Gov. Chris Christie will deliver the Budget Address tomorrow, but the threat of federal cuts is on the minds of lawmakers here in New Jersey. The Christie administration is counting on federal monies to fill budget gaps caused by Hurricane Sandy and so are many people down the shore. To talk about the looming federal cuts and the impact on the state, NJ Today Managing Editor Mike Schneider spoke with Asm. Declan O’Scanlon (R-13).
Anything that can affect the level of aid to Sandy victims is cause for concern, says O’Scanlon.
“It’s a concern but on the flip side we’re lucky that we have really great people at the helm who are going to manage the disbursement of this money and make sure that it’s done fairly and efficiently and we have bipartisan agreement on that by the way,” Said O’Scanlon.
According to O’Scanlon, the state is relying on the federal relief money to help hurricane victims fill in the gaps in their flood insurance coverage, between what is covered and what will make them whole, especially now that there are new FEMA-mandated flood elevation levels. The gaps left by insurance affect homeowners and businesses alike, says O’Scanlon, who cites a business owner in one of the towns in his district as an example.
“He’s got enough money, he can fix his building, but he had $60,000 worth of laundromat equipment,” said O’Scanlon. “It’s gonna be real tough to do that whole nut and still remain profitable enough when he’s done.”
Municipalities would be hard hit as well, he says, if the state is unable to help them bridge the tax gap.
O’Scanlon said, “If you lose 20 percent of your tax base, 30 percent of your tax base, even 10 percent, that’s a tough, tough thing to make up on the backs of people that are already themselves try[ing] to bridge these other gaps we spoke of.”
Actual state revenue has come in significantly under what the Christie administration had projected. O’Scanlon says that while he’s not surprised, he says the administration is not in denial about the real numbers.
“They have said over and over again this isn’t happy days are here again, we’re going to watch, we’re going to pay attention. Growth has been less than we had originally anticipated.”
Despite the less than stellar growth, Declan is optimistic going forward because revenues over the past several months have come in at above the administration’s projections in terms of gross income tax, which he calls the largest revenue source.
He maintains his trust in the administration, saying it has never lied or hidden bad news.
“We’re in good hands with these folks,” said O’Scanlon. “They’ve earned our trust because they’ve been deadly accurate over the past three years’ budgets, and I think that we’re gonna find that this year’s budget will be manageable. There may have to be some judgments, we’ll find out about that tomorrow and the next several weeks, but I think overall there’s plenty of optimism.”