The claims to watch for in Thursday’s N.J. GOP gubernatorial debate

If Thursday's debate between New Jersey's leading GOP gubernatorial candidates is anything like their first meeting, Lt. Gov. Kim Guadagno and Assemblyman Jack Ciattarelli will be firing off figures and accusations about each other's tax proposals.

Ciattarelli, a businessman from Somerset County, has been looking to gain on Guadagno, the state's first lieutenant governor. While Guadagno, a former prosecutor and Monmouth County sheriff, is the GOP front-runner, recent polling found more than half of Republican voters undecided.

Ciattarelli and Guadagno are the only two Republican candidates to qualify for Thursday's debate, based on public financing.

The debate — their last before the June 6 primary — airs at 8 p.m. on NJTV. With less than three weeks to go before the election, the Inquirer analyzed some of the claims made by the candidates for New Jersey governor.

Guadagno: "Ciattarelli's five-point plan fails for 600 million different reasons. That's the cost of his plan."

New Jersey taxes income of $500,000 and above at 8.9 percent. Ciattarelli told the Inquirer Editorial Board last week that he would add two brackets above that: taxing income of $750,000 to $999,999 at 9.5 percent, and $1 million and above at 10 percent.

Ciattarelli has said that "no one's overall tax burden will increase" under his plan and that he would add the income tax brackets only as part of a "package deal" that would include other changes — such as not taxing gains on home sales, home improvements, or sales of family-owned businesses.

"If I raise your water bill $5, but lower your electric and gas bill $20, isn't that better for everyone?" he said in a recent interview.

Ciattarelli declined to provide an analysis of the effects of his plan but said the nonpartisan Office of Legislative Services has "provided me with different information over the years" about the impact of tax changes.

As for Guadagno's $600 million figure, her campaign has cited a blog post headlined "Jack Ciattarelli Understands State Aid, Budget Crisis."

Ciattarelli on his tax plan: "It balances the ledger."

Among Ciattarelli's proposed tax changes is a 10-year phaseout of the corporate business tax. The state netted $2.3 billion from the tax in the last fiscal year (of $34.5 billion in revenue overall). To close revenue gaps in addition to the income tax increases, he proposes "closing some corporate loopholes." But he hasn't provided details on how the plan would "balance."

Ciattarelli, arguing for school funding change: "Middle-class people in this community are paying through the nose for pre-K, and yet millionaires in Hoboken get to go to pre-K for free." 

As one of the 31 school districts included in the New Jersey Supreme Court school funding ruling Abbott v. Burke, Hoboken receives state funding for public preschool for all 3- and 4-year-olds. While additional preschool funding goes to some districts, it "does not completely allow" for preschool in those communities, said state Department of Education spokesman David Saenz.

David Sciarra of the Education Law Center, which represents a certified class of all students in the Abbott districts, said the problem is lack of funding for a statewide expansion, despite requirements of a 2008 law.

"The fact that there may be some middle-income households who take advantage of preschool programs if they live in Hoboken" is "a positive," said Sciarra, adding that he didn't know whether "millionaire" families were in Hoboken's program. "If you can build more diversity in the public school system in these communities, we should be all for that."

Guadagno on her property-tax relief plan: "It's going to cost a billion dollars. A billion to a billion and a half, depending. ... If a governor goes into office and decides this is his or her number-one priority, then you can find $1 billion." 

Ciattarelli says Guadagno's plan is "based on false savings and phantom revenues." Guadagno says she could find ways to pay for the $1.5 billion plan, including "auditing Trenton." She projects an audit of state government could save $250 million, based on one Republican Gov. Thomas H. Kean did in 1983. "He saved about $100 million," she told the Inquirer Editorial Board this week. (Gov. Christie's budget proposal for the next fiscal year is $35.5 billion.)

Asked whether an audit could work today, Kean said this week, "It depends on how she's going to do it." His administration had private-sector employees do the audit while public workers took a leave to the private sector; Kean called the program "successful."

As for other savings, Guadagno proposed canceling the planned Statehouse renovation — though the state disclosed Wednesday that the Economic Development Authority had already sold $300 million in bonds.

Guadagno also endorsed scaling back business tax-incentive programs, which ballooned during Christie's and her tenure. "It worked, don't get me wrong," she told the Editorial Board of the Grow NJ program. But "it's too rich." Like Ciattarelli, she also proposes curbing public-worker benefits.

Could a governor find $1 billion (or more)? "If you're willing to sacrifice," Kean said.

New Jersey lately has been strapped for cash toward the end of the year. Christie's treasurer said this week that the state would delay funding to municipalities for property tax relief to help fill a $527 million hole in the current budget.