2006 New Jersey State Government Shutdown - Post-shutdown Governmental Action

Post-shutdown Governmental Action

To restore government services, on July 3, 2006, Corzine signed an executive order calling for an unprecedented Independence Day session of the General Assembly to work on presenting him with a budget. Immediately after listening to the governor's speech, the legislature voted by voice vote to adjourn the session. The General Assembly met again, without proposing a budget, the following day.

Meeting on the third day of the special session, Democratic factions within the General Assembly reached a compromise budget. That tentative budget proposed an increase in the state sales tax from 6% to 7%, which was estimated to generate an additional $1.1 billion in revenue. The plan also included a requirement to use half of that for direct relief toward New Jersey's property tax—highest of all states. The plan also called for the same dedicated purpose for all of the money raised by this sales tax increase in subsequent years. The new budget law included a provision for a constitutional amendment which was required, like all such amendments in the state, to be approved in an Election Day referendum. On November 7, 2006 New Jersey voters approved this measure by a two to one margin statewide.

Early in the morning of July 8, 2006, both houses of the legislature passed the proposed budget. At 6:00 am that day, Corzine signed executive order number 19 to restore government services. The casinos in Atlantic City opened for business at 7:00 am Remaining government services, including race tracks and the state lottery, also reopened on July 8, 2006. State courts and motor vehicle offices resumed normal operations on July 10, 2006, fully ending the shutdown.

Corzine used his line-item veto authority to reduce the budget by over $51.3 million by eliminating or reducing over 50 spending items.