September 28, 2010 5:00 p.m. EDT

Governor Christie has put forward a series of rigorous ethics reform measures that are in step with his commitment to change the culture of government in New Jersey and demand accountability to better serve the people.

These comprehensive reforms are tough, but fair and guided by common sense, which is what the people of New Jersey expect.  The proposed measures include:

1. A New, Detailed Annual Financial Disclosure Statement From Both The Executive And Legislative Branches.  Governor Christie issued a conditional veto of, and called upon the legislature to pass, A-2768.  The conditionally vetoed bill would set in statute a May 15^th deadline for the filing of financial disclosure statements (FDS) and sets the filing requirements of an FDS in law – making them permanent.  The Governor’s conditional veto also requires, for the very first time, members of the legislators and their senior staff to file the same FDS as the executive branch. 

Governor Christie’s conditional veto of A-2768 increases transparency by expanding the statutory requirements of financial disclosures to more closely track federal guidelines.  Changes include:

• Expanded value classes for asset and income disclosure (a maximum category of 50M instead of the current 500K);
• Inclusion of members of the Legislature and the Legislature’s professional staff;
• Filers required to provide detailed disclosure of all assets, real property, and contractual arrangements with former and future employers;
• Required disclosure of all parties for whom compensation was received to promote, oppose or prepare legislation; and,
• Codification of all disclosure requirements listed on current state FDS forms as well as certain information presently required to be disclosed on federal disclosure forms (e.g. expanded value classes ranging up to $50,000,000.00)

2. A Full Ban On Dual Office Holding That Ends Grandfathering.  Governor Christie’s plan eliminates dual office holding, and institutes a specific end to the grandfathering period at the conclusion of 2010-2011 Legislature rather than the current open ended grandfathering period that permits dual office holding to persist.

3. A Ban On Dual Employment For All State, County And Local Officials And Employees.  All employees would be prohibited from drawing a salary at a 2^nd government position – state, county or local.

4. An Effective Conflict Of Interest Standard For Legislators.  Governor Christie’s plan redefines conflict of interest disclosures for Legislators to require mandatory recusal and strict disclosure of legislative conflicts of interest.  This puts an end to self-evaluation of whether a Member of the Legislature “feels” there is a conflict.

5. Real Penalties For Those Who Violate The Public’s Trust.  Governor Christie’s plan puts in place real consequences for public officials who break the law:

• Requiring Pension Forfeiture For Public Officials Convicted Of Crimes That Involve Or Touch Upon The Public Office.
• Requiring Forfeiture Of Campaign Funds For Officials Convicted Of A Crime For First Through Fourth Degree Offenses.
• Ban On Use Of Campaign Funds For Criminal Defense Costs.

6. Comprehensive Legislation To Fix Pay-To-Play, Effectively Restrict “Wheeling” And Close Loopholes In Restrictions On The Awarding Of Government Contracts.  The Governor’s plan includes sweeping legislation that will increase transparency and the integrity of the electoral process by fixing loopholes and shortcomings of current pay-to-play restrictions.  Governor Christie’s proposals will:

• Restrict The Practice Of “Wheeling” by imposing contribution limitations on county and municipal committees for committee-to-committee contributions and committee contributions to out-of-county or out-of-municipality candidates.
• Impose A Uniform Set Of Contract Award Standards on all levels of government and all branches of state government.  Governor Christie’s proposal would end the “fair and open contract” exception for businesses that make reportable campaign contributions at the legislative, county and municipal levels, yet are able to receive contract awards valued greater than $17,500 with local governments – a practice that is not permitted at the state/gubernatorial level.
• Close Pay-To-Play Loopholes by leveling the playing field with changes to law that would make labor unions subject to the same contribution requirements which apply to other entities doing business with the state.

As a complete package, Governor Christie’s Ethics Reform plan will increase transparency in government, accountability to the public from elected officials and strengthen New Jersey’s existing laws to ensure that the electoral process is conducted with integrity – a critical step in gaining and keeping the public’s trust in their government. 

Governor Christie has said from the beginning that we need to create a new climate in Trenton that fundamentally changes the way our government is perceived by both New Jerseyans and everyone outside New Jersey.  He aggressively began this process in January 2010 by:

• Signing EO-15, directing a comprehensive review of all state authorities, boards and commissions and taking immediate action to reform abusive fiscal practices signed.
• Signing EO-7 which modifies prior Executive Orders implementing “pay-to-play” restrictions.
• Signing EO-8, which orders and directs the Department of the Treasury publish quarterly reports on all State expenditures, which they are already doing.
• Debuting YourMoney.NJ, an online government transparency center  and increasing transparency of government priorities and performance with the online Governor’s Performance Center.
• Calling for additional, critical reform measures to overhaul the Delaware River Port Authority and bring accountability to the hundreds of boards, commissions and authorities that form the until now invisible and unaccountable layers of government in New Jersey.

