Thursday, July 01, 2004

Part II

We lost the suit, but it will go on to supreme court. It's a groovy thing that we have those 500 faxes into this blasted office supporting the lawsuit. Blech.

Amanda's shoe is missing and I'm not the one who swiped it. Who steals ONE stiletto heel? Not I.

HEADLINE: Judge sides with governor on borrowing plan

BYLINE: JOHN P. McALPIN, Associated Press Writer



Borrowing $2 billion to balance the state budget is legal because the New Jersey Constitution gives the governor broad powers to determine where the money should come from, a state judge ruled Thursday.

Gov. James E. McGreevey and Democratic lawmakers need the loan and about $2 billion more from higher taxes and fees to balance the $28 billion budget he signed Wednesday.

Republican lawmakers, without enough votes to scale back the record spending, filed a lawsuit claiming the loan violates state laws requiring a balanced budget. Proceeds from the loan will be used to cover state operating expenses in the coming year.

McGreevey raised taxes on cigarettes and boosted surcharges for bad drivers, guaranteeing that the money will be used to pay back the loan over the next 20 years.

Superior Court Judge Linda Feinberg said Thursday she struggled with the GOP argument but ultimately decided that it was permissible because the law broadly defines revenue.

Unlike an accountant or homeowner, the governor can label money coming in from a loan as revenue rather than a liability.

By adding the proceeds of the bond sale to the incoming taxes and fees, the state will have enough money to cover expenses for the year.

"There is no hole there," Feinberg said.

Republican lawyers said they planned to appeal immediately and expect it to go to the state Supreme Court.

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