$9.2 million fund sat untouched until Gov. Chris Christie used the money to fill budget gap
Richard Hersh poses for a portrait in his apartment in Collingswood on Saturday. Cable television companies have been paying a tax that was supposed to go into a fund to help lower cable bills for low-income elderly and disabled people. The fund was never created and the money was used to help close the budget gap this year. Hersh, who pays $122 a month for cable and internet, wishes the fund was available.TRENTON — Five years ago, the state promised poor senior citizens and disabled people they could expect help paying their cable television bills under a tax imposed on the cable industry.
Since then, the state has collected a total of $9.2 million from the tax — but not a dime has gone to help low-income cable subscribers.
After Gov. Jon Corzine signed the law creating the fund in 2006, no one ever developed a plan to disburse the money. It sat untouched and accumulating until Gov. Chris Christie drained the fund to help plug a big state budget hole last year, state Treasury Department spokesman Andy Pratt confirmed.
Although the tax money was earmarked for the Cable Television Universal Access Fund, "the money is all gone now," Pratt said. "The money was never used for the intended purpose."
Lawmakers who sponsored the bill said they didn’t know the money never went to needy residents, saying for some, cable TV provides a lifeline to the world. Christie’s critics said it shows a disregard for the needs of New Jersey’s most vulnerable citizens.
"This points up the disastrous effect of foot-dragging on regulation writing," said Sen. Loretta Weinberg (D-Bergen), chairwoman of the Senate Health, Human Services and Senior Citizens Committee who criticized the "bureaucrats that dragged their feet" during Corzine’s term.
"It also points up that Christie has taken more money away from poor people in this budget — a tax earmarked for a special program and he put it into a general fund," Weinberg said.
Collingswood resident Richard Hersh, 67, disabled since a serious car accident in 1994 left him with chronic nerve condition, said he could use a break on his $122-a-month cable bill. He’s considering dropping the TV service and just keeping the internet to save about $40 because he barely meets expenses on his Social Security check. But he would miss it.
"I don’t have much else I can do. I can’t work. I am sort of relegated to staying in my apartment," said Hersh, who was a marketing consultant until the throbbing pain from his condition, reflex sympathetic dystrophy, ended his career.
"That program would have been great," he said.
Laws that earmark money for a specific purpose do not require governors to spend it. For years, governors have tapped a wide range of revenue sources to balance the budget.
"The budget bill supercedes all other bills," Pratt said. "All state revenue goes into the general fund unless voters have passed a referendum and dedicated it" for a specific purpose.
Spending the money was justified by the "unprecedented budget crisis that was faced by this administration that involved cuts in nearly every single program," Pratt said.
Michael Drewniak, a spokesman for the governor, declined comment.
The fund was created under a broader law that imposed regulations when telephone service provider Verizon wanted to break into the cable business. The law requires Verizon and cable companies Cablevision, Comcast and Time Warner to pay a 4 percent tax on revenue, with one-half of 1 percent earmarked for people enrolled in Pharmaceutical Assistance to the Aged and Disabled, a state program providing low-cost prescription drugs.
About 174,000 people belong to PAAD, as it’s commonly known. They qualify if they are single and earn less than $24,432 a year, or married and make less than $29,956.
Stefanie Brand, director of the Division of Rate Counsel, the state’s consumer advocacy agency, said she recalled some agencies were working on rules for the program about 18 months ago, before Corzine left office. Brand said the fund would have filled a void because there are no subsidy programs for cable TV.
"Unlike electric and gas, water and telephone, cable is not viewed so much as an essential service," Brand said.
The average monthly cost for expanded basic service is $61.19, according to the state Board of Public Utilities.
Richard Hersh poses for a portrait with Charlie, his 11-year-old toy Yorkshire Terrier, in his apartment in Collingswood on Saturday. Cable television companies have been paying a tax that was supposed to go into a fund to help lower cable bills for low-income elderly and disabled people. The fund was never created and the money was used to help close the budget gap this year. Hersh, who pays $122 a month for cable and internet, wishes the fund was available. "I wouldn’t give up on this program," Brand said. "We may start to see money flow out in the coming months or years."
Assemblyman Upendra Chivukula (D-Somerset) one of the law’s prime sponsors, called the long-ignored fund "a sad state of affairs." He said he would ask the BPU if it had dropped the ball. "In these economic times, people are struggling, and cable TV is a window to the world."
When asked why the money never got to PAAD recipients, board spokesman Doyal H. Siddell said, "We can’t comment on the actions of the prior administration."
A spokesman for the New Jersey Cable Telecommunications Association declined to comment.
Assemblyman Joseph Malone (R-Burlington) another sponsor, also said he would investigate.
"Having cable TV is like having a lifeline for many people," he added.
The tax currently generates about $3.5 million a year, and it continues to be collected, Pratt said. No decision has been made on whether the Christie administration will dip into the fund again as officials prepare the coming year’s budget. "What they will do will be part of the budget talks," Pratt said.
Sen. Joseph Vitale (D-Middlesex) said the governor should find a way to dole out this money.
"The administration can find money for projects they like, like vouchers and charter schools. Why not for seniors or disabled people to minimize the cost of watching TV?" he said.
Hersh agrees, recalling he once called his cable provider, Comcast, to see if there were any discounts for people with disabilities. "The woman told me you could always discontinue it," Hersh said. "I thought that was a nice, snippy answer to what I thought was a serious question."
"Thought has to be given to who it hurts or benefits by eliminating this program," he added. "If I could bring down my cable bill $30 or $40 a month, it would mean a lot to me."