The cap is popular among residents, most of whom pay the preponderance of their non-federal tax liability in property taxes. And it has received steadily increasing support from the state’s mayors and other municipal leaders, who rely almost exclusively on property-tax revenue to run their towns. Even Cory Booker — the decidedly liberal, if heterodox, Democratic mayor of Newark, and perhaps the only elected official in the state whose political star burns as bright as Christie’s — has signed on.
But Christie’s amendment is at the mercy of the Democratic legislature, whose assent is required for a popular referendum on it. The deadline for giving it this year has come and gone, forcing Christie to negotiate on the terms of the Democrats’ proposed alternative: a higher, 2.9 percent cap run through like Swiss cheese with exclusions and opt-outs that would render it all but meaningless. Christie was able to whittle down the exceptions to four and reduce the cap to 2.0 percent — lower even than his proposed 2.5. But it is statutory, not constitutional, and therefore subject to the caprice of Trenton. Christie has vowed not to give up the fight.
Other battles loom wherein the governor’s chances for success are highly uncertain. He has promised yet more pension and compensation reforms, moves that could break his tenuous alliance with the reformist elements in the Democratic party and push his openly hostile relationship with labor beyond Thunderdome.
Then there is Christie’s plan to fundamentally reshape the state’s massive gambling and entertainment interests, effectively ending the increasingly unprofitable horse racing in the Meadowlands, and wresting control of Atlantic City casinos from an overburdened and underequipped municipal government. That move is sure to draw the attention — and the ire — of some of the state’s most, shall we say, persuasive constituencies.
But by far the biggest test of the success of this year’s budget battle will be — next year’s budget battle. The fact is that no matter what happens between now and June of 2011, there will be a tremendous temptation to revert to the status quo ante: Either the state’s economy lingers in the doldrums and Democrats claim redemption for their long-failing policies, or Christie’s program helps spur a recovery for New Jersey taxpayers and Democrats come to voters with the message that fiscal crisis has been averted and New Jersey can get back in the business of big government.
But Christie insiders are convinced that the bar has been reset, and that they can fight next year’s budget wars on their terms.
“They say there is another $10 billion gap for next year,” says one top Christie insider of the 2012 budget.
That’s based on the assumption that you take your hands off the wheel, and you go back. You don’t do any reforms, and you therefore put back all of the money that was pulled this year. No. The whole point of resetting the base is that as the economy starts to recover and we start to see some growth, then there is not an automatic conclusion that this program that was cut becomes restored. Then it becomes a serious discussion about what priorities of the state, what taxes should be cut.