The Shutdown
After the legislature failed to pass a budget by midnight July 1 when the old budget ended, the governor signed executive order number 17 that immediately stopped numerous non-essential government functions, with more to come after the Independence Day holiday on July 4, 2006.
State functions that ceased immediately included the New Jersey Lottery (the interstate Mega Millions game continued although players temporarily could not buy tickets in New Jersey), the New Jersey Motor Vehicle Commission, MVC offices and inspection stations, the New Jersey Department of Education and parts of the New Jersey Judiciary. Approximately 45,000 state employees who were listed as "non-essential" were told to stay home.
Later (post-July 4) shutdowns included state beaches, public parks, historic sites, gambling in New Jersey's casinos in Atlantic City as well as horse racing in the Meadowlands Sports Complex and Monmouth Park Racetrack.
Both of the latter two were due to the official monitors from the New Jersey Casino Control Commission being listed as non-essential. At the time, New Jersey law stated that gambling establishments could not legally operate without state oversight. Originally, the race tracks were scheduled to close with the first wave on July 1, but a State Court order allowed them to close later. The casinos attempted a similar case, arguing that the state monitors overseeing the casinos were not paid by the state but by the casinos themselves, but the appeal was rejected at the New Jersey Supreme Court; therefore they were forced to close.
According to The Philadelphia Inquirer, "New Jersey Transit, prisons, state police, developmental centers, veterans' homes, mental hospitals, health and disease-prevention offices, child welfare, work on transportation safety, response to environmental contamination, inspectors of amusement parks" were not affected by the order to shut down.
Read more about this topic: 2006 New Jersey State Government Shutdown