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July 3, 2006 - New Jersey.

Numerious non-essential state services have been shut down indefinitely from July 1. These include road work, the New Jersey Lottery, and the Motor Vehicle Commission, with Atlantic City casinos and racetracks (which require state monitoring) and public beaches and parks closing after the Fourth of July.

As a result of Articel VIII, Section II, paragraph 2 of the New Jersey State Constitution, the state is required to determine all debts for "as far as can be ascertained or reasonably forseen" and provide for them in a single budget act. As the 2005-2006 Fiscal Year for the state ended with June 31 and the 2006-2007 budget has not passed the state is blocked from expending any money, also by VIII, II, 2. The current ascertainment shows the state ending up in the red by 4.5 billion USD.

The main cause of the problem is a furious deadlock between the Democratic majority is the New Jersey General Assembly, the lower house of the w:New Jersey Legislature which is given the power of starting the budget, and the Democratic Governor of New Jersey Jon Corzine. The main concern in Corzine's plan to raise taxes, such as the sales tax. The Assmebly majority dislikes this, and some in the New Jersey Senate (which has the power to block the budget) also disagree with his measure.

Originally the racetracks would close with the state lottery, however a court order has kept them running past the 4th. The casinos are attempting to get a similar exemption. "Critical" services like the New Jersey State Police, the state's prisons, hospitals and such will continue to operate without funding. All non essential employees of the state were given leave from July 1st on.

Members of both houses of the Legislature have been kept in the capitol, Trenton, to help a speedy passage.

A similar situation occured in Minnesota exactly one year ago as the Legislature failed to pass the budget before they were forced to adjourn by a hard wired date in the state constitution.

Sources

• Associated Press "Budget dispute shuts down New Jersey". CNN, Saturday, July 1

• New Jersey Constitutional Convention, 1947 "New Jersey State Constitution". New Jersey, January 1, 1948

• Angela Delli Santi "Gamblers become early casualities of New Jersey budget shutdown". Newsday, July 2