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Christie

Says his administration balanced "two budgets with over $13 billion in deficits without raising taxes."

Chris Christie on Tuesday, September 27th, 2011 in a speech at the Ronald Reagan Presidential Library

Chris Christie claims he balanced two budgets while facing $13 billion in deficits and didn’t raise taxes

Gov. Chris Christie has some advice for Washington, D.C.: follow New Jersey’s lead.

The Republican said in a speech last week at the Ronald Reagan Presidential Library in Simi Valley, Calif., that the world doesn’t view the United States as it once did, in part because of partisan bickering. But in New Jersey, he said, "you have actually seen divided government that’s working."

"We compromised, on a bipartisan basis, to get results," Christie said Tuesday. "How do we do this? How do we do it? Through leadership and compromise. Leadership and compromise is the only way you can balance two budgets with over $13 billion in deficits without raising taxes while protecting core services."

As Christie mulls a possible bid for the White House, PolitiFact New Jersey looked at his tenure in the Garden State. We found his claim needs a few clarifications.

The $13 billion in deficits includes a $2.2 billion mid-year deficit in the fiscal 2010 budget -- a spending plan approved by his predecessor -- and a $10.7 billion projected deficit for fiscal 2011.

The $10.7 billion figure was the state’s projected structural deficit -- or the difference between the amount needed to maintain spending levels and fully fund every program mandated by state law and state revenues -- for fiscal 2011. The state’s nonpartisan Office of Legislative Services calculated the structural deficit.

Christie, in his fiscal 2012 budget proposal, dismissed the structural deficit as the "old way of budgeting." We’ll address that later.

First, let’s tackle how Christie handled the $13 billion in deficits.

Christie’s plan to handle the fiscal 2010 deficit included "375 line items of cuts, efficiencies and program eliminations," according to a February 2010 news release from the governor’s office. Among those was a $475 million cut in aid to school districts.

The governor tackled the projected $10.7 billion deficit for fiscal 2011 by reducing property tax rebates, school and municipal aid and skipping a more than $3 billion pension payment, among other measures.

New Jersey’s Constitution requires a balanced budget every year. So, Christie did balance both budgets.

But is a budget balanced when the state skips a required payment to the pension system?

"It’s certainly not uncommon for governors to use the word ‘balance’ imprecisely," said Bob Ward, deputy director of the New York-based Rockefeller Institute of Government. "From a private-sector perspective, a budget that simply skips a required pension payment could not be described as balanced. In the context of state government budgets, the claim may be technically correct."

Let’s cede that point to the governor.

But Christie signed another spending plan this summer. What happened to the fiscal 2012 budget?

The Office of Legislative Services projected the fiscal 2012 structural deficit at $10.5 billion.

But, in a February budget speech, the governor said the projected deficit "assumes no one is actually managing the budget or setting priorities. That is yesterday’s New Jersey."

Now, Christie said, "the baseline is zero" for budgeting.

David Rosen, the budget and finance officer for the Office of Legislative Services, said "that’s not an illegitimate way to look at it," but the executive branch appears to be using two different methodologies.

"I don’t know what the right answer is, but it does seem like adding apples and oranges if they are using that calculation for one year and not another," he said.

"In his first year in office, the governor closed more than $13 billion in deficits created because past administrations and Legislatures approved costly programs without creating sustainable sources of long-term funding to pay for them.  This created monstrous deficits," Andy Pratt, a state Treasury Department spokesman, said in a written statement. "We’ve returned to a zero-based budgeting approach that starts on the assumption that we spend within our means and budget based on realistic and sustainable revenues.  Except in theoretical terms, that means there are no longer any deficits to discuss."

Now, let’s tackle Christie’s other point that he didn’t raise taxes. PolitiFact New Jersey previously found that while rates for the state’s three major taxes have remained the same, several experts said at least one of three tax credits programs reduced in fiscal 2011 could represent a tax hike.

Our ruling

The governor said his administration balanced "two budgets with over $13 billion in deficits without raising taxes."

Several experts said cuts to tax credit programs could represent a tax hike.

And while Christie is technically correct that he balanced two budgets with $13 billion in deficits, that figure includes a projected structural deficit. And the governor has since dismissed structural deficits as "the old way of budgeting." He can’t have it one way one year and then change it the next year.

We rate the governor’s statement Half True.

To comment on this ruling, go to NJ.com.

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About this statement:

Published: Sunday, October 2nd, 2011 at 9:28 a.m.

Subjects: Deficit, State Budget

Sources:

Gov. Chris Christie’s speech at the Reagan Library, Sept. 27, 2011

Email interview with Michael Drewniak, spokesman for Gov. Chris Christie, Sept. 29, 2011

Interview with David Rosen, budget and finance officer for the Office of Legislative Services, Sept. 29 and 30, 2011

Email and phone interview with Andrew Pratt, spokesman for New Jersey Department of Treasury, Sept. 30, 2011

Email interview with Bob Ward, deputy director of the Rockefeller Institute of Government, Sept. 29, 2011

Interview with Ben Dworkin, director of the the Rebovich Institute for New Jersey Politics at Rider University, Sept. 29, 2011

Interview with Arturo Perez, fiscal analyst with the National Conference of State Legislatures, Sept. 29, 2011

Office of Management and Budget, Fiscal 2011 Budget in Brief, March 16, 2010

Office of Management and Budget, The Governor’s FY 2012 Budget Summary, Feb. 22, 2011

Office of Gov. Chris Christie, FY2010 Budget Solutions as a Foundation for Reform, Feb. 11, 2010

The Star-Ledger, N.J. budget experts say Christie's 'new normal' approach on deficit is 'old,'March 1, 2011

Office of Legislative Services, Estimate of Fiscal Year 2012 Structural Deficit, July 12, 2010

Center on Budget and Policy Priorities, States Continue to Feel Recession’s Impact, June 17, 2011

Stateline, State budgets explained: Why deficit figures don't always add up, April 5, 2011

Office of Gov. Chris Christie, Transcript of the Governor Christie’s Opening Statement at the FY2012 Budget Press Conference, June 30, 2011

Office of Management and Budget, Fiscal 2010 Budget in Brief, March 10, 2009

The Star-Ledger, Gov. Christie's prepared 2011 budget remarks, Feb. 22, 2011

Office of Gov. Chris Chrisite, Governor Christie Delivers Budget Address, Feb. 22, 2011

PolitiFact New Jersey, Gov. Chris Christie says the New Jersey budget doubled property tax credits and had no new tax increases for the second consecutive year, July 24, 2011

Written by: Erin O'Neill
Researched by: Erin O'Neill
Edited by: Caryn Shinske

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