Gov. Chris Christie is once again pushing for a tax cut, this time just as his re-election campaign is gearing up.
Like Bill Murray in the movie "Groundhog Day," New Jersey residents must feel as if they are living the same scenes over and over. Just like the tax cut Christie proposed last year, this one comes up against a stubborn fact: We can't afford it.
And the Democratic response is familiar. Sen. Barbara Buono, D-Middlesex, Christie's Democratic challenger, said that if Christie wants property tax relief, he should OK higher state tax rates for the state's 16,000 millionaires, a non-starter the governor has already vetoed three times.
Others pointed out that Christie already has pushed a $396 million payment for property tax relief for seniors and moderate-income taxpayers into next year to plug a budget hole and that the nonpartisan Office of Legislative Services says the state faces a $637 million revenue shortfall by the end of the next fiscal year, in June 2014.
Christie floated the idea of property tax credits, phased in over four years, in his conditional veto of a bill to increase the Earned Income Tax Credit for the working poor. He said he would sign such a measure if the Legislature approves his tax-credit plan.
The tax plan is similar to one proposed by Senate President Stephen Sweeney, D-Gloucester, last year, as an alternative to Christie's idea of a 10 percent across-the-board cut.
Property taxpayers with household incomes up to $400,000 would receive a $100 credit in 2013, and credits of 4 percent in 2014, 8 percent in 2015 and 10 percent in 2016, capped at $10,000. The plan also include tax refunds for renters. By its fourth year, the cut would cost the state about $1.4 billion annually.
In a move that is somewhere between brilliant and diabolical, Christie offered to include a "circuit breaker." If revenue doesn't meet projections, lawmakers can stop the cuts with a simple vote that doesn't require his signature. In other words, Democrats would simply have to go on record denying folks the tax relief Christie has tried to give them.
Christie's proposal is certainly designed to help his re-election efforts. And a tax cut would be a nice addition to his resume if, as expected, he seeks the Republican presidential nomination in 2016. Unfortunately, none of the state's fundamental financial problems have changed since the last round of tax-cut fever.
New Jersey has one of the worst bond ratings in the country, and Wall Street is threatening to lower it again. Payments required under the 2011 pension reforms will increase each year until they hit $5 billion annually in 2018. Interest payments on money borrowed for the Transportation Trust Fund will continue to balloon. These costs are in addition to the budget problems the state already has.
Don't be fooled by all this tax-cut talk. The laws of math still hold.