To the Legislature:

BUDGET MESSAGE.

Pursuant to Chapter 15, Laws of 1916, I am herewith transmitting my recommendations covering the budget of appropriations for the State's fiscal year ending June 30, 1920.

It will be noted that the total recommended is $9,930,806.14, exclusive of certain improvements and additions recommended to the State Capitol plant, contingent State-use developments, the provision for the Newark Normal School and for acquiring right of way for a cross-State ship canal, all of which I will discuss later. This total is an increase of $444,150.29 over the total appropriation of the present fiscal year, amounting to $9,486,655.85, a proportionately small increase in comparison with the extraordinary conditions which the Budget Commission was obliged to meet.

For instance, of this increase $234,664.46 is recommended for the budget of the Department of Charities and Corrections, which now, of course, comprises all institutions in New Jersey, both charitable and correctional. This increase for the Department is largely represented in the continued rising cost of food and supplies; furthermore, the Department is planning to accommodate about 800 additional inmates scattered throughout various institutions. Necessary increased rates to be paid for State and county institutional patients have also figured in the increase. Careful investigation has convinced the Board of Charities and Corrections, in which judgment I concur, that a complete rearrangement of policy is necessary to secure the best results from the Women's Reformatory at Clinton. The desire is to make of this institution more of a reformatory as at Rahway, rather than alone a prison. The rather large increase in appropriation recommended for this institution is in contemplation of this new policy. A substantial saving has been effected, and has made possible the comparatively slight increase in consideration of abnormal market prices, by reason of the fact that for the first time in the history of institutional management re

quests for appropriations covering food and other maintenance items are based on a standardization fixed in accordance with dietaries adopted.

The total amount recommended for salaries and wages of $3,846,124.00 is an increase of $187,170.00 as compared with an increase in the same item of last year amounting to $292,688.00, and includes a much belated recognition of the justice of raising the remuneration of teachers in our normal and other institutional schools. In other words, the increase recommended this year is but 5 per cent. compared with 10 per cent. last year. Conditions with which all are familiar due to the war, affecting both farm help and inside help, had to be met, but, in addition, the chief reason for the 5 per cent. increase now recommended in the items of salaries and wages is the fact that civil service standardization, as authorized by the last Legislature, has been taken into consideration in making recommendations for the coming fiscal year. This standardization, of course, provides for certain salary increases automatically at certain periods of the year, when recommended by departmental heads.

Because of amendments to the budget act provided by the last Legislature, it is no longer necessary to confine budget recommendations within the income of the State for the fiscal year. This provision makes it possible for New Jersey to take advantage of the great free balance over and above all obligations estimated at about $3,500,000.00 which will be in the treasury at the end of the current fiscal year, which speaks volumes for the successful financial management of public affairs which the State has enjoyed. As the income for the coming fiscal year has been estimated at about $9,300,000.00, we will, therefore, have total resources in excess of $12,500,000.00 from which to conduct the State's business for the coming year. As the total estimated as necessary for what might be termed ordinary expenditures is about $9,900,000.00, we shall have a balance of nearly $3,000,000.00 from which to finance State-wide improvements which seem advisable. The National Government has urged that public works be resumed everywhere in order to supply employment for labor returning from the war and war industries, and the State Government has asked business to resume pre-war enter

The

prise in order to help absorb this same supply of labor, and, of course, at the same time take care of returning soldiers and sailors. In this respect the State should be consistent. State's business is no different from any other. Let us be enterprising and employ as much of our surplus capital as is wise and practicable in the projection of improvements which are necessary, and which will, at the same time, furnish a new field of endeavor for labor.

In this connection I am recommending an appropriation of $1,000,000.00 for the purpose of acquiring, either through gift, purchase or condemnation, a strip of land 1,000 feet wide from Raritan Bay at Morgan to the Delaware River at Bordentown, for purposes of a cross-State ship canal, as provided by Chapters 93 and 128 of the Laws of 1917. This recommendation, in accordance with our legislation of 1917, is, of course, contingent upon the Federal Government appropriating sufficient moneys for the actual construction of the canal. A bill to this effect is now pending in the National Congress, and I feel that we should be ready with our State appropriation the moment the Federal money is available.

