Senate President Steve Sweeney said the Legislature will send Gov. Phil Murphy a budget without the millionaire’s tax increase that the governor is pursuing; he said reforming pension and health care benefits for public employees is vital to solving the state’s fiscal problems; and he said Gov. Murphy should extend the state’s soon-to-expire corporate tax incentive program until a revised incentive program is adopted.
His comments came during a breakfast roundtable on June 11 presented by the New Jersey Chamber of Commerce and the NJBIA.
“Pension and health care are in deep holes,” Sweeney said. “Does anyone think raising taxes will fix it? It would only take us further and further into this death spiral. At what point do you say stop?”
“We stripped the tax (hikes) out,” Sweeney said about Murphy's proposed budget that must be passed by the Legislature and signed by the governor before the constitutionally mandated deadline of June 30. The Legislature plans to soon pass their amended budget and send it back to the governor for his consideration, Sweeney added.
Pension and Health Care Reform
“Why can’t we get people to wake up, and say we have to fix this place,” Sweeney said. “Number one, we have to fix the pension system.”
Sweeney said health care and pensions for public employees “are not part of public bargaining. We do that through legislation.”
Over the past two decades, Sweeney said, the state has reduced pension contributions paid by public employees, lowered the retirement age and, in 2001, gave a 9 percent raise to workers - all through legislation.
“I asked the union to give back that raise,” Sweeney said. “You can guess what the answer was.”
“I’m part of the system because I’ve been here for awhile, not that I haven’t tried to change it,” he said. “I’m screaming fire. It’s a crowded theater. And we need to do something.”
Path to Progress
Sweeney is proposing pension and health care reforms contained in a report issued by his 25-member Path to Progress study group charged with finding ways to make state government more efficient and fiscally sound.
He said, under his reform plan, savings would be felt by towns and counties, who, in turn, would be mandated to “lower their (tax) levies.”
“People say they don’t like my plan,” Sweeney said. “I say, ‘What’s your plan?’ Their plan is tax.”
Corporate Tax Incentives
The Senate President said the state’s corporate tax incentives – a contentious topic in Trenton – are essential to lure companies to New Jersey and keep them here. And he said Gov. Murphy should support a plan to extend the state’s soon-to-expire incentive program until a revised program is developed.
“The reason we are paying so much on tax incentives,” Sweeney said, “is because our (state’s) tax policy is so bad.”