Christie's budget scrutinized in South Jersey

New Jersey lawmakers scrutinized Gov. Christie's proposed $33.8 billion budget Wednesday, hearing testimony in South Jersey on how the spending plan could affect hospitals, higher education, historic preservation, and services.

Even as lawmakers welcomed comments on the merits of funding for those issues, they impressed upon the public the tight constraints of the budget.

The Assembly Budget Committee convened at Collingswood's Scottish Rite Auditorium. The Senate Budget Committee is scheduled to meet March 25 at Rowan College of Gloucester County in Sewell.

Christina Renna, vice president of the Chamber of Commerce of Southern New Jersey and a former Christie staffer, told the Assembly committee that her group supported the majority of Christie's budget, including business tax cuts.

But she opposed the Republican governor's proposal to cut state funding to charity care - through which the state offsets costs incurred by hospitals for treating the uninsured - by $74 million.

Since the program receives a federal match, total funding for charity care would drop by about $150 million, to $500 million.

Christie's treasurer, Andrew Sidamon-Eristoff, has attributed those savings to the state's expansion of Medicaid under the federal Affordable Care Act. About 390,000 state residents have gained health insurance through Medicaid since the law took effect in January 2014.

Renna also said the chamber opposed cuts to higher education operating budgets. Hospitals and universities "are the two economic engines of South Jersey now," she said.

Christie's budget summary says direct aid to colleges and universities would decrease, apparently because of the increasing costs of public employee benefits.

Assemblyman Gary Schaer (D., Passaic), chair of the committee, asked Renna how the chamber proposed making up the difference.

Renna said she supported cost-cutting measures "across the board," as well as Christie's proposed overhaul of the pension and health benefit systems for public workers.

Lawmakers also debated the efficacy of New Jersey's economic incentives programs. The state has awarded more than $4 billion in tax breaks since 2010, a trend that has accelerated since lawmakers enacted the Economic Opportunity Act in 2013, according to New Jersey Policy Perspective, a liberal-leaning research group.

In Camden, these tax credits have been awarded to the 76ers, who are moving their practice facility to the city, and defense contractor Lockheed Martin, among others.

Deborah Cornavaca, legislative director of the liberal nonprofit group New Jersey Working Families Alliance, called for a moratorium on Economic Development Authority-approved tax awards until the agency and the Treasury Department disclose more information about the awards' effectiveness.

Although the EDA operates separately from the budget process, Cornavaca and others noted that the tax breaks the agency has awarded will result in lost revenue in future years.

Assemblyman Jay Webber (R., Morris), a self-described conservative, found common ground with his "progressive" counterpart.

"Tax policy needs to be fair," he said. "When government starts picking winners, it tends to be major corporations with a lot of money and a lot of influence."

He said he had not received "satisfactory answers" from the EDA about how much evidence corporations must provide to the agency to prove they may leave the state without the tax breaks.

"We definitely need more accountability," he said. "And there are projects that have not added net benefits."

Assemblyman Chris Brown (R., Burlington) said the incentives programs, which received broad bipartisan support in the Legislature, were necessary to compete with neighboring states.

"New York is giving away 10-year tax abatements," he said. "How are we competing if we don't do this?"

Lawmakers also heard testimony about New Jersey's antismoking efforts from Corrine Orlando, director of government relations for the American Heart Association.

New Jersey is the "only state spending zero dollars on preventing tobacco deaths," she said.

About 12,000 Garden State residents die each year from smoking-related causes, Orlando said, costing the state $4 billion annually.

Orlando said the state should allocate $15.5 million to the state's depleted Comprehensive Tobacco Control Program, which used to fund smoking-cessation programs and other efforts to prevent tobacco use.

The Centers for Disease Control and Prevention has recommended that the state spend about $100 million on the program.

The program last had $7.5 million until the state cut off funding in 2012, Orlando said.

By contrast, New Jersey used $92 million last year from its 1998 settlement with tobacco companies to help plug a shortfall in the general fund.

Orlando proposed raising the cigarette tax, which she said had stayed flat at $2.70 since 2009. The tax, which is among the highest in the nation, raises about $700 million annually, used for the general fund, debt service on bonds, and charity care, according to the nonpartisan Office of Legislative Services.

Donna Leusner, a spokeswoman for the Department of Health, said in an e-mail that the state uses $2.2 million in federal funds for counseling for smokers who want to quit and for prevention among youths. Medicaid and a state health care plan for public workers also cover smoking cessation, she said.