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Originally published Tuesday, February 26, 2013 at 1:23 AM

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Christie budget message expected to focus on Sandy

Gov. Chris Christie is expected to deliver an austere budget message on Tuesday focused on rebuilding after Superstorm Sandy, as New Jersey struggles to regain its footing after the worst natural disaster in its history.

Associated Press

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TRENTON, N.J. —

Gov. Chris Christie is expected to deliver an austere budget message on Tuesday focused on rebuilding after Superstorm Sandy, as New Jersey struggles to regain its footing after the worst natural disaster in its history.

His address to the Legislature is set for 3 p.m.

The governor is counting on billions of dollars in federal Sandy relief funding to boost construction jobs and help communities that lost part of their tax when homes were destroyed and businesses closed.

Christie's proposed budget could be thrown into turmoil by the end of the week - to the peril of the state's property holders - if President Barack Obama and Congress fail to strike a deal on looming federal budget cuts.

The first $1.8 billion in Sandy aid is due in April. But New Jersey could see $100 million less than expected unless there's a deal in Washington to eliminate federal cuts set to take effect Friday. Preschool classes and regional airports could also be shuttered.

Christie's budget counts on Sandy funding to stimulate the state's still-sluggish economy and help municipalities along the coast whose revenue base was upended by the late October storm. The Division of Local Government Services estimates that 25 municipalities lost at least 5 percent of their tax base to Sandy.

The Republican governor has told residents of hard-hit towns whose homes survived the storm to expect to pay higher property taxes. But that could be a bitter pill for New Jerseyans recovering from Sandy. State residents already pay the highest property taxes in the country, averaging $7,870 per household.

Budget Officer Declan O'Scanlon, who represents some of the shore towns, said a portion of the Sandy aid was earmarked for property tax relief to cushion the blow.

"Regarding Sandy and property taxes, the way we're going to hopefully resolve that is with federal money," O'Scanlon said. "That's been done before in other jurisdictions where they've had massive storms like this."

"There are billions of dollars coming from the federal government," he added. "The administration has as a top priority dealing with the gaps, the gaps in insurance coverage, the gaps in people's ability to elevate their houses and what they can afford they're getting from insurance, another key gap is property tax gaps."

Assemblyman Vincent Prieto, a Democrat who heads the Assembly Budget Committee, said he wants to hear Christie address the revenue shortfall, which stands at $350 million seven months into the current fiscal year. Revenue collections have gained steam in the past two months, after significantly underperforming projections in the first quarter.

If tax collections don't improve, year-end budget cuts will be required because the state constitution does not allow deficit spending.

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