BRIAN THOMPSON, Host: -- Governor JAMES McGREEVEY (New Jersey): And so my truth is that I am a gay American.

With those words, in a sex scandal he could not possibly survive, New Jersey Governor James McGreevey resigned, passing into history and a new life. And State Senate President Dick Codey in effect won the lottery, becoming, till the end of McGreevey's term 14 months from now, the most powerful governor in America since the state Constitution requires he keep his day job as leader of the Senate. So who is this average Joe who holds a private swearing-in at his home, who has breakfast with the mentally ill his first day in office, and on day two vows to lift the ethical standards of a political culture ridiculed nationwide? Today on NEWS FORUM, we will find out.

Announcer: From Studio 6B in Rockefeller Center, this is a presentation from News Channel 4, Gabe Pressman's NEWS FORUM. Now your host, senior correspondent Gabe Pressman.

THOMPSON: And thank you for joining us today. I'm Brian Thompson, sitting in for Gabe, who is on assignment this week.

And, Governor Codey, welcome to our show. This is the first time you've sat down for an expanded television interview since you took over just a few days ago.

Governor RICHARD J. CODEY (New Jersey): That's true, Brian. You're going to pay for this exclusive, believe me.

THOMPSON: It is Governor Codey or Acting Governor Codey? How do we...

Gov. CODEY: Well, let me put it to you this way, Brian. I'm the governor and I'm going to act like it.

THOMPSON: Well, that puts it in a nutshell, I guess. Three months ago--three months and about a week ago, the former governor, Jim McGreevey, on August 12th made a stunning announcement that was heard around the world around 4:30 in the afternoon. How did you find out? What were the circumstances that you found out that he was going to make this announcement, and did you have any hint of this in the days leading up to it?

Gov. CODEY: No hint at all. That morning we got inquiries from reporters, `What's going on?' so forth and so on. I got a call that his staff had called my staff about when to resign and--so there wouldn't be an election, so it was obvious to me something big was going on. I got a call about 1:30, 2:00 in the afternoon from the governor telling me he was going to resign effective November 15th. I would become the governor. And he said, `Dick, you're going to be a great governor. Best of luck,' and that was it. And for me it was a sad conversation, for him as well. It hit me like a ton of bricks, to be honest with you. At that point in my life, I had had some tough years politically. Both my parents had just died within five months of each other. My wife nearly died the year before that. So I was looking to kick back, if anything. And I realized that day--what was the cliche--one day in politics can be a lifetime. And for Jim McGreevey and for myself, August 12th was certainly that day.

THOMPSON: As you look back on it now and everything that has transpired and come out, do you think he actually had to resign from a political survival standpoint?

Gov. CODEY: There's no question he could not have won re-election with that scandal, and he just felt, and I understand that, that if he continued on, that would have dogged him through the rest of his time in office, and it wasn't worth it for him, his family, and more importantly, the people of the state of New Jersey.

THOMPSON: So now we have a person who steps into the role as acting governor, but as you say, you will be a full-time governor as well as a full-time Senate president controlling two of the three main levers of power in Trenton. And I think people want to know a little bit about you. Before I ask you that, I think we want to roll a piece of tape from a news conference you held at the beginning of the week explaining what makes you tick. Let's go to that tape.

Gov. CODEY: (From news conference) For the most part, I'm low-key, but if you throw a punch I'll throw it back without question. I won't pick the fight, but I'm never going to back down from the fight.

THOMPSON: Those were very feisty words, and it was a pretty innocent question that was thrown out at you. There was no talk about political bosses or anything like that. Why did you put it in those terms?

Gov. CODEY: Well, because throughout my political career, I've taken on my own party. In the last 10 years, twice I've run against the Democratic organization in Essex County, a very powerful organization, because I thought they were wrong in the manner in which they were approaching politics. On both those occasions, against sterling odds, I was allowed to survive by the voters, so I'm not afraid to take on political leaders when I think they're wrong. And so be it. But as I said before, I'm not going to throw the first punch. But if you throw one at me, I'm going to come back and I'm gonna come back blazing.