As 145 soldiers returning from Iraq and Afghanistan walked through the double doors in Terminal D at DFW Airport last week for two weeks of R&R, they were greeted not only by their families, but by former president George Bush and his wife Laura. 

It is refreshing to see how pro-American and patriotic our former Commander-in-Chief is. Please take a moment to watch this heartwarming and inspirational video of President Bush welcoming home our military heroes (turn on volume).

President Bush is putting something in each one of these soldiers hands. Wonder what it is? It’s a George W. Bush Presidential Coin. It’s part of the handshake and often done this way in the Military. In the Military they call it a “Challenge Coin”. If a soldier does a “Challenge” the person who has the highest ranking coin gets his meal or drink paid for. It will be hard to top that coin!!

Brady said about 40 people, among them retirees and veterans, show up almost daily to help welcome home soldiers with ovations as they depart customs and enter the main terminal. More than 750,000 service members have been welcomed as part of the program, he said, and some purposely ask to reroute their return to the U.S. so they can come through DFW.

OPINION- SEPTEMBER 3, 2010

The president’s plan to raise top marginal rates is holding back the very people who should be leading the economic recovery.

By KEVIN A. HASSETT
AND ALAN D. VIARD

When Congress returns from its summer recess, members will face a pivotal decision about the expiring Bush tax cuts. President Barack Obama has called for their permanent extension for singles with incomes below $200,000 and married couples with incomes below $250,000, but has proposed that most of the tax cuts for households with higher incomes be allowed to expire.

To buttress this position, the president and his supporters have repeatedly asserted that the expiration of these cuts will have little impact, because they affect only a tiny fraction of the wealthiest Americans, people who “can afford it.”

Recently, for example, Vice President Joe Biden harshly rejected House Minority Leader John Boehner’s assertion that the hikes would harm small businesses, saying that “he has created this myth that a tax cut for millionaires is actually a tax cut for small business. There aren’t 3% of small businesses in America that would qualify for that tax cut.” House Speaker Nancy Pelosi flipped the number around, saying that the planned tax increases would exempt “98% of American families and about 97% of small businesses.”

The impact is far more severe than Mrs. Pelosi and Mr. Biden suggest. In fact, the sound bite about 3% of small businesses, which has been picked up by numerous pundits, is one of the more misleading statements in the long history of economic propaganda.

The 3% figure, which is computed from IRS data, is based on simply counting the number of returns with any pass-through business income. So, if somebody makes a little money selling products on eBay and reports that income on Schedule C of their tax return, they are counted as a small business. The fact that there are millions of people in the lower tax brackets with small amounts of business income may be interesting for some purposes, but it is irrelevant for the assessment of the economic impact of the tax hikes.

The numbers are clear. According to IRS data, fully 48% of the net income of sole proprietorships, partnerships, and S corporations reported on tax returns went to households with incomes above $200,000 in 2007. That’s the number to look at, not the 3%. Would Mrs. Pelosi and Mr. Biden deny that the more successful firms owned by individuals in the top income-tax bracket are disproportionately responsible for investment and job creation?

It’s clear that business income for large and small firms will be hit by the higher tax rates. And in point of fact, firms of all sizes contribute to the nation’s prosperity. So it’s a mistake to focus only on the impact of increased tax rates on small business. But will the higher rates actually cause a significant reduction in business activity?

Economic research supports a large impact. A pair of papers by economists Robert Carroll, Douglas Holtz-Eakin, Harvey Rosen and Mark Rider that were published in 1998 and 2000 by the National Bureau of Economic Research analyzed tax return data and uncovered high responsiveness of sole proprietors’ business activity to tax rates. Their estimates imply that increasing the top rate to 40.8% from 35% (an official rate of 39.6% plus another 1.2 percentage points from the restoration of a stealth provision that phases out deductions), as in Mr. Obama’s plan, would reduce gross receipts by more than 7% for sole proprietors subject to the higher rate.

These results imply a similar effect on proprietors’ investment expenditures. A paper published by R. Glenn Hubbard of Columbia University and William M. Gentry of Williams College in the American Economic Review in 2000 also found that increasing progressivity of the tax code discourages entrepreneurs from starting new businesses.

