N.J. Battles Budget On July 4th

Gov. Jon S. Corzine urged lawmakers Tuesday to compromise on his plan to increase New Jersey's sales tax and approve a budget, which would end the government shutdown that threatens to extend to casinos and state parks on Wednesday.

"Make no mistake, people are being hurt and unfortunately more will be hurt in the days ahead," the governor told lawmakers during an unprecedented Independence Day holiday special session.

The session came three days after Corzine started shutting down state government because lawmakers missed the July 1 constitutional deadline to approve a new budget. Without a budget, the government cannot spend money.

"All of us surely believe this circumstance must end," said Corzine, a first-term governor and former U.S. senator and Wall Street executive.

Legislative leaders, speaking after Corzine's address, said his speech was not likely to resolve the stalemate right away. If no deal is reached, state parks and historic sites would close Wednesday along with Atlantic City casinos, which are required to have state regulators on duty.

The state lottery, road construction, motor vehicle offices, vehicle inspection stations and courts have already closed. More than half the state work force — 45,000 people — was ordered to stay home on Monday.

The dispute between the governor and his fellow Democrats who control the Legislature centers on his plan to increase the state sales tax from 6 percent to 7 percent to help overcome a $4.5 billion budget deficit for his $31 billion spending plan. The proposal would cost the average New Jersey family $275 per year, according to experts.

"No one is seeking to increase taxes because they want to," the governor said during his speech, as he detailed years of mismanagement of the state's revenues.

Corzine urged the lawmakers to approve a compromise offered by Senate President Richard J. Codey that would use half the $1.1 billion raised by his sales tax increase to ease the state's property taxes, among the nation's highest.

"I'm willing to meet the Legislature half way," Corzine told lawmakers.

He said the Legislature should keep working until a spending plan is approved. "We must stay here until we meet our constitutional obligations," he said.

State regulators have ordered the casinos to close at 8 a.m. Wednesday.

"When they shut down, then there's no tourists, no conventions, no money for the workers. That's not good," said Ann Ji, who runs a beauty supplies store one block from the casino strip.