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Bruised by 2017 shutdown, merchants brace for repeat

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3C's Luncheonette in Seaside Park lost about $7,000 in business as a result of last year's government shutdown.
3C's Luncheonette in Seaside Park lost about $7,000 in business as a result of last year's government shutdown. - ()

For decades, Gail Coleman and her family called Seaside Park, a sleepy shore town along the Barnegat Bay, their home.

Just after the World War II, Coleman’s grandparents bought a small chunk of property off the borough’s only main road, opening up a bait and tackle shop. With her late brother and mother, Coleman took over the property 28 years ago and turned it into an eatery called 3C’s Luncheonette.

The restaurant sits on one of the narrowest points along the Barnegat Peninsula between Atlantic Ocean on one side and Barnegat Bay on the other. Overshadowed by the much larger Seaside Heights resort town with its own array of boardwalks, Seaside Park depends on Island Beach State Park just to the south to draw in businesses.

“Without Island Beach, half our businesses wouldn’t even be there,” said Coleman, a borough councilwoman of seven years.

So when a budget impasse in Trenton caused the state government to shut down at the beginning of last year’s July 4 holiday weekend, Coleman was none too pleased.

“They didn’t help us, they hindered us,” she said.

This year, lawmakers in Trenton are considering a bill that would keep the state’s beaches and parks open in the event of another government shutdown.

Senate Bill 835 passed out of the Environment and Energy Committee on May 21, and was referred to the Budget and Appropriations Committee that same day. Its counterpart in the lower house, Assembly Bill 1237, sits in the Agriculture and Natural Resources Committee. It keeps state parks, beaches and their surrounding communities shielded from the politics.

“This is very similar to the 2008 law that keeps casinos open during the shutdown,” said Assemblywoman Valerie Vainieri Huttle, D-37th District, a sponsor of A1237.

Under former Gov. Jon Corzine, the government shut down for a week in 2006, shuttering Atlantic City’s casinos and causing the city to miss out on tens of millions of dollars in revenue it would have received during the extended July 4 weekend. Roughly 36,000 casino workers were placed on leave as a result.

“The timing was very unfair,” Vainieri Huttle said.

From showdown to shutdown

Gail Coleman's luncheonette lost $7,000 due to last year's government shutdown.
Gail Coleman's luncheonette lost $7,000 due to last year's government shutdown. - ()

The most recent shutdown occurred a year ago when then-Gov. Chris Christie wanted the fiscal 2018 budget to include $300 million that was to be diverted from Horizon Blue Cross Blue Shield of New Jersey’s reserve fund.

Days before the shutdown, Republican Christie said if the Democrat-controlled Legislature sent him a budget without the $300 million from Horizon, he’d line-item veto virtually every proposal on the Democrats’ wish list. Then-Assembly Speaker Vincent Prieto, a Democrat, said he wouldn’t schedule a vote on Christie’s budget in the lower house of the Legislature.

And so the two Trenton power players were on a collision course, and it sent the government into a shutdown that lasted through the weekend. Shortly after midnight Saturday, July 1, Christie ordered all non-essential services to cease operations, including state parks.

On a given day, Island Beach State Park can draw upward of 10,000 cars, bringing in thousands more people, according to Paul Cassidy, who works at the nearby Right Coast Surf Shop.

But as the park was shut down, all incoming traffic was turned away by police roadblocks.

“We lost like half the business,” Cassidy said, calculating at least $12,000 worth that weekend.

Coleman said her luncheonette lost about $7,000, and her staff of about a half-dozen, mostly students who would work weekend hours for extra income, had to be sent home.

Christie ended up signing a $34.7 billion budget in the early hours of July 3, ending the shutdown with his plan to raid Horizon’s reserve fund never realized. By then, many beachgoers had cancelled their plans to head to the park, while the ensuing turnout of tourists paled in comparison to what the borough would have gotten under normal conditions.

“The kick in the ass was that we couldn’t have had better weather,” Cassidy said.

'Numb to the madness'

The talk around Trenton is the government could indeed shut down again at the start of the 2019 fiscal year, this time under first-year Gov. Phil Murphy, a Democrat.

Murphy’s proposed $1.6 billion increase in revenue has been a tough sell. The Democratic leadership hasn’t entirely been on board with a potential millionaires’ tax or the prospect of raising the sales tax back to 7 percent.

Pushback has come from the likes of Assembly Speaker Craig Coughlin, D-19th District, and Senate President Stephen Sweeney, D-3rd District.

An opponent of the millionaires’ tax, Sweeney is calling for the state’s top-end corporate tax rate to be increased from 9 percent to 12 percent for businesses earning more than $1 million.

Sweeney believes the state can collect about $650 million from the move and says the money should be used to make funding for local school districts more equitable and boost aid for special education, public preschool and other services.

The Senate president has said he’s willing to stand firm in budget negotiations if his fix isn’t adopted.

The Murphy administration already appears to be preparing for the worst. Treasurer Elizabeth Muoio on June 1 announced a freeze on all state hiring and discretionary spending, citing “extraordinary fiscal challenges” stemming from “structural imbalance” in the general fund.

“I’m numb to the madness of it all. I mean, that’s insane. We’re going to shut down again, kick the little people.”

Gail Coleman, 3C’s Luncheonette

In response, Sweeney suggested the freeze and a concurrent memo from Murphy were the result of “inexperience” on the part of the administration.

“To see a memo go out June 1 [saying] ‘prepare for shutdown’, you’re basically saying ‘I give up, you’re not going to get it done,” Sweeney said, adding Christie didn’t send out a similar memo last year until June 29.

Sweeney said he supports S835 as a way to protect businesses in the event of a shutdown.

“There shouldn’t be any inconvenience to people’s quality of life for the fact that we can’t agree on a budget,” he said.

The measure, according to Sweeney, is slated to appear before the Budget and Appropriations Committee, which is holding weekly meetings until the end of June.

Murphy’s office declined to comment on S835, citing a policy to not discuss pending legislation. But his office remained confident a budget resolution would be met before the June 30 deadline.

Meanwhile, back at Seaside Park, merchants are finding it hard to shake the effects of shutdowns past.

“We’re in an era of total lack of cooperation,” lamented Lou Purcaro, a manager at Luna Mar Motel in Seaside Park.

The motel was badly hurt during last year’s shutdown, as visitors to the state park tend to be day-trippers. Now, the seaside town is braced to take another hit in the event of a repeat this year.

“Schools will be out soon, and they stand to lose millions of dollars by doing that,” Purcaro said.

3C’s Luncheonette’s Coleman laughed at the prospect of a second consecutive government shutdown.

“I’m numb to the madness of it all,’ she said. “I mean, that’s insane. We’re going to shut down again, kick the little people.”

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Daniel J. Munoz

Daniel J. Munoz

Daniel Munoz covers politics and state government for NJBIZ. You can contact him at dmunoz@njbiz.com.

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