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At First Public Hearing on Budget, Focus On What's Missing, What's Needed

Speakers present Senate panel with list of items ranging from familiar -- school funding, transportation, pension benefits -- to substance-abuse treatment and others more easily overlooked

State Sen. Paul Sarlo (D-Bergen)

The focus at the first public hearing on Gov. Chris Christie’s proposed $33.8 billion spending plan for the next fiscal year was as much on what’s missing from his budget as what’s in it.

Speaker after speaker during yesterday’s hearing at Bergen Community College in Paramus asked members of the Senate Budget and Appropriations Committee to consider increasing funding for their particular area of interest, whether it was school funding, substance-abuse treatment, transportation, or something else.

“The state budget is more than a fiscal plan,” said Sister Patricia Codey, president of Catholic Healthcare Partnerships of New Jersey. “It reflects our values as a society.”

Codey spoke during the hearing, which started in the morning and lasted well into the afternoon, against a $148 million cut in charity-care funding for hospitals that’s been proposed in the budget Christie put forward last month. She questioned the notion that Medicaid expansion in New Jersey is easing the reliance on the state’s aid.

“These cuts will provide additional problems for our hospitals and our state,” Codey said.

She was among the more than two dozen people who spoke during the hearing, the first in a series that will be held this month as lawmakers begin to more closely evaluate Christie’s budget proposal. The next hearing, hosted by the Assembly Budget Committee, is scheduled for today in Collingswood.

The gatherings offer lawmakers a chance to hear directly from citizens and groups that represent a particular interest in New Jersey.

“These meetings are to hear your concerns and guide us on what your additional needs may be,” explained Sen. Tony Bucco (R-Morris) yesterday.

Questions about school funding, pensions

Among the first to testify in Paramus was Sean Spiller, treasurer of the New Jersey Education Association. He said Christie’s proposed budget holds back about $1 billion in spending for the state’s school-funding formula.

He also raised concerns about the state's public-employee pension system, which has a funding gap of between $37 billion and $83 billion. A 2011 reform law forced teachers and other public employees to contribute more for their healthcare and pensions, but Christie has gone back on another component of the reform effort, which was to increase state contributions into the pension system.

Christie’s budget includes $1.3 billion for the pension system, not the roughly $3 billion he previously committed the state to paying.

“We believe the governor should live up to the law he promoted and signed,” Spiller said.

Also raising concerns about funding was Janna Chernetz, a senior policy analyst at the Tri-State Transportation Campaign. She said the $600 million in borrowed funds the state is planning to spend on transportation projects in the next fiscal year is inadequate.

Christie promised in 2011 to increase “pay-as-you-go” transportation funding in the annual state budget, but he’s been unable to do so as revenue projections have trailed his growth estimates over the past several years. His proposed budget for the fiscal year that starts July 1 includes no “pay-as-you-go” component, leaving only the borrowed funds.

She also said too much money from New Jersey Transit’s capital budget is being used to fund operations, which means even less investment in infrastructure. The agency is also considering its first fare hike since 2010.

“The funding structure is broken,” she said.

Support for gas-tax increase

George Rath, a resident of Tenafly, told the lawmakers the solution for transportation spending is hiking the state’s gas tax. At 14.5 cents, New Jersey has one of the lowest gas taxes in the country. And beginning July 1, all of the money that’s generated by that tax will go to paying off the state Transportation Trust Fund’s debt, with no money left over for new road, bridge, and rail projects.

Christie, a Republican, and Democratic legislative leaders have been discussing a way to replenish the fund, and a gas-tax hike remains on the table.

“I know it will take a lot of courage because it’s a hot political issue,” Rath said. “I think it will be a good thing for the citizens of New Jersey.”

But others told the lawmakers they should consider cutting taxes.

Susan Barbey, a resident of Ridgewood, urged the committee to address the state’s so-called “death taxes.” New Jersey is one of only two states that levies both an estate tax and an inheritance tax, and the two bring in a combined $750 million in revenue annually.

Barbey said lawmakers should elevate the threshold of the estate tax, which starts at $675,000, lower than any other state’s.

“This tax is clubbing the middle class to death,” Barbey said. “You all have to do something about it.”

She also said the inheritance tax is not levied against estates, but “against people.”

“This tax alone is a wakeup call to just how bad dying in New Jersey is,” Barbey said.

The state’s implementation of student PARCC (Partnership for the Assessment of Readiness for College and Careers) testing was also a concern voiced by several residents who spoke during the hearing, including Kim Barron of Mahwah.

The mother of a 14-year-old high school student, she questioned whether federal curriculum standards are leading teachers to focus too much on test results.

“My concern is, that means teachers’ hands are tied and they aren’t allowed to educate students according to each individual’s needs,” she said.

Susan Cauldwell, from the organization Save Our Schools NJ, said school districts are also being forced to spend money to comply with PARCC and federal Common Core mandates.

“This committee should seriously consider eliminating both,” Cauldwell said. “Doing so will not only halt the spending, but will also let teachers go back to teaching, instead of prepping students for the PARCC tests.”

But the most emotional moment of the hearing came when Earl Lipphardt, senior director of Integrity House in Newark, stepped forward with about 30 different people recovering from addiction. He said money for transitional housing for those receiving treatment that’s been provided through federal grants the state has received in the wake of 2012’s Superstorm Sandy is running out.

“What these folks are going to need is supportive housing,” Lipphardt said. “We have women who, for the first time in their lives, are living independently and safe.”

Committee Chair Paul Sarlo (D-Wood-Ridge) said big-ticket items like the pension system and Transportation Trust Fund get much of the attention, but “these faces that we’re looking at are the faces of the budget.”

Several other lawmakers also offered encouragement to those standing behind Lipphardt after he finished testifying.

“I think we need to do whatever we can to find those dollars to help you,” said Sen. Brian Stack (D-Hudson).

“All of us, Republicans and Democrats, are working together,” said Sen. Kevin O’Toole (R-Essex).

The Senate panel’s next public hearing on Christie’s budget will be held on March 25 at Rowan College at Gloucester County in Sewell. In addition to today’s Assembly Budget Committee hearing at the Scottish Rite Auditorium in Collingswood, that panel will also hold budget hearings at Passaic County Community College in Paterson on March 18, and at the State House Annex in Trenton on March 24.

After the public hearings are finished, lawmakers will hear more details about the budget from Christie administration officials during a series of public meetings in Trenton. At the conclusion of the process, they can either adopt Christie’s budget proposal unchanged or send the governor their own budget bill, something they did last year after they could not strike a deal with Christie on the state contribution to the pension system.

Lawmakers and the governor have until July 1 -- a deadline set by the state constitution -- to adopt a new budget.

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