By Robert J. Tartaglia
Stem Cell Bonding Issue Defeated
The result of the November general elections altered the make-up of the Legislature in both houses, as the Senate Democrats now have a 23-17 margin and the Assembly Democrats lost two seats and changed to 48-32.
The big surprise was the defeat of the constitutional dedication of 1 percent of the state sales tax to property tax relief and issuance of $450 million in bonds to fund stem cell research projects. It would seem that taxpayers have spoken, but that will not deter the proponents of stem cell research as Gov. Corzine and legislative leaders said they were going ahead with plans of a separate, previously approved measure to borrow $270 million to build five stem cell research facilities in New Jersey.
Even though the Senate Democrats picked up a seat, a bittersweet loss was that of Sen. Ellen Karcher, D-12. She was defeated by Assemblywoman Jennifer Beck in a race that saw Karcher’s campaign outspend Beck by six to one. Sen. Karcher’s Assembly counterpart, Michael Panter, also lost his reelection, swinging that district back to the Republicans. Districts 1 and 2 went to the Democrats with Assemblymen Van Drew and Whalen moving to the upper house and solidifying a powerful southern voice. Sen. Stephen Sweeney also bested Sen. Paul Sarlo in a heated vote on who would be the next Senate majority leader. Senate President Richard Codey will remain in his position as leader of the Senate Democrats. Current Assembly Speaker Joe Roberts will continue in that role and Assemblywoman Bonnie Watson Coleman remains majority leader. The Senate Republicans replaced long time Minority Leader Sen. Leonard Lance with Sen. Tom Kean Jr. and Assemblyman Alex DeCroce held on to his post as minority leader.
The governor is looking to cut the state’s debt in half by borrowing millions against future toll road increases, according to recent reports. He is looking to raise about $30 billion and use half to pay down state debt. Instead of selling toll roads, he would create a “public benefit corporation” that would allow the citizens of New Jersey to buy the toll roads from the state in the same way a multi-national corporation might. A public benefit corporation is a quasi-government agency that serves a specific purpose, such as the Postal Service. The cash flow would come from the new entity that would oversee the turnpike and the parkway.
An early issue with the plan would be how the finances are structured. The governor is working with the Internal Revenue Service on its tax exempt status. Selling tax exempt bonds could allow the state to raise more revenue, possibly up to 50 percent more. These types of corporations are common in Europe and Hong Kong.
Republicans have been very critical of the secretive plan, as they believe it could triple the tolls on those roads. Corzine and his chief of staff, Bradley Abelow, have publicly stated that substantial toll road hikes were inevitable because the state will run out of money in the Transportation Trust Fund within two to three years. Gov. Corzine will present more details on the proposal next year during budget negotiations.
Family Leave On the Move
A-3812 (Albano/Panter/Oliver/VanDrew), which would require up to 10 weeks of family leave for the birth of a child or the caring of a family member, was due up for a vote in early December in the Assembly Labor Committee, but as of press time, that had not happened. On the Senate side, S-2249 (Sweeney) has passed the Senate Labor and Budget and Appropriations committees. The full Senate has yet to vote on the measure.
NJBankers strongly opposes the legislation and believes this mandate will further tarnish New Jersey’s image as unfriendly to business. It is a Labor-backed bill that will wreak havoc on a small business’s ability to operate in New Jersey. Senate President Codey and Assembly Speaker Roberts admitted the proposal is one whose time is due, but thought the benefit of 10 weeks is far too generous and are looking at cutting back to six weeks. Sen. Sweeney has offered to allow employers with fewer than 50 workers the chance to not guarantee a job upon return from paid leave, yet many of this law’s other supporters may not be willing to offer that concession.
It is not the time for family leave. New Jersey’s serious financial issues far outweigh the need for legislation that would dramatically weaken an already tough business climate. It is imperative that you contact your legislator and express your opposition to A-3812!
New Jersey Department of Banking and Insurance Commissioner Steven M. Goldman, Acting Department of Community Affairs Commissioner Joseph Doria and Sen. Ron Rice recently announced the creation of the New Jersey Home Ownership Preservation Effort (NJHOPE). NJHOPE is a voluntary alliance that includes the New Jersey Bankers Association, The New Jersey League of Community Bankers, The New Jersey Mortgage Bankers Association, The Credit Union League, The Financial Services Association, Neighborworks America, The U.S. Department of Housing and Urban Development, and the New Jersey Housing and Mortgage Finance Agency.
It is a public-private partnership that includes governmental entities, members of the financial services industry and not-for-profit organizations. The goal of the alliance is to raise awareness among consumers who may have purchased subprime products. It will also provide increased access to credit and loan counseling for those who need it and temporary assistance to qualifying consumers who are in immediate danger of foreclosure. To implement these goals, a task force was created that will be an ongoing part of the NJHOPE program.
While the subprime crisis is a serious issue in many states, New Jersey has fared much better than most in terms of dealing with mortgage lending issues. At 4.33 percent, New Jersey is below the national average foreclosure rate of 5.12 percent. NJBankers stands ready with the other trades and the state officials to assist in any way possible. Please contact our office for further details.
The American Bankers Association (ABA) and the Credit Union Strategies Task Force of Pennsylvania have asked a federal court to overturn a decision by the National Credit Union Administration authorizing the creation of a “local” community credit union charter that encompasses most of south central Pennsylvania.
The case, American Bankers Association v. National Credit Union Association, was filed in November 2005 in the United States District Court for the Middle District of Pennsylvania. The ABA filed a motion with the court in November asking for the decision to be vacated. As of press time, briefing on these motions was scheduled for December.
The Action Banker Council was scheduled to meet in December with Assemblyman John Wisniewski, chairman of the Transportation Committee, and member of the Assembly Financial Institutions and Insurance and Appropriations committees. He is also co-chair of the Joint Legislative Committee on Government Consolidation and Shared Services. Assemblyman Wisniewski has been consistently voicing concerns over the governor’s proposed asset monetization scheme. This will be a great chance to meet one of the rising stars of the Assembly Democratic caucus.
With the end of 2007 rapidly approaching, we’re still trying to reach our JebPac goal of $100,000. To date, 33 member banks have contributed a total of $74,397. We need everyone’s support and there is still time to contribute. Remember, JebPac funds help us gain access in the political arena, where interaction with legislators is important in the legislative process. Every contribution given to JebPac allows us to open doors to reach out to legislators.
Robert J. Tartaglia is director of government relations for NJBankers. He can be reached by e-mail at email@example.com.