THOMPSON: In fact, there--some people call them party bosses; other people call them the county chairmen, for the most part. They are able to accumulate vast amounts of money through their positions. Is that inherently a problem with the system in New Jersey that we have all of these county bosses, both on the Republic and the Democratic side spread across the state?

Gov. CODEY: Well, it can be, but despite their opposition to me, for the most part, I've been able to survive and won re-election for the last 30 years or so, and when I've run for leadership I've won despite those people being opposed to me. So the--my colleagues in the Senate say Dick's a good leader; we're going to keep him, despite the opposition from some political bosses.

THOMPSON: And yet, many of your colleagues are, let's say, beholden to some of those party leaders.

Gov. CODEY: Right. They're willing to stand up and say, `The right thing to do is elect Dick as our leader,' and they've done that, and I give them a lot of credit for doing that.

THOMPSON: Well, whatever it may be, you certainly now have an opportunity, and I'm sure you realize you have an opportunity--you have 14 months in control of those two branches of government, in effect, or at least half of one branch. Do you see it as that? I mean, do you see this as...

Gov. CODEY: Oh, I see this as a great opportunity, but I'm not going to change who I am, the values that I hold and what I'm about. And I don't want to change my life to a great degree. I'm the governor--obviously, it's changed forever. But without question, I would want to maintain the things that I do, that I love and like outside of a world of government-slash-politics.

THOMPSON: Jim McGreevey ran for office promising to change the way Trenton does business. You have been part of that system for 30 years. Is it changeable?

Gov. CODEY: I would disagree with you on that, Brian. You just talked about party bosses being against me. Just because you're in office doesn't mean you're part of the problem. Just because you're outside of government that you're a reformer. I've been both and will continue to do that.

THOMPSON: And do you think you can continue to be a reformer?

Gov. CODEY: Absolutely. I think you've seen it in the first couple of days, and you're going to see it in the next week or two that you can call me a reformer. But I don't want to say I'm just a reformer. I'm a public servant who's in office trying to do the right thing, and hopefully will accomplish just that.

THOMPSON: What do you think needs to be reformed in Trenton?

Gov. CODEY: I think we've got to change the idea that we're under the aura, shall we say, of scandal here in the state of New Jersey without question. I've already started that process by saying we're not going to have--allow middlemen on bond deals in the state of New Jersey. That particular consultant was only a consultant because he's connected--or she--politically; doing away with that. We're putting a freeze on the money, the increases that county committees and state committees can raise. I'm going to codify the executive order made by Governor McGreevey in terms of not allowing state vendors to give to county committees if they do state work--not allowing to give to state parties, and even though they don't have to do this, Brian, I'm saying don't put any money into my Senate political PAC, even though legally I can accept it, or the Senate Democratic majority PAC. That would be wrong. I'd be sending a wrong message, and I would be hypocritical, and I'm not going to do that.

THOMPSON: But some people say these funds, your political PAC, which I assume you use to dole out money to other candidates...

Gov. CODEY: Right, not for myself.

THOMPSON: Right. But you use it to make contacts and to bring in allies, if you will. Some say that that whole system where you have to go to people who might have business in the Senate or whatever is part of the problem. You know, I mean, the average Joe doesn't give $1,000 to a Dick Codey political PAC as a general rule...

Gov. CODEY: Right.

THOMPSON: ...or to a Joe Roberts political PAC, the Assembly majority leader. They do it because they want at least access...

Gov. CODEY: Right, well, what I've been doing now, obviously, is to limit the amount of money those organizations can take and at the same time I want to increase what the candidates themselves can take in to make them more independent, less dependent on the party boys--bosses--the state committee...

THOMPSON: Or you.

