TRENTON — Senate President Stephen Sweeney, the burly labor leader who is the Legislature’s top Democrat, strode into Republican Gov. Chris Christie’s office to hand-deliver two bills to the rookie Republican. With cameras rolling, Christie pulled out his pen and vetoed the measures, which would have increased taxes on millionaires and used the money to pay for property tax...
Gov. Chris Christie joked about his friendship with Senate President Steven Sweeney on Saturday as they announced a 2 percent property tax cap deal. TRENTON — Senate President Stephen Sweeney, the burly labor leader who is the Legislature’s top Democrat, strode into Republican Gov. Chris Christie’s office to hand-deliver two bills to the rookie Republican. With cameras rolling, Christie pulled out his pen and vetoed the measures, which would have increased taxes on millionaires and used the money to pay for property tax rebates for seniors and the disabled.
Sweeney vowed he would not give up the cause: "We’ll be back, governor." Christie smiled and promised to stand firm.
But behind the scenes that May night, the fight was already over. Christie would keep Republicans unified against the tax, and Sweeney could not force it into the budget.
Christie had won the first major battle of his administration, leaving political opponents who control the Legislature with little ammunition to wage war against his austere budget. They would accept his terms — and his way of doing business.
"Someone said to me, ‘He killed you,’ " Sweeney (D-Gloucester) later said in an interview. "I said, ‘No, he didn’t kill me. I was in a situation before we started that I couldn’t win, and I made the best of it.’ "
The journey to the $29.4 billion budget Christie signed last week — and the intersecting drama over property taxes that continued Saturday — was a coming-of-age for Trenton’s new crop of leaders, Republican and Democrat, as they navigated a fiscal crisis and avoided a government shutdown.
Interviews with more than two dozen participants involved in the budget reveal a process peppered by rookie mistakes, unexpected twists and blunt talk in the Statehouse’s first year of fully divided government since Jim Florio was governor.
At one point, with victory in sight, the governor and his allies in the Legislature nearly lost their edge when key senators unexpectedly balked. One Republican lawmaker now concedes he considered quitting rather than voting for Christie’s budget.
At another point, Christie showed political agility that surprised his own staff by using his enemies in the teachers union as a foil to divert attention from school funding cuts.
Sweeney, stressing compromise within his own party, was impressed by Christie’s ability to make quick decisions and understand the wide-ranging powers of the New Jersey governorship. But Sweeney said he used what he learned from the budget talks to hang tough in the battle with Christie on how to cap property taxes.
Some officials interviewed for this story requested anonymity when discussing sensitive matters. They agreed it was a critical test for a new Republican governor elected in a solidly Democratic state.
"We have never seen the likes of Chris Christie before," said Sen. Kevin O’Toole (R-Essex). "Everyone acknowledges we made mistakes. (But) the training wheels are off."
QUICK TO DECIDE
Christie ran for governor on a broad promise to stop the runaway spending of state government, but refused to give specifics. An attorney and former federal prosecutor, he lacked the number-crunching expertise of his predecessor, Democrat Jon Corzine, the former Goldman Sachs CEO.
What Christie knew how to do was decide.
Three times a week in the days leading up to the March 16 budget address, his senior team gathered in the office of Treasurer Andrew Sidamon-Eristoff, a veteran New York City budget official and a Trenton newbie. Like career prosecutors laying out evidence, they presented budget items line by line.
"I found the budgeting thing to have been most analogous to the way I operated as U.S. attorney," Christie said in an interview. "The same way in the Treasurer’s Office, they would lay out ‘here’s the thing, here’s the opposition you’ll hear, here’s the people who will be affected, here’s how many people will be affected.’ At the end, they’d say to me, ‘What do you want to do?’ "
When his advisers squabbled or belabored an issue, Christie had a simple signal: "Move on." Once, when that didn’t work, he said louder: "Adios."
The result: a tough spending plan that sought to close a huge deficit with unprecedented aid cuts to schools, the end of rebates and calls to stem spending at all levels of government.
DEALS AND SURPRISES
Sweeney had captured the Senate presidency by ousting Sen. Richard Codey (D-Essex), a wily Statehouse veteran who gained fame as the accidental governor replacing Jim McGreevey. To balance a South Jersey Democrat leading the Senate, a deal was cut to make Sheila Oliver (D-Essex) the Assembly speaker.
"It was felt and anticipated that I would simply walk lockstep with the Senate president," Oliver said in an interview. But it quickly became apparent that was not the case. Oliver staked out a decidedly more deliberate pace than Sweeney and refused to automatically go along.
An ironworkers union leader on hostile terms with New Jersey’s public sector unions, Sweeney initially found much more common ground with Christie — too much, complained some Democrats. But on the issue of taxing the rich to boost a cash-strapped budget — specifically, reinstating a just-expired income tax surcharge on people making more than $400,000 — they were worlds apart.
In their frequent private conversations, Christie kept saying he wouldn’t budge. And Sweeney would just laugh.
"I just didn’t think anyone in their right mind would do something like that," Sweeney said later, still adamant that it was bad policy and bad politics. "It was wrong."
Frustrated by Christie’s rhetoric that the tax would hurt small business owners along with the wealthy, Democrats devised what they thought was a compromise — tax true millionaires, and use the money for senior and disabled taxpayers who needed it most. Christie, who never intended to sign any such tax, was angered more by the timing of the Democrats’ announcement: a half hour before he officially rolled out his "Cap 2.5" property tax reform agenda that opened up a second front in his war with lawmakers. He wasn’t happy with Sweeney springing it on him, and in private Christie made sure he knew it.
