandatory pension payment forced Gov. Chris Christie Tuesday to propose the biggest budget in New Jersey history, a $34.4 billion spending plan that does not include a once-ballyhooed tax cut.
The budget also includes no tax increases, which would be a likely death knell for a Republican with presidential ambitions.
“Now there will be some that would advocate that the answer is to raise taxes,” Christie said in a State House speech to legislators in Trenton.
“Not only is this an unfair solution, it isn’t a solution at all. We just can’t raise taxes enough to pay for the exploding costs of public- employee pensions and benefits.”
And, even as he signed off on the $2.25 billion pension payment, Christie sounded the alarm about the need to address the burden of state-funded benefits.
He peppered his speech with warnings about “tough choices” and a “looming crisis” unless the state made further changes to its system of retirement benefits for public workers.
“Across the country, we are sacrificing university research, support for K-12 education, funding for the environment and energy and infrastructure of all kinds on the altar of these three things: pensions, health costs and debt,” said Christie, who is still under fire for his administration’s role in the George Washington Bridge lane-closure scandal.
“Due to these exploding entitlement costs, we are failing our taxpayers when we refuse to honestly address these problems and try to fool them into believing that choices do not need to be made. We are better than that. New Jersey is clearly better than that.”
The tough-talking Christie made a strong connection between rising retiree costs and the state’s inability to adequately fund other priorities such as education, tax relief and drug rehabilitation.
The state’s retirement age was also raised to 65 from 62.
In his state of the state speech in January, Christie proposed a longer school day and longer school year, but did not say how he intends to fund them.
The pension payment was slated to be $2.4 billion under a state law Christie passed after tough negotiations with Democrats in 2011.
The law required the state’s obligation to increase annually for seven years as a giveback to state workers, who would pay more into their benefits.
The budget proposal all but abandons his once-touted tax cut, as well as earlier administration efforts to privatize certain services.
The spending plan does, however, maintain property-tax rebates at current levels for those who are elderly, disabled or earn less than $75,000 a year.
The budget if approved by the legislature, would go into effect July 1.
Christie will start selling it at a town hall meeting Wednesday in Morris County.
“Today, I present to you a budget that is balanced, and, for the fifth year in a row, that requires no new taxes on the people of New Jersey,” Christie proclaimed.
“The budget enables us to provide vital support for programs that help our citizens when they need it most.”
The budget speech comes as the Republican’s administration is mired in scandals that have hobbled the start of his second term and threaten his future political plans.
After e-mails surfaced linking key staffers to the political payback scheme to close bridge lanes in Fort Lee and create traffic nightmares, Christie aides were accused of withholding Hurricane Sandy relief funds to get a town mayor on board with a development project.
The administration has denied the storm aid charges and Christie has said he had nothing to do with the planning or execution of the lane closings.
With Post Wire Services