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A Modest Proposal to the Governor For Preventing the Institutions of NJ from being a Burden the Taxpayers and for Making them Beneficial to the Public.

Governor Christie is pushing cuts in state funding for the City of Trenton, including eliminating the Capital City Aid program.  Meanwhile state budget officials and legislators are struggling to balance the budget – and everybody thinks if we can just get through this next year things have got to improve.

There is a solution that addresses both state funding for the City of Trenton and the state budget crisis.  It’s actually quite simple: just sell all the state office buildings in Trenton to the highest bidder.  The buildings can be sold subject to a long-term lease to the state, so state agencies remain in their current buildings.  Purchasers have guaranteed revenue, and if Republicans structure the deal right, also have guaranteed profits.  Private equity funds will jump at the opportunity.

I’m usually opposed to privatization of governmental functions and services.  But given that Governor Christie evidently intends to abandon historical – and completely reasonable and justifiable – obligations to the City of Trenton, then I say let’s call Christie on Republican philosophy.  Privatize the billions of dollars of state office buildings in Trenton.  It’s a win-win for everyone – and state government can continue to ignore Trenton with impunity.

The results are obvious – state government gets cash up front to spend on whatever it wants, purchasers of the buildings have guaranteed revenue streams (and profits) from the state as a tenant, and because the buildings are now privately owned, Trenton gets lots and lots of property tax payments.  With luck, the City of Trenton will get enough in consistent and recurring revenue to actually intelligently plan and budget.

Presumably the buildings are worth somewhere between about one and three billion dollars.  Sure, the state will have to pay rent.  But what’s a little rent (or even a couple hundred million dollars a year in rent) when the state both gets fair market value for the buildings and gets out from under its obligations to the City of Trenton?  And since Governor Christie evidently supports making the rich even richer, state government could sweeten the pot by providing some sort of special tax relief to purchasers of state buildings.  The only caveat – they pay property taxes at the full rate with no abatements or reductions.

It might be argued that privatization is bad government policy, and that it’s better (and cheaper) to own than to rent.  Recent imbroglios surrounding private prisons illustrate limitations to privatization of intrinsic governmental functions.  But this proposal is simply to get cash out of doubtless appreciated, but not revenue generating, real estate.  Taxation and Revenue will still operate out of its not particularly attractive building at 50 Barrack Street.  The only change is that some private equity fund will own the building.

For sentimental reasons, the state could decide to keep a few buildings, like the New Jersey State Capitol Building and the War Memorial.  Heck, maybe we could keep everything built before about 1950.  But all the state office buildings constructed in the 1970’s through the 1990’s should be sold – and given that virtually all are an aesthetic embarrassment, good riddance.

Of course, it may well be that the Governor has another plan in mind, and squeezing the City of Trenton past the fiscal breaking point somehow fits in his plan.  I say we call his bluff and find out.  Let’s sell state government to the highest bidder!

To avoid this we as Trentonians (and forget the current administration for a minute) need to recommend a treatment plan that the state can live with.   Citizens can form this plan and with the backing of enough of the serious candidates for Mayor and Council, Gov. Christie will take our commitment to “budget recovery” seriously.  But first the patient has to want to be healed.

Some of our political candidates refuse to accept that the budget is overwhelming priority in this campaign.  They need to be identified and flatly rejected by voters of good conscious in Trenton.

A serious minded plan from Trenton will include carrots and sticks and will have three main parts.

Define the problem: What is the sustainable amount of funding the state should provide to compensate for the footprint it has in Trenton?  How much school funding is jeopardy? How much of a structural deficit gap does that leave us to fill?

Trenton’s Plan of Action: To what schedule will we commit to increase our revenue and reduce expenses in order to close the structural gap?  What are our major tactics to do so?  How should our efforts be supervised (we don’t have such a good track record)?  Which shared services, including schools, need to be on the table?

Make the alternatives clear: What will Trenton’s negative reaction be towards not accepting our plan?  Will we cut off police and fire protection in downtown Trenton?  Will we file lawsuits?  We will march on the capitol?

The writing has been on the wall for years but we have been blind to the signs.  Let’s hope we as citizens and our political leaders are taking the Governor seriously and are up to the task of getting clean of state charity.

The Citizen’s Budget Committee is pursuing development of such a plan.  Gov. Christie’s threat adds fuel to our fire.