DROPPING A BOMBSHELL
As the millionaires tax debate simmered, Democrats held hearings to highlight the impact of Christie’s far-reaching cuts to education, social programs, even services for the blind. But attention fixated on a different spectacle: the governor’s nasty and colorful fight with the New Jersey Education Association, the powerful teachers union that became Christie’s favorite target.
The union and its allies marched on Trenton in record numbers on May 22 to show their anger at Christie, who called on teachers to freeze their pay. But with most Democrats staying far away, it had little impact on the budget.
What mattered more happened on April 12. Just before a planned meeting with NJEA president Barbara Keshishian, Christie was asked at an unrelated press conference how residents should treat any school budget without a teacher wage freeze. He urged them to vote it down.
It was an off-the-cuff statement that blindsided his staff. Behind him, Lt. Gov. Kim Guadagno gasped.
When voters rejected a record 58 percent of school budgets, Christie claimed a mandate for his cost-cutting agenda. Democrats who suspect the comment wasn’t at all unscripted — "It wasn’t even a little bit by accident," said one — knew Christie had all the momentum.
By the time Sweeney walked the millionaires tax to the governor’s desk on May 20, they had abandoned hope he would crack. They later went ahead with an anticlimactic veto override attempt — even as they were negotiating a budget deal that did not include the tax — in part to make GOP lawmakers sweat for backing their governor’s unpopular stance.
"I knew it was DOA. I was never under false illusions," Oliver said. "But that does not mean that politically that road should not be pursued."
A TOUGH SELL
Democrats were left with a budget they wanted no part of. If they presented Republican Christie with major changes, he could veto them and Democrats didn’t have enough votes to override him. An impasse on the budget at the July 1 deadline would force a state shutdown — something neither side wanted. So they agreed to an unprecedented arrangement: Democrats, the majority party, would provide just enough votes if Republicans owned the budget by sponsoring it and unanimously voting yes.
Riding high, Christie expected Republicans to be firmly behind his budget. He was wrong. In the Legislature, the minority GOP also showed it was not accustomed to having power.
Soon after his March 16 budget address, Christie summoned GOP lawmakers to the governor’s mansion and delivered the same speech he gave his cabinet: "We’re not going to apologize for this budget, we’re not going to rationalize this budget. We’re going to fight for it and we’re not going to give an inch."
But on June 21 — nine days before the deadline to avoid a shutdown — cracks began to show. As the GOP began lining up votes for the budget and supporting bills — responsibilities handled by Democrats for the past eight years — some lawmakers balked, saying they opposed fee hikes and cuts to school aid that landed disproportionately on their suburban districts. Several who committed to support Christie’s budget were unaware that also meant they needed to vote for fee-hike bills.
Text messages flew back and forth with Christie’s office, describing mutiny inside the Senate Republican caucus.
"Was there panic? No, there wasn’t panic," O’Toole said. "Was there deep concern? Yeah."
It was quickly decided the governor had to get in the game. That Friday, three days before the final budget vote, Christie met privately with Sens. Diane Allen (R-Burlington), Jennifer Beck (R-Monmouth) and Michael Doherty (R-Warren).
Doherty, who came on board after Christie agreed to kill a $5 million fee increase on small businesses, was enlisted to help persuade two conservative Assembly members who had declared they would oppose the budget: Michael Patrick Carroll (R-Morris) and Allison McHose (R-Sussex). Doherty’s actions enraged Steve Lonegan, the conservative activist who lost to Christie in last year’s GOP primary and remains a harsh critic.
Stung by Lonegan’s remarks, Doherty said privately: "I thought he was my friend. I guess he thought he was my boss."
Doherty worked the phones, even enlisting Marie Tasy, who leads the state’s largest anti-abortion group, to warn Carroll and McHose Democrats would demand $7.5 million in family-planning restorations if they were needed to supply two more votes.
Monday, the recalcitrant Assembly members met with Christie for the final sell. Both voted yes despite profound misgivings about the cuts to suburban schools. Carroll said he even considered quitting and may not run for re-election because of his vote.
While Carroll and McHose did not get any sweeteners for their vote, the GOP senators’ $5 million concession caused headaches for Sweeney and Oliver, who’d secured money for some Democratic priorities under the deal with Christie to provide the votes. Their members now wanted to know why they couldn’t get more.
"It’s too far down the field, and not enough people were involved in the deal," Codey grumbled outside the caucus room.
Sweeney emerged, feeling the backlash. "Show me the money," he said. "It doesn’t exist."
Later that week, Sweeney called it an example of Christie’s built-in advantage as governor. "I make decisions and I try to build consensus. Chris makes decisions and runs with them," Sweeney said, adding that he was "amazed" at Christie’s control over Republicans: "They did exactly what they were told." Democrats used to "fight like hell" with Corzine, he said. With the votes finally in line, the Legislature signed off on Christie’s budget, but not before Democrats blasted it for hours on the floor of both houses. As the Assembly debated en route to a vote at 1:13 a.m. Tuesday, Christie watched on TV while playing nickel-ante gin and poker in his office with the lieutenant governor and a handful of key aides.
Democrats believe the tough budget will backfire on Christie, but they give him points for standing his ground. "My biggest regret is sitting back and not being more aggressive" in the budget fight, Sweeney said. He added that he showed Christie he was no pushover when the governor was forced to compromise on tax caps. "I was not going to let (Democrats) be chastised and talked down to, and we weren’t," Sweeney said.
Twelve hours after the budget passed, Christie signed it and began pounding away at the property tax issue — acting like the winner of a prizefight anxious for the next bout.
"It’s the first time I’ve ever done this," Christie told lawmakers in their conversations about the budget last week. "Listen, I’m going to get better at this."
Staff writers Josh Margolin, Lisa Fleisher and Matt Friedman contributed to this report.