Budget Battle is Over

Under orders not to leave the chambers, the New Jersey state Assembly approved a $24.1 billion budget Tuesday, half a day after the legal deadline passed to get the job done.

The vote was 41 to 37 along strict party lines in the Democratic-controlled Assembly.

The New Jersey Senate earlier Tuesday voted 21 to 18 to approve the budget, which includes changes to Atlantic City casino taxes for the first time in 25 years.

Lawmakers agreed to keep working past the June 30 midnight deadline to approve a balanced budget, averting a state government shutdown. The budget now must be signed by Gov. James E. McGreevey, a Democrat. McGreevey has scheduled an afternoon news conference.

Republicans, who held up the budget process until the final hours by refusing to vote for more than $800 million in taxes and fees, blocked a tax on telephones and scaled back proposed fees on home sales.

Casinos, gamblers, smokers, billboard owners and hotel quests will pay more once McGreevey signs the measures into law.

The budget approved Tuesday restores most of the cuts McGreevey made to his original proposal introduced in March. Protests throughout the state then demanded more money for arts, health care and education.

"Those voices were loud and persistent and they made it clear they wanted health care for seniors and dental care for Medicaid recipients and tuition aid for our students," said Sen. Wayne R. Bryant, D-Camden.

The casino tax was one of the major points of contention in negotiations. Casino net profits take the biggest hit under the increased tax, but some fees for patrons also will go up. The tax is expected to raise $90 million.

Casinos promised to help pay for prescription drugs and senior benefits, but those costs have risen dramatically while the share of gambling revenues has not kept pace, said Assemblyman Louis D. Greenwald, D-Camden.

"We need the help from some of the largest partners in our state and we need their help for three years," said Greenwald, the bill sponsor.

The cigarette tax would increase by 55 cents, to $2.05 a pack, among the highest in the nation. Last year, lawmakers raised the tax by 70 cents a pack.

The new budget also cuts property tax rebates to homeowners by 50 percent, cutting the average check to $250 from $500.

Assemblyman Joseph Malone, R-Burlington, railed against the budget, saying Democrats threatened residents with bogus news about deficits and then increased spending and taxes.

"One thing is said and just the opposite is done. The residents of the state should not be subjected to this form of torture," Malone said. "Abbott and Costello could not have written a script for the past two weeks."

The votes ended three emergency legislative sessions that stretched into four days.

McGreevey had warned of a government shutdown if no deal came by midnight Monday, the end of the state fiscal year and the constitutional deadline for a balanced budget. A government shutdown would have halted nonessential state services and close parks and state offices.

Many had expected an early day Monday, after a breakthrough Sunday where GOP senators offered to vote on at least six of the eight bills they had threatened to kill. McGreevey had sought to raise more than $800 million by taxing cigarettes, casinos, telephones and home sales.

The budget agreement pares those proposed taxes by about $200 million.

Although the compromise was reached in principle by late Monday, negotiations continued into Tuesday morning over each line of the proposed budget.

This isn't the first time state lawmakers missed the midnight deadline to vote on the budget. Last year, an emergency session spilled into July 2 after lawmakers bickered over a change to the corporate business tax.

At least five other states -- California, Connecticut, Nevada, Oregon and Pennsylvania -- also faced a July 1 budget deadline.

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