Gov. CODEY: ...and even myself. I have no problem with that in way, shape or form. But those candidates that I give the money to would say to you, `Dick doesn't give us money and say, "Now do what I want you to do."' I'm not that kind of a person, never have been, nor will I ever be.

THOMPSON: All right. Well, we'll talk more about some of the specific items that you're going to have to face as governor over the next 14 months when we come back in just a moment.

(Announcements)

THOMPSON: Back again with New Jersey's newly minted governor, less than a week on the job so far.

And let's talk about the job that you face, and right out of the bat, this week we have the first crisis involving commuters who want to try to get to Manhattan from New Jersey, and New York Waterway, the ferry service which is having huge financial problems, and you have people talking about who's going to help bail out the ferry service for more than 16,000 people a day who go back and forth across the Hudson River. A lot of people are asking that the Port Authority do this. You have half control of the Port Authority as governor of New Jersey, which I'm sure you're well aware of. The Port Authority has a lot more money than just about anybody else around here, thanks to the high tolls they charge. Have you thought, have you been asked to step in? Are you going to turn your back on these ferry riders? What are you going to do?

Gov. CODEY: Oh, I can assure you I'm not turning my back on any of these riders-slash-commuters. What I've--sat with the Port Authority. I've spoken to the people in Hudson County, and there is a plan in place if they go under, and it does appear like they might, without question, Brian, so no, we are doing everything possible to make sure that that ferry service continues for the people of the state of New Jersey. I think it's roughly about 16,000 people a day. That's very important to them, so it's very important to me.

THOMPSON: Is it possible that the Port Authority will actually be able to step in financially, or are you doing to leave it up to this Hudson County Industrial Authority to carry the heavy load here?

Gov. CODEY: Right now, the heavy load will be carried by Hudson County. If we need the Port Authority to step in, they will. But that would be only if Hudson can't do it. And I didn't...

THOMPSON: Why not go straight to the Port Authority first, where the real money is? I mean, Hudson County is...

Gov. CODEY: Oh, I think there's real money in Hudson at times, Brian.

THOMPSON: Well, there is, but it's usually in somebody's pockets.

Gov. CODEY: No, I'm not going there. Not at all. No, they're doing a good job and I'm very appreciative of Hudson County for what they're doing for the commuters not only of Hudson but Essex and Bergen and so forth and so on.

THOMPSON: But why not just have the Port Authority take the lead? I mean, this is for both Manhattan and Hudson counties. It's for people who drive into Hudson County to take the ferry or take the...

Gov. CODEY: Well, Hudson County doesn't have to get New York state's consent. We do. And that's a big difference and a longer process, and we may need an immediate solution here, Brian, and that's important.

THOMPSON: All right. There's one other issue to this, though, and that is for these 16,000 commuters who end up going to Manhattan--many of them take the buses. I don't hear Hudson County proposing to take over that separate or attached bus system that Arthur Imperatore...

Gov. CODEY: You're talking about the Jersey...

THOMPSON: ...if--when you get to Manhattan, especially Midtown, they have--Arthur Imperatore has set up a very extensive bus service, New York Waterway bus service, that gets you from the waterfront to the Midtown office buildings.

Gov. CODEY: Yeah. My understanding is that's a smaller part of the problem and the least expensive.

THOMPSON: But who's going to shoulder that burden?

Gov. CODEY: Well, it may be Hudson County itself or with help from the Port Authority or, then at the last resort, Brian, it would be the state of New Jersey. But I don't want to get into that business and we shouldn't.

THOMPSON: All right. Let's talk about other transportation issues. The Transportation Trust Fund, which is basically the big pot of money that finances the major road improvements that are always needed in New Jersey...

Gov. CODEY: And fixes the bridges and...

THOMPSON: ...or any other state. Fixes the bridges, will--repaves the highways...

Gov. CODEY: Yeah, that's correct.