Because marginal tax rate increases impede long-run growth, they should be avoided in good times and bad. But now is a particularly inopportune time to raise rates, as small businesses are still struggling from the recession. According to the ADP National Employment Report for July, goods-producing small businesses have reduced their total payroll employment by 117,000 jobs since January of this year, and they were still posting declines in July.

Taxes appear to be part of the story. When the National Federation of Independent Business asked small business owners in June to list the most important problem they faced, 20% named taxes, making that the second most cited concern after weak sales. The expectation of tax increases, such as those in Mr. Obama’s plan, is on the minds of the people who should be leading the recovery.

The administration defends its desire to increase taxes by citing concerns about the deficit. Treasury Secretary Timothy Geithner recently asserted that “borrowing to finance tax cuts for the top 2% would be a $700 billion fiscal mistake.”

The administration is right to view the deficit as a serious issue, but this sudden commitment to fiscal responsibility is bizarrely inconsistent. The administration professes deep concern about the $700 billion revenue loss from extending the tax cuts at the top, but apparently views the revenue loss of nearly $2 trillion from extending the tax cuts for the middle class as too inconsequential to mention. Nor has the administration’s concern about the deficit driven it to reduce federal spending.

For those who are determined to tax the rich at all costs, and are therefore willing to accept the claims of the Obama administration without scrutiny, the tax hikes may well make sense. But the evidence is clear that lifting the top rates will hamper the business investment upon which our nation’s prosperity depends. That affects all Americans, not just 3%.

Mr. Hassett is director of economic policy studies and a senior fellow at the American Enterprise Institute, where Mr. Viard is a resident scholar.

Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved

Fed Chairman Ben Bernanke Says Extending Tax Relief Would Help The Economy. “Federal Reserve Chairman Ben S. Bernanke said extending the tax cuts passed during former President George W. Bush’s administration would help strengthen a U.S. economy still in need of stimulus. ‘In the short term I would believe that we ought to maintain a reasonable degree of fiscal support, stimulus for the economy,’ Bernanke said today in testimony before the House Financial Services Committee. ‘There are many ways to do that. This is one way.’” (Scott Lanman, “Bernanke Says Extending Bush Tax Cuts Would Maintain Stimulus To Economy,” Bloomberg, 7/22/10)
 
Raising Taxes Will Hit Everyone, Not Just The Rich. “The Bush tax cuts don’t just offer tax relief to the wealthiest Americans. They offer it to just about anyone who pays federal income taxes. Their scheduled demise next year will raise the tax bill of nearly every taxpayer, unless Congress makes changes and the president jumps on board.” (Bob Bischoff, “How The Expiring Bush Tax Cuts Affect You,” SmartMoney.com, 7/7/10) 

• Individual Income Tax Rates Will Increase Under Obama’s Plan. “You may have been led to believe that only individuals in the top two brackets will face higher federal income taxes when the Bush cuts go bye-bye. Not true! Unless Congress takes action and President Obama goes along, rates will go up for everyone — not just a sliver of the wealthiest Americans. The current six rate brackets of 10%, 15%, 25%, 28%, 33% and 35% will be replaced by five new brackets with the higher rates of 15%, 28%, 31%, 36% and 39.6%.” (Bob Bischoff, “How The Expiring Bush Tax Cuts Affect You,” SmartMoney.com, 7/7/10)

Obama’s Income Tax Rate Increase Will Hit Small Businesses That Create 60 To 80 Percent Of New Jobs, “Discouraging” Their “Growth Or Expansion.” “They want to restore the higher, Clinton-era tax rates on the top two individual income brackets, increasing the 33 and 35 percent rates to 36 and 39.6 percent. But these higher rates won’t just hit high wages; they’ll hit business income … Depending on how we define ‘small business,’ these higher tax rates would raise taxes on 45 to 55 percent of small business income … So why should we pay attention to the way our tax code treats small businesses? They are an important source of innovation and risk-taking, creating between 60 and 80 percent of net new jobs, employing over half the labor force … Higher income tax rates reduce the investment spending of entrepreneurs and the likelihood that they invest at all, discouraging the growth or expansion of small businesses.” (Robert Carroll, “Small Business And The Personal Income Tax Rates,” Tax Foundation, 10/28/08)

Obama’s Higher Income Tax Rates Will Stifle Entrepreneurship And Hurt “An Important Source Of Innovation.” “The impact of the higher tax rates on the entrepreneurial sector is also particularly troubling. An often underappreciated feature of our tax system is that roughly one-third of all business taxes are paid by owners of flow-through businesses … when they file their individual tax returns. These businesses are an important source of innovation and risk taking.” (Robert Carroll, “The Economic Cost Of High Tax Rates,” Tax Foundation, 7/29/09)

Sunday, July 18, 2010
Herald News
ON January 19, Chris Christie became the 55th governor of New Jersey. Six months into the job, he has shown that a mixture of confidence, bombast and tenacity can indeed turn Trenton upside down.

