Tuesday, March 30, 2010

Trenton Faces the Governor’s Fiscal 2011 Budget

The following is the text of Doug Palmer's prepared remarks for the special meeting he called for 5:30 pm this evening.

Good evening, and thank you for coming tonight for this information session.

I am sure that most of you have heard or read about Governor Christie’s proposed budget.

Certainly, we all recognize that the State of New Jersey is among the worst-hit states from the recession and that the Governor is trying to balance a State budget with a $10.7 billion hole in it. To do that, he has proposed cuts of $445 million in municipal aid, to be replaced with $159 million. The cities are then expected to compete for those remaining crumbs on the table.

I am sure you have heard or read that many in our community and in others all around us are in a state of  shock about Governor Christie’s plan.

What I don’t know, and must be sure of, is that you understand the SEVERE IMPACT that Governor Christie’s proposed budget would have – ESPECIALLY on those of us who are residents of the Capital City. For Trenton, because of shoestring budgets that have always reflected little money, reduced money, or no money – we are accustomed to the idea of doing more with less. We are used to being told “this grant isn’t being funded” or “that aid has been reduced.” So the notion that the State would be up to its same old tactics of slighting its own capital city is neither a surprise nor a foreign concept to us.

But to say to the state’s ONLY capital city…the ONLY city in the great state of New Jersey to host the Capital Dome and all that comes with it ... to say to this capital city … “I know that we bring an additional 30,000 people a day into your city to ride on your streets, to be protected by your fire department, to be serviced by your police and other emergency personnel” … to say to this capital city, “regardless of how we lean on, depend on, and otherwise EXPECT the City to shoulder and support State government, despite the burden of that reality, I am going to cut every dime of the dollars that have helped bear the load as Capital City Aid. Times are tight and at the end of the day you are no different than any other municipality in New

Just two weeks ago today, that was clearly the overwhelming tone of the Governor’s proposed cuts to Trenton.
Now, if we start by looking at what is true for the city of Trenton, here’s what we find…Trenton is roughly seven and a half square miles.

The State of New Jersey takes up about two-and-a-half square miles of Trenton … mostly in prime locations where developers would jump to get the chance to build.

That means the State sits on one-third of our property…on 213 properties to be exact.

IF they provided State aid based on our proposed tax rate for this year, that is, the same tax rate you and I have to pay, the City of Trenton would receive more than $155 million this budget year from the State of New Jersey. Instead, this year we received $87.6 million, which included a reduction.

Now, the Governor proposes to deliver real devastation for next year, with a proposal that ELIMINATES more than $42 million. That would include loss of EVERY DIME of our Capital City Aid … and other municipal aid as well.

So what’s the impact of a loss of $42 million; what is the impact on the City’s budget if that happens?

Some are speculating about layoffs. The reality is that a $42 million cut would be far worse than layoffs. A cut of this magnitude would likely threaten our ability to govern and manage ourselves as a City. To give you
some sense of this, there are entire Departments that run on less than $3 million, because of streamlining measures that we’ve already taken.

So that gives you a sense of how much cutting we would have to do to balance the budget with any cut as massive as $42 million.

And these are just the proposed cuts to the City’s budget. We haven’t even talked about the other draconian measures that would cut funding AND close the doors of unique and important institutions like Thomas Edison State College.

We haven’t discussed the fact that we don’t know what would happen to the Capital City Redevelopment Corporation, the ONLY state agency working toward the dedicated purpose of helping to bring development to Trenton.

The $42.3 million in cuts that the City faces doesn’t include ANY of the MANY agencies and institutions that are the very lifeblood of this city.

The reason our focus tonight is on the Governor’s proposed cuts to Trenton is because IF we suffer ANY loss of our ALREADY REDUCED and ALREADY INADEQUATE State aid, then our ability to continue to govern ourselves is at SERIOUS question.

This is the matter that the people of Trenton AND the Legislature MUST understand at this critical hour.

As I have discussed this issue, I have come to one conclusion: Either the Governor and the Legislature don’t know what these additional cuts to Trenton’s aid would mean for their capital city or they DON’T CARE what it means … or perhaps, they don’t even care to know. I cannot help but to believe that one of these thoughts is in play.

Well, tonight, we must be sure that we send the sound and the signal that NEITHER of these conclusions is acceptable to us.

By now, you should be saying to yourselves, This is really bad. Because it is. You should also be saying, There’s got to be something we can do.

And there is.

First of all, you can be certain that, as your Mayor, I have had many conversations with members of OUR delegation. Let me be clear: This group gets it. They have understood from the beginning. That’s why the voices and leadership of Assemblywoman Bonnie Watson-Coleman, Assemblyman Reed Gusciora and Senator Shirley Turner were the first and ONLY voices we have heard publicly from the Legislature. They have sent a loud message to the Governor – and they have been hard at work with their fellow legislators to gain their support and understanding for the Capital City’s cause. Senator Turner has sponsored a bill requiring the State to pay its FULL share of municipal taxes to Trenton, and she has received support from our City Council and others.

What we need to do now is to add the strength of our numbers and voices to our legislative delegation’s efforts. We need to call, email and write key members and let them know: WE WANT TRENTON’S FUNDING RESTORED!

Information will be available to you on our website for you to be able to contact our legislators and tell them: We cannot afford to take up even more of the State’s slack. We cannot afford to pay the rent that the
Governor wants to sidestep.