THOMPSON: It is literally running out of money. Governor McGreevey warned us about this when he was in office. A task force warned him about it and he knew it very well, and there was a lot of pressure on him to raise the gas tax so that there would be sufficient amount of money to do these big-ticket items that are coming down the pike. Are you prepared to go that far?

Gov. CODEY: Yes, I am. Before I leave office if it's after 14 months, we're going to address and fix that problem. Whether it's a gas tax or not, I'm not sure. That will be done in concert with legislative leaders on both sides of the aisle, but before I leave office, as I said, if it's 14 months--that would be January of 2006--we will address that problem and we will solve it and solve it for the future generations for a hundred years to come.

THOMPSON: You're promising that?

Gov. CODEY: There must be a dedicated source of revenue so they don't have to come back to the Legislature every couple of years. It's got to be permanent, without question.

THOMPSON: Well, I know there's a flip side to that we'll get into a little bit later, but...

Gov. CODEY: That's fine.

THOMPSON: ...if for some reason you do run for election and win election, would you not fix that problem then within the 14-month time frame?

Gov. CODEY: I've said it without question.

THOMPSON: Either way.

Gov. CODEY: Either way.

THOMPSON: Either way. Whether you're governor after 14 months or not.

Gov. CODEY: That's right.

THOMPSON: But you won't say yet if it's going to be an increase in the gas tax.

Gov. CODEY: No, I'm saying we have to fund it some way. Obviously, that's an option that's been talked about, but I'm not going to commit myself today to that.

THOMPSON: There is one other very controversial road project, transportation project that's sitting on the desk right now and that's the Route 92 connector from US Highway 1 down near Princeton, south--in southern Middlesex County just north of Princeton over to the turnpike. I believe it's Exit 8A if I remember correctly. Environmentalists--it's only six miles. The cost has been projected close to $1/2 billion and environmentalists are extremely worried that it will engender more sprawl in that fairly rural part still of southern Middlesex County. Have you taken a position on this yet? Are you ready to take a position on it?

Gov. CODEY: What I would say today is I'm not ready to do it today. There are some other projects that I think are more important than 92 that I want to do, and we can do right away and I think we should do. 92 isn't off my desk; it's just at the side of the desk right now.

THOMPSON: What are more important projects?

Gov. CODEY: Well, we'll announce those down the road, and I think the people of New Jersey will be very happy and excited about those projects in terms of getting these places quicker and easier.

THOMPSON: But for the people who support that road, you're not going to promise that it's a front-burner issue, and for the people who oppose it, you're not going to promise to kill it.

Gov. CODEY: Yeah, what I'm saying, it's not off the agenda at all, but I think some other projects are more important and can get done quicker. If we did 92 right away, Brian, the lawsuits may take years to wind through the courts and get a decision.

THOMPSON: OK. Let's talk about money and let's talk about the state budget for just a minute because it's been projected a $4 billion.

Gov. CODEY: I was afraid you might go there.

THOMPSON: I know you were. You warned me not to go there, but I'm going to do it anyway. Let's look at some figures, first of all.

Gov. CODEY: OK.

THOMPSON: I want to show you spending increases from last year to this current fiscal budget year, the property tax rebate went up $800 million, DYFS spending up $125 million, hospital charity care, $150 million. I got this from your Treasury department. For municipal and school aid, up $800 million, for higher education, up $160 million. And then there are mandatory increases built in the budget--for example, employee health benefits up $900 million and nursing home subsidies no longer paid for by the federal government, up $500 million. That was from one year to this year, and now we have a $4 billion deficit or so. Have you figured out what balls to balance? And, I mean, you were part of the budget-making process...

Gov. CODEY: Absolutely positively.

THOMPSON: ...with Jim McGreevey. You did part of--you approved some of that tobacco bond funding that was ruled...

Gov. CODEY: Absolutely.

THOMPSON: ...illegal by the courts.