As a candidate, he was faulted for a lack of details; critics said he would not be willing to make the hard choices necessary to transform state government. They also said his style of shooting from the hip would
result in legislative gridlock with a Democratic-controlled Legislature. Instead, just the opposite has occurred.

A state budget drastically cutting spending in areas once perceived as untouchable passed the Legislature before the June 30 deadline. The governor’s public campaign for a 2.5 percent cap on municipal property tax increases through a constitutional amendment resulted in a legislative compromise: a 2 percent cap, nearly 1 percent tougher than the cap originally backed by the Legislature.

For all his bluster, when push comes to shove, Christie has shown a willingness to work with Democrats when his objectives can be achieved. In a Thursday meeting with The Record’s editorial board, he praised state Senate President Stephen Sweeney, D-Gloucester, for working collaboratively on the cap.

But caps and cuts come with a price. New Jerseyans will find themselves without many services and programs of value. We do not agree with every cut. We still hope funding for family planning services will be restored. A cut to the earned income tax credit is a tax hike on the state’s poorest citizens. We are
concerned that even if the governor’s so-called “tool kit” of 33 legislative initiatives is quickly made into law, taxpayers will still face a large spike in their tax bills before seeing those bill drop. Less state aid and the caps may eventually result in lowered spending, but existing public employee contracts cannot be voided. For now, less state aid means higher local taxes.

The governor’s ability to communicate his message is, without question, his strongest suit. He has taken full advantage of the power of his office and is using it to force public discussion on a wide array of subjects — school choice, teachers’ benefits, civil service rules, arbitration and now, even school
superintendent salaries.

We disagree with his decision to not re-nominate state Supreme Court Justice John Wallace to the high court. But we believe his chosen nominee Anne Patterson should be given confirmation hearings in the state Senate by the fall.

Over the coming months, we are anxious to hear discussions on the proposed privatization of a myriad of state services. We support less government, but we are mindful that the poor, the disenfranchised, the elderly and the disabled need advocates in Trenton. We cannot, as a state, lose sight of
the values that make New Jersey a desired place to live.

Christie is the quintessential “Jersey guy.” He revels in the give-and-take of politics. His passion for the Garden State is almost contagious. Those are good qualities for the state’s chief executive. There are many battles ahead, but the governor has made an impressive start.

Matt Friedman/Statehouse Bureau

Published: Tuesday, July 06, 2010, 2:16 PM     Updated: Tuesday, July 06, 2010, 4:19 PM

TRENTON — Assembly Speaker Sheila Oliver, the wild card in a compromise between the governor and state Senate to lower the property tax cap from 4 percent to 2 percent, said today she does not plan to “stand in the way” of the agreement.

Oliver (D-Essex), who left the Statehouse Saturday without signing on to the deal reached between Republican Gov. Chris Christie and Senate President Stephen Sweeney, was conspicuously absent from a press conference touting the compromise that afternoon.

“I think that the political reality in New Jersey is that taxpayers want to see some effort made by the Legislature to control property taxes,” Oliver said. “So I don’t think that the General Assembly would stand in the way of that.”

Still, Oliver said Assembly Democrats have concerns they want to address with Christie before he takes any further action, and she is hoping to speak with him today.

“He had his schedule already established for today as did I, but we’re seeking to maybe get together as the day closes out,” she said.

Under Christie’s compromise with Sweeney, the governor plans to conditionally veto a bill the Legislature passed last week that would have lowered the property tax cap but include a number of exceptions. The conditional veto would lower the cap further and only allow municipalities to exceed it for costs from health insurance, pensions, debt service payments and states of emergency. If a town wants to raise taxes above the cap in other circumstances, voters would have to approve it by referendum with a bare majority — 50 percent plus one vote — rather than the 60 percent supermajority Christie first wanted.

The governor’s original proposal was for the Legislature to put a question on the ballot in November that would create a constitutional amendment capping property tax growth at 2.5 percent, exempting only payments for debt service.

