Mayor’s Message: the process in Trenton “is not effective”

In this week's message: Mayor Manzo discusses the governor's budget and why the process in Trenton is ineffective.

The first quarter is always budget season for state and local governments in New Jersey. In fact, the governor introduced his proposed budget for 2020 recently. It calls for $40.9 billion in spending, compared to last year’s budget of $38.7 billion. In the coming weeks, the two houses of the legislature will debate the details, make some changes, negotiate with the governor’s office and ultimately the governor will sign the final, agreed upon, document. I’m not going to discuss the details of Governor Murphy’s proposal, which includes a steep Cigarette Tax increase, a Millionaire’s Tax (again), a hefty corporate healthcare penalty tax, an expanded Tuition-fee College program, an increase in funding to NJ Transit and a record pension payment. Feel free to read all 91 pages online (www.nj.gov/treasury/omb/publications/20bib/BIB.pdf). The final version will be slightly different.

Details of this budget aside, today I want to talk about why I think the “process” in Trenton is not effective. This is not just my harsh perspective or a matter of opinion. It’s a fact. New Jersey’s government worker pension is severely underfunded, to the tune of $130 billion. In layman’s terms, that’s how short they are to make all the pension payments promised to the 800,000 current and future retired workers. The state has less than 40 percent of the money they should have in that account, which ranks dead last among US state pension funds. That doesn’t count the $100 billion shortfall in the state’s Health Benefit Fund.

The weight of more than $200 billion in unfunded pension/benefit liabilities has brought us to the brink. There are current proposals to address the problem, including The Path to Progress Report. The point being that everyone knows that a systematic change to the way Trenton functions fiscally is needed. I’ve been encouraged by the acknowledgement of that fact by state leaders, but only action counts. And frankly, I’m disappointed in the lack of the significant action I expected, considering all the rhetoric.

I recently attended the annual Mayor’s Legislative Day in Trenton, which invites all 565 mayors for an all-day event of discussions; about 100 mayors were present. The highlight is an hourlong round table with the legislative leadership. This included Senate President Steve Sweeney (D), Assembly Speaker Craig Coughlin (D), Assembly Majority Leader Lou Greenwald (D), along with Senate Minority Leader Robert Singer (R), Assembly Minority Leader John Bramnick (R) and Senator Anthony Bucco (R).

These are all dedicated officials and I’ve seen them speak many times. The comment that struck me this time was the acknowledgement, more like the surrender, that Trenton will continue to spend money even though curtailing spending is paramount to the required fix. They stated that revenues are up this year, with the economy booming as it is. We all want more programs provided by the state, just like we want a shore house or Ferrari. But spending a temporary windfall like a drunken sailor when we should be making cuts and a systematic change is not the answer. And I’m afraid the governor’s budget is doing that. Perhaps he should have delivered his budget address wearing an admiral’s hat?