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Pain of N.J. budget stalemate spreads

State closure order may affect casinos

TRENTON, N.J. -- Atlantic City's casinos were ordered to close by Wednesday, the latest casualty of a state government shutdown that entered its second day yesterday after the Legislature failed to adopt a budget by its July 1 deadline.

The head of the Casino Control Commission ordered gaming in Atlantic City to cease at 8 a.m. Wednesday if New Jersey fails to enact a budget by then.

Atlantic City's 12 casinos, which require state monitoring, have waged a court battle to remain open, and an appeals court was weighing the matter yesterday. There was no word on when a ruling would be made, courts spokeswoman Winnie Comfort said.

Governor Jon S. Corzine said yesterday that there was ``no immediate prospect of a budget" that would spare state parks, beaches, and possibly casinos from having to close in the coming days.

About 45,000 state employees were furloughed Saturday. Corzine's order allows him to keep 36,000 state employees working without pay. Services such as State Police, prisons, mental hospitals, and child welfare were to keep operating.

Corzine met for several hours yesterday with lawmakers as state leaders struggled to end the shutdown, but no agreement was reached. More talks were planned for today.

The governor shut down nonessential government services Saturday after the Legislature failed to adopt a budget by its July 1 deadline, leaving the state without the means to spend money. State parks, beaches, and historic sites were expected to shut down Wednesday .

If the order to close the casinos is upheld, the state would lose an estimated $2 million in tax revenue each day they stayed closed, officials said.

Assemblyman Francis Blee, a Republican whose district includes the casinos, said it was important for workers that they remain open. ``We will have tens of thousands of individuals, real people, that are going to be hurt by this," he said.

The state constitution requires a new budget to be adopted by July 1. Budget talks became heated this year as Corzine, a Democrat, proposed increasing the state sales tax from 6 percent to 7 percent to help overcome a $4.5 billion budget deficit.

Most Democrats in the Assembly and several Senate Democrats oppose the sales tax increase, fearing voter backlash and reserving any tax increase for property tax reform. Assembly Democrats proposed alternatives, some of which Corzine accepted, but the two sides remained $1 billion apart as the budget deadline passed.

The state lottery and road construction projects were among the first operations to shut down after Corzine signed his executive order Saturday.

Corzine was meeting into the night yesterday with top Assembly and Senate leaders. Assembly Budget Committee members were called to the Statehouse and were discussing alternatives to a sales tax increase.

The Senate is scheduled to meet today, and Senate President Richard J. Codey has told senators to be ready to stay in session until a budget is adopted.

``Let's get on with getting this problem solved," Corzine said while touring a State Police dispatch center in Hamilton yesterday, emphasizing he couldn't ``sign a bill that doesn't exist."

Republicans, the minority party in both the Assembly and Senate, have expressed frustration.

``I'm appalled that this reached this stage," said Senate minority leader Leonard Lance, Republican of Hunterdon. ``It is very unfortunate that the Democratic governor and Democratic majorities in the Legislature could not achieve a budget in place by June 30, and now all the people of New Jersey suffer as a result."

Republicans have vowed not to meet with members of the Democrat-controlled budget panel unless it was a public meeting. ``Anything this committee does to resolve this constitutional crisis must be done in full view of the public because they are the ones being harmed by a government shutdown," said Assembly minority leader Alex DeCroce, Republican of Morris.

The Republicans continued to push their plan to balance the budget with $2.2 billion in cuts and no tax increase.

Kurt Aufschneider, executive director of statewide transportation operations, told Corzine the state hadn't had problems with slowly closing road construction projects.

``We're doing as smooth a transition as we can do," Aufschneider said. ``We're trying to close the jobs down safely."

The Assembly Budget Committee's chairman, Lou Greenwald, said members were privately discussing and refining their alternatives to a sales tax increase, though he said they don't have drastically different ideas. He said they also were prepared for marathon meetings.

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