Governor Corzine Presents Financial Restructuring And Debt Reduction Plan To Union County Citizens
Updated Feb. 1 - Download Governor's Slides

Plan will pay down half of state's bonded debt and secure transportation funding for 75 years

CRANFORD - Governor Jon S. Corzine today presented his financial restructuring and debt reduction plan to the citizens of Union County. This unique fiscal proposal represents an opportunity for New Jersey to get back on firm financial footing for the first time in decades while at the same time securing transportation funding for 75 years.

"This financial restructuring and debt reduction proposal will end the era of financial imbalance and fiscal mismanagement once and for all,” Governor Corzine said. “This proposal presents an opportunity to secure our financial future, pay off half of the state’s bonded debt, secure transportation funding for a generation and implement budgeting restrictions to ensure that this never happens again."

The Governor’s financial restructuring and debt reduction initiative calls for state spending for next fiscal year to be frozen at this year’s level, and also ensures that spending will not be able to exceed revenues moving forward. Governor Corzine’s proposal uses the value in New Jersey’s toll roads to pay down 50% of the State’s debt and permanently fund statewide transportation improvements. The financial restructuring and debt initiative would also call for all future debt without a dedicated revenue source to be approved by voters.

In order to capture the value of our toll roads to pay down half of the state’s debt and fund the Transportation Trust Fund for the next 75 years the Governor is proposing scheduled toll increases along the states three major toll roads and on a segment of Route 440. The average trip on the turnpike currently costs $1.21. Under the proposed schedule that same trip would cost $2.05 in 2010, $3.46 in 2014, $5.84 in 2018, $9.86 in 2022 and would be at $12.50 in 25 years.
These transportation funds will pay for critical infrastructure improvement projects, including the Department of Transportation’s plans to reduce congestion and improve safety in Union County. Congestion reduction projects would include the construction of two missing ramps at interchange 142 where the Garden State Parkway meets Route 78 in Hillside and Union Townships. Additional projects include the replacement of the Morris Avenue Bridge in Summit and North Avenue Corridor improvements in Elizabeth. New Jersey’s Transportation Trust Fund will run out of money in 2011, leaving the state with no funding to fill potholes, build roads or safely maintain bridges. The above transportation improvements would be impossible to complete without a stable and dedicated long-term transportation funding source.

Currently, New Jersey has one of the highest debt burdens in the country with $32 billion in bonded debt. This breaks down to a share of $3,700 for every man, woman and child, which is three times higher than the national average. As a result, the first $860 paid in individual state taxes goes directly to interest and debt payments. In addition, New Jersey holds unfunded pension obligations of $25 billion, and $60 billion worth of future health care costs for retirees. This combination of bonded debt and unfunded liabilities translates to a debt of $45,000 per household.

Proving that these issues transcend politics and party affiliation, former Republican Congressman Bob Franks has signed on as Chairman of the Financial Restructuring and Debt Reduction Campaign. Other announced supporters include Congressman Rob Andrews, the New Jersey Chamber of Commerce and 17 members of the Financial Restructuring and Debt Reduction Campaign Steering Committee who represent a broad range of New Jersey perspectives including: business; higher education; gaming; health care; and labor. These Individuals are helping to build support for the Governor’s Financial Restructuring and Debt Reduction Plan all the while reinforcing the fact that this will finally set New Jersey’s finances on the right track.