Christie Declares State of Fiscal Emergency

Thursday, Feb 11, 2010  |  Updated 11:58 AM EDT
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Christie Declares State of Fiscal Emergency

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Chris Christie took over as governor Tuesday.

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Gov. Chris Christie declared a state of fiscal emergency Thursday, taking broad steps to close New Jersey's $2.2 billion budget gap.

In his first major budget speech since being elected in November, the Republican governor told lawmakers that the state is in a financial state of crisis and that the current budget is in "shambles."

Christie plans to freeze $1.6 billion in unspent money, including $475 million in school aid, $62 million for universities, and $12.6 million in hospital charity care.

He will also freeze nearly $16 million in unused grant money from the Division of Youth and Family Services and $158 million from the Clean Energy Fund.

Christie told a joint session of the Legislature, "higher spending is the road to ruin," and that the cuts, while difficult, were necessary to keep a balanced budget as required under the state constitution.

"Today, we come to terms with the fact that we cannot spend money on everything we want. Today, the days of Alice in Wonderland budgeting in Trenton end,'' Christie said.

As a result of the withheld school aid, districts will be forced to spend down their surpluses instead of using the money toward property tax relief.

Frank Belluscio, spokesman for the New Jersey School Boards Association, said any cut would affect districts eventually, but school programs probably would not need to be cut immediately under Christie's proposal.

Belluscio said his group was relieved to hear Christie was talking about withholding only $475 million from schools

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