Next month, I will testify before the Assembly in an effort to ensure that everyone understands the devastating impact the Governor’s budget proposal will have on the Capital City region – as well as the State Capital itself – if the Governor is allowed to cut Trenton’s ALREADY INADEQUATE, ALREADY REDUCED State aid.

Of course we are aware that The State of New Jersey is in fiscal shambles.

With an $11 billion deficit, I think we can safely say that’s a fact. I agree with many proposals from the Governor to address this issue – but he needs to know that when he criticizes municipalities for lack of discipline … our City just conducted layoffs and slashed $21 million from our current budget. We are disciplined here.

The State’s public workers’ wages and benefits must undergo reform. Most people recognize that.

The bottom line is that public wages and benefits have outgrown our ability to pay them. That’s clear when we see that the State is billions of dollars behind in funding its pension plans. So, most of us see the reality of the situation. And nobody should fault this governor or the previous one for attempting to reign in the cost of government and to reform its methods of providing services to achieve efficiency. That part, we get.

That part, the people of Trenton understand.

But it gets confusing when the Governor decides that in the name of a balanced budget, he should not pay the rent where he lives. Ladies and gentlemen, the home of the State of New Jersey is TRENTON. I don’t know where the governor thinks he lives … but I can tell you that since 1790 the home address of the State of New Jersey has been TRENTON, New Jersey. That, to me, means OUR city is where he lives….THIS city is his home. And if you are a taxpayer here…that makes YOU his landlord.

Now, I have one question for you….does his proposal to cut more than $42 million, including every dime of the City’s special Capital City Aid, sound like he intends to pay his rent?

If he has proposed to wipe that line item completely out of his budget, does it sound to you like he intends to be a good tenant?

Over the years, I have heard several people say – with pride – that Trenton ought to get off its knees and stop “begging” the state for what we ought to do for ourselves. You know, the old bootstrap theory … you’ve heard it before.

For those of you who have found yourself agreeing with that notion, let me ask you something: If you don’t pay your rent, can you get away with telling the landlord to get out of your face and stop “begging” for what you want?

Or, is it true that whether or not you HAVE the money to pay your rent, you indeed still owe it? Is it suddenly true that if you don’t want to pay … or can’t pay … that the landlord should just go away, or just accept whatever you can give him and stop bothering you?

Ladies and gentlemen, the point is this: The City isn’t begging the State for a single thing.

For years, the City has simply been trying to get the State to do the same thing that you and I must do as property owners or renters in our City … and that is to pay our fair share.

Whether you use the streets in our city or not, as a property owner, you must pay your fair share of the burden of having those streets provided to you.

Whether you utilize the schools or not, as a property owner, you must pay in taxes to help provide them. Whether you ever have to call upon the Trenton Fire Department … you still must pay your fair share for the
protection and comfort of their presence … just in case that fateful day does occur.

What I am suggesting to you tonight is that if the people of Trenton have to pay to help provide the services in our City, is there any reason why anyone should think that the State of New Jersey … the entity that takes up one-third of ALL of our property … the entity that sits on the most desirable tracts of land for development in our City … the entity that sponsors 30,000 people and vehicles into and out of our city on a daily basis … is there any reason why ANYONE should think that the State should have a reduced obligation to provide special, separate and distinct annual funding to help defray the cost that otherwise must be put on the backs of the people who live here?

Earlier, I told you the facts … the things that are true.

Now, let’s consider what is right.

It is nothing more than right for the State Legislature to insist that the Governor put back every dime of Trenton’s Capital City Aid. It is nothing more than right for the people of Trenton to expect that if the State will not pay its fair share it will at least leave intact the amount that we currently receive.

It is equally important that you know that the City has not sat idly by all of these years without trying to encourage and partner with the State to move off of several specific areas near our downtown where private developers have shown a keen interest.

My administration has worked diligently with the McGreevey and Corzine administrations to get them to move off of the parking lot surrounding the Justice Complex and to vacate both the lot and the building from the Health and Agriculture site. We have legitimate development opportunities that have been ready to go for years. But the State has never honestly committed to working with us to do that.

In my time here as your Mayor, from one State House administration to the next, Trenton has been given three answers:

No, the State won’t pay its full taxes.

No, the State won’t vacate prime property so that the City can develop it for full taxes. And now, from Governor Christie, the nightmare of all no’s…

No, we won’t continue to pay even the small fraction of what we had been paying.
Ladies and Gentlemen, there comes a time when people need to understand what is happening to them so that they can take a stand, before it’s already a done deal.

That time is now. The time is now for us to understand that no leader of our city, neither now nor in the future, has the ability to fix our structural deficit as long as the State won’t pay its fair share. No wild-eyed promise from a candidate can help as long as we have no home rule – no ability to create new taxes like Philadelphia and many other cities have done, to deal with their budget issues. Our ability to raise our own revenues is grossly hampered by State law.

The fact is that the State is trying to have it both ways, by not paying its fair share – and by refusing to vacate our prime property so that others who would pay can develop here.

Our position is that the State must pay, or the State must go so others will pay.

Otherwise, we are stuck in the mud of our structural deficit, which means that we have a “built-in” problem that we have NO ability to make go away.

And that “built-in” problem is the tax exempt presence of the State of New Jersey.

My friends, our time is now to understand what is poised to happen to us and to act before it’s too late.

We must make our voices known before it’s too late. Call our legislators. Write them. Let them know the City must have its funding restored –because the ball is in the Legislators’ court. They have the power to make changes to the Governor’s proposal.

Let us act in unity now.

Thank you.

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