 “I think that (Christie) definitely moved very far from his original position,” said Oliver.

Assembly Democrats have come up with several areas they want to address with Christie that they would like to see exempted from the cap: when towns have to go over their reserves for uncollected property taxes; upfront costs incurred by towns that share services or consolidate; special education costs; and if the state makes further aid cuts. Some Assembly Democratic members have also proposed that towns that kept their tax growth below the current 4 percent cap this year be allowed to bank those savings and apply it to next year.

“These are all concerns and considerations, and because we weren’t participating in discussions on a compromise … we were not aware if these considerations were given,” Oliver said, adding that if Christie does not put them in his conditional veto they could explore tackling them through future legislation.

Christie’s conditional veto is expected today or Wednesday. The Assembly Budget Committee is scheduled to meet Wednesday morning, where it is scheduled to discuss the compromise.

Oliver said her refusal to participate in Saturday’s agreement was based on principle.

“Why should I participate in a photo op for something I know nothing about?” she said.

Christie and Sweeney, Oliver said, had already worked out the terms of the deal before she was consulted.

“I wasn’t upset. I won’t call it upset,” she said. “I just felt that the General Assembly as an institution … should have been afforded a little more recognition in terms of the protocol of how government works.”

Christie and Sweeney said Saturday they wanted to move quickly to build on the momentum of Tuesday’s budget adoption.

© 2010 NJ.com. All rights reserved.

June 20, 2010

Democrats hypocritical on millionaires’ tax

Study shows adverse impact of steep levies on the wealthy

How good could this state be if elected officials spent their time working to fix problems instead of trying to one-up their opponents, like kids in a sandbox?

Assembly Democrats will try to override Gov. Christie’s veto of the “millionaires’ tax,” and although they frame it as an heroic effort to provide property tax relief for the disabled and elderly, it is an attempt to embarrass the governor.

As people who have followed this issue know, the Democratic-led Legislature and Democratic Gov. Jon Corzine wrote last year’s so-called “millionaires’ tax” to expire on Dec. 31, which it did. When it died, they knew Christie would be governor in about three weeks and that he was on record as being against any new taxes.

If they had been sincere, the Democrats could have passed a new millionaires’ tax and Corzine could have signed it into law before Christie hit town and figured out which key fits which door in the Statehouse.

Heck, if they really cared about the sad state of economic affairs they would cease with the games and try to get property tax relief for everyone, as Christie is doing with his proposed 2.5 percent cap on tax hikes, something else the Assembly Ds are gaming.

The “millionaires’ tax” bill passed with 46 votes. To override it, they need to have all 47 Assembly Democrats onboard plus seven Republicans, which is not very likely. A veto override was made difficult on purpose; it was last tried in 1997.

One of the reasons Christie gave for not wanting the “millionaires’ tax” or other new taxes is that they drive away from New Jersey the people who create jobs and who have money to spend. That migration is the subject of a Forbes article by Jon Bruner, who analyzed IRS data to find out where the better-off folks are going.

Florida and Texas did well. Here’s what reporter Bruner said:

“The dominance of the list by Florida and Texas — the former has eight of the top 20 counties — the latter four — makes sense to Robert Shrum, manager of state affairs at the Tax Foundation in Washington, D.C., since neither state has an income tax.”

The other political game afoot is stalling passage of the 2.5 percent property tax cap constitutional amendment. The Legislature has to get its work done by mid-July if it is to be on the November ballot.

My colleague Mike Symons asked Speaker Sheila Oliver about that, and she said she wants to take time with it. She said she especially wants to hear from mayors and school districts.

“It’s ironic that Speaker Oliver and Majority Leader (Joe) Cryan are not willing to enact legislation allowing people to decide whether they want control of their property taxes and state government spending, but they will jump through hoops when it serves their political purposes,” said Assemblyman Vince Polistina, R-Atlantic.

More than 200 mayors have endorsed the 2.5 percent plan, which allows exceptions for only debt service or voter override. It also is backed by the New Jersey Taxpayers Alliance, whose tax-fighting president, Jerry Cantrell, said, “Reasonable voices have continuously warned that out-of-control spending and lack of definitive corrective actions were setting the state up for a colossal property tax crisis.”

Spending in many of the 604 school districts, where they routinely hand out generous contracts as if money grows in the Pine Barrens, is a big part of the problem. No need to find out where they stand; they won’t like any restrictions on their ability to raise your property taxes to keep the gravy train on track.