New York Local News

TRENTON (AP) ― Gov. Jon S. Corzine on Tuesday proposed major budget cuts to key New Jersey programs, including state workers, property tax rebates and aid for towns and hospitals, calling it an agonizing bid to revamp troubled state finances.

"Frankly, New Jersey has a government its people cannot afford," Corzine said in remarks prepared for delivery to the Legislature. "The budget I present today declares the time of living beyond our means is over."

The $33 billion budget proposes $3.2 billion in cuts as Corzine looks to right state finances plagued by annual budget deficits, high taxes and mounting debt. Corzine called his plan "cold turkey therapy for our troubled spending addiction."

"I am pained by the stress and anguish brought to our people's lives by the cuts proposed," the Democratic governor said. "We are positioned between a rock and a hard place."

Under the proposal:

-- Property tax rebates would be eliminated for households earning more than $150,000, reduced for households earning between $100,000 and $150,000 and sliced for renters.

-- State aid for hospitals, towns and cities, and colleges and would be cut.

-- State workers would be laid off and offered retirement incentives, and the agriculture, commerce and personnel departments eliminated, with the goal to cut the 80,000-member work force by 5,000 workers.

-- Motor vehicle agencies and state parks would have their hours cut.

-- A co-payment would be implemented for Medicaid services.

"Failing to take on the tough choices will only force New Jersey into a deeper fiscal swamp and weigh down our taxpayers with more unbearable financial burdens," Corzine said. "That outcome is unacceptable."

The plan needs legislative approval. The state Constitution requires a budget be adopted by July 1. State government closed for a week in 2006 when that deadline was missed amid a dispute between Corzine and lawmakers over tax increases.

Corzine also wants to significantly increase tolls on the Garden State Parkway, New Jersey Turnpike and Atlantic City Expressway to pay at least half of $32 billion in state debt and fund transportation.

Although that plan is separate from the budget proposal, Corzine referenced legislative opposition to it and pleaded to find a way to cut debt.

"Fixing the budget problem without addressing debt reduction is a fiction and if we try to do that, we are misleading the public," Corzine said.

The budget cuts were welcomed by businesses.

"We applaud the governor for understanding the seriousness of our fiscal crisis by presenting a budget that, while tough to stomach by just about everyone in this state, will begin to repair the damage," said Joan Verplanck, New Jersey Chamber of Commerce president.

"I see a lot of pain coming down, and that pain is coming down on poor people and middle-class people," said Sen. Ronald Rice, D-Essex.

Carla Katz, president of the largest state workers union chapter, said the cuts would "scapegoat public workers, will hurt middle class families and fail to provide a real solution to the state's fiscal problems."

Republicans want spending cuts but blasted plans to pare rebates.

"What we will not do is be a party to any plan that would lower or eliminate direct property tax relief for middle-class families," said Assembly Minority Alex DeCroce, R-Morris.

New Jersey has the nation's highest property taxes, at $6,330 per homeowner, or twice the national average. The rebates averaged $1,051 last year.

(© 2009 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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