Administration Drags Feet on Delivering Data Needed to Assess Christie Budget

For lawmakers, delays and lack of details raise issues of transparency and accountability

Assembly Speaker Vincent Prieto (D-Hudson)
New Jersey lawmakers are in the middle of evaluating Gov. Chris Christie’s budget proposal for the coming fiscal year, but they say that job has been made more difficult because they still don’t have all the facts for his past two budgets.

Although New Jersey’s past fiscal year ended nearly nine months ago, the Christie administration has yet to release the final audit for that state budget, which is typically provided before the new proposal is announced.

Also yet to be made public is a list of programs that will be impacted by $343 million in spending reductions for the current fiscal year through budget adjustments known as “lapses” that were announced by Christie’s state treasurer over a month ago.

Lawmakers yesterday raised those issues and other transparency and accountability concerns during a news conference with budget advocates in the State House. They also highlighted a package of bills that touches on everything from how the state projects revenues each year to how the effectiveness of corporate-tax incentive programs is being monitored.

Three of the four measures in the bill package won passage later yesterday during the Assembly’s voting session.

“This package of bills is very important,” said Assembly Speaker Vincent Prieto (D-Hudson).
Prieto, a former chairman of the Assembly Budget Committee, cited recent state spending plans that have failed to live up to Christie’s economic-growth projections, leading to cuts and other last-minute adjustments.

Last year, after state Department of Treasury officials learned of a roughly $1 billion revenue gap late in the fiscal year, Christie trimmed the planned contribution into the public-employee pension system. Now, public-workers unions are contesting in court a similar reduction for the current fiscal year.

But Prieto said also at stake when there are steep budget problems is the funding for other programs that impact the state’s must vulnerable residents. The enhanced transparency and accountability is designed to prevent the budget gaps before they occur.
“We need to make sure that a lot of safety net programs that are essential, that we can keep them there,” he said.

[related]Assembly Budget Committee Chairman Gary Schaer (D-Passaic) just spent the past several weeks holding public hearings to review Christie’s $33.8 billion budget proposal for the fiscal year that begins July 1. But yesterday he referred to the list of the $343 million in “lapses” for the current fiscal year that has yet to be released and other overdue documents, including the comprehensive audit of the past fiscal year, which ended on June 30.

Schaer said not having those materials can hurt the legislative process and directly hamper the budget committee’s efforts.

“When reports are so delayed the information becomes difficult to work with at best,” he said.

The fiscal year audits have typically been released by prior administrations by January, or roughly within six months of the end of the fiscal year. That gives lawmakers plenty of time to take stock of the prior budget before they begin to evaluate the next budget proposal, which is put forward every year in February.

But Christie’s administration has delayed release of the audits in recent years as questions have been raised about the governor’s handling of the state budget following the missed revenue projections, and as Christie has begun exploring a run for U.S. president. Those revenue misses have brought on delayed property tax relief, more borrowing for transportation-capital projects, and reduced pension contributions in recent years.

“The release of the CAFR this year has been slowed by the adoption of new GASB 67 accounting standards, in addition to late reporting by some constituent components,” said Treasury spokesman Christopher Santarelli. (Santarelli provided reasons for why the audit has been delayed this year only after this story was first published.)

And though state Treasurer Andrew Sidamon-Eristoff said during a briefing with reporters last month that the list of lapses “will be published,” Santarelli said yesterday the list at this point is only being disclosed to the nonpartisan Office of Legislative Services in advance of Sidamon-Eristoff’s scheduled appearances before lawmakers on Monday and Tuesday.

”We have provided proposed lapses exclusively to OLS as part of a deliberative, advisory and consultative process,” Santarelli said.

Yesterday’s news conference was organized by Better Choices for New Jersey, a coalition of more than 60 groups including labor, environmental advocates, faith-based organizations and others who share a common goal of protecting public investments.

The bills the coalition is supporting are A-4326, which would establish a three-person Revenue Advisory Board with representation from both the executive and legislative branches; A-3311, which would require more detail on any proposal to increase revenue by more than $1 million annually; and A-660 and A-939, which would require biennial audits and enhanced reporting of corporate tax-incentive programs.

Advancing yesterday were A-4326, A-3311, and A-939.

Analilia Mejia, executive director of New Jersey Working Families, the coalition’s coordinator, said the changes are overdue given the budget problems the state has experienced the past several years.

“We know that budget reform is needed in New Jersey,” she said. “It is urgent.”

Gordon MacInnes, president of the liberal think tank New Jersey Policy Perspective, said keeping tabs on the effectiveness of the corporate tax-incentive programs, which are administered through the state Economic Development Authority, is also vital.

“We need to have the information on the value of the incentives that are being granted,” he said.

And Mejia said she’s hoping Christie will support the bill package given his 2010 inaugural promise to bring on a new era of transparency.

“It’s in line with what he professed to the state he was about,” Mejia said yesterday.