Inasmuch as it is reasonable to assume that in the event of favorable action on the part of the Federal Government actual operations would require some time, I believe dividing the $1,000,000.00 in two $500,000.00 appropriations would meet all the requirements of the State. I so recommend.

I am also recommending an appropriation of $350,000.00 for the purpose of building a new wing to the State Capitol. I am convinced that this would be a sound investment and a movement in the direction of economy, as well as a needed public improvement. It is now costing the State about $7,000.00 per year to rent for office and other purposes building space in Trenton outside of the Capitol building for use of State departments, and this must be considerably increased in the immediate future. This loss is magnified far in excess of the actual money figures by the impossibility of securing the best results under conditions of congestion and the loss of time and money in putting up with such inconveniences as traveling extraordinary distances between departments.

I am also recommending an appropriation of $50,000.00 for the purpose of constructing a State warehouse. Such an institution will result in a saving to the taxpayers of thousands of dollars annually in the important function of purchasing food and supplies for State departments and institutions. It will not only permit the State Purchasing Agent to buy goods, not merely when they are needed, and when the market price is low, but it will also permit him to buy in bulk lots and thus receive the benefit accruing thereby in a lower cost price. Recent experiments of the State Purchasing Agent with the business-like policy of buying in bulk when the market is down have resulted in a saving of thousands of dollars, even though it has been necessary to store the goods so purchased in privately-owned warehouses and pay the storage fees. Let us save even the storage fees and permit the purchasing department to function on a still larger and more business-like basis by having our own warehouse. It is important to bear in mind that it is practically impossible for the State to get the benefit of the lowest obtainable cash prices-and this is essential to any successful business, whether State business or otherwise-unless the purchasing agent is able to buy in bulk quantities; manufacturers and original sources of supply will not, as a rule, enter into competition with jobbers and distributors for shipments to various points in small lots, but will classify the State as a distributor provided shipment is made by them to one central point in bulk lots. In other words, the State can buy direct from the manufacturer and get the resultant benefit in price if it has its own adequate warehouse facilities.

I am suggesting an appropriation of $20,000.00 for the purpose of building a garage to house cars owned and operated by State departments. This is another recommendation in the interest of economy, for, at the present time, it costs the State between $7,500.00 and $10,000.00 per year for the storage and washing of cars alone, and these figures are more apt to increase than to decrease. As $10,000.00 represents interest on a sum of more than $160,000.00, it is plainly evident that the expenditure of $20,000.00 for our own State garage is an excellent investment.

ness.

I desire to call your attention to the fact that our budget in New Jersey carries no charge for interest on bonded indebtedConsider the fact that the interest alone for debt service in the neighboring State of New York for 1918-19, amounted to $8,841,060.00, or nearly as much as the total amount of our New Jersey budget for all purposes, and all must agree that our plan of "paying as we go" has economical features of distinct value.

In conclusion, it is most gratifying to realize the substantial results attained through New Jersey's gradual evolution to a business method of conducting State affairs. Starting with the consolidation of departments under the original economy and efficiency bills; quickly followed by the creation of the State Purchasing Department; then the Executive budget; the further development of consolidation through the Charitable and Correctional institutional legislation of last year and the concentration of all highway problems into one department; to-day the business of the State is in a clear, concise and well-organized position.

The additional power delegated to the State House Commission to supplement appropriations and meet emergencies, after careful investigation, superseding the old method of the entirely indefensible and ill-digested supplemental bill, has provided an executive board in the State that has brought all the activities of the Government into close relationship and has permitted the Governor and all future Governors the opportunity of really managing the business of the State. In administering the emergency appropriation, Comptroller Bugbee and Treasurer Read have given painstaking co-operation and support.

It is with much personal gratification that in submitting this, my last budget to your Honorable Body, I can thus present through you to the people of New Jersey a business organization which only requires continued co-operation and a realization and acceptance of the new note in governmental business and which. permits comparisons between the new policy of the State and that of successful private business such as must be a matter of pride and satisfaction to all of us.

There have been unusual difficulties in preparing this budget,