Gov. CODEY: Absolutely. Now reforming DYFS for kids? Is that a mistake? Absolutely not. Will they ever make a political contribution? No. But it was the right thing to do. Charity care for maybe a million New Jerseyans who don't have insurance but yet have a job but don't get health insurance at their place of work. When they go in the hospital, shouldn't we do that? Isn't it the right thing to do? They're not going to make political contributions to me or my Senate pact or to the governor, but it was the right thing to do and I'd do it again.

THOMPSON: So how do you...

Gov. CODEY: But I can assure you this...

THOMPSON: OK.

Gov. CODEY: ...the big increase that we had last year, you're not going to see this this coming year over my dead body. Not going to happen in any way, shape or form. And the last thing I want to do with this budget is to raise personal income tax or the sales tax.

THOMPSON: So do you chip away, for example, at the property tax rebate?

Gov. CODEY: Anything is possible. I prefer not to do that, but there's a lot of options that we have. Obviously, I'm not going to talk about them now. You'd love me to.

THOMPSON: I thought that was the point of this.

Gov. CODEY: But we haven't made all of the decisions, but with a lot of options out there, we're getting a lot of help on the budget and I'm hopeful that we can do it.

THOMPSON: But you're saying there may be some fees or minor tax increases but nothing with sales tax, nothing with the income tax.

Gov. CODEY: I'm saying that is the case of last resort without question, sales tax and income tax.

THOMPSON: All right. Well, that's the 800-pound gorilla you have to deal with. In...

Gov. CODEY: Oh, I've dealt with those kind of gorillas before and beaten them back.

THOMPSON: You're hearing it from the governor right now.

We'll be back in just a moment with a final--some final comments.

(Announcements)

THOMPSON: Back with some final discourse with Governor Dick Codey of New Jersey, here in the office for just a few days now, and one couldn't help noticing, if one looked at what you did, for example, starting with your swearing in. It was a bipartisan gesture with the Republican leader of the Senate, Leonard Lance, doing--holding the Bible for you and administering the oath. Are you a policy wonk or a good guy, a fair fellow well met?

Gov. CODEY: I'd like to think I'm both. I like policy, and I asked Senator Lance to swear me in to send a message to the state of New Jersey. They don't care if I'm a Democrat and he's a Republican. They're saying, `You've got two leaders. Do the right thing,' as I was very appreciative that he did it.

THOMPSON: Were you disappointed in the Republican vs. Democrat discourse over the past couple of years with Jim McGreevey as the leader?

Gov. CODEY: I think I don't mind fair criticism. I understand it. When I was in the minority, I criticized. I was a watchdog. And as long as it's fair and measured, I have no problem with it. When DiFrancesco was the president of the Senate and the governor, we talked all the time. As long as you can talk--that was my problem with Governor Whitman. I was the minority leader. She never reached out for me. I'm not going to do that. Even when we disagree, we're going to talk all the time. Simple as that.

THOMPSON: When you first started in politics--it was back during the Watergate era--did you ever dream of becoming governor?

Gov. CODEY: Oh, without question. Once you're elected to the Legislature, I think they all do. That's normal. It's natural. Your friends do that, your family members, but as I got along in time, Brian, on August 12th, the last thing I'm thinking about is running for governor. McGreevey's going to run again in 2005. So if I want to run for governor, the first opportunity is 2009. So it wasn't a thought in my brain, I can assure you that.

THOMPSON: And is there now?

Gov. CODEY: Oh, there is without question and then, of course, the recent poll showed after I was in office one day, if I ran against the Republicans, I'd beat them all.

THOMPSON: Yeah.

Gov. CODEY: That's not bad after one day, Brian. I mean, give me a break.

THOMPSON: Yeah, that was Quinnipiac. I have those polls right here, and they did say that you would, but they also said that Senator John Corzine would win overwhelmingly against those Republicans...

Gov. CODEY: Well...

THOMPSON: ...by many more points.

Gov. CODEY: ...I don't know about many, but by more points.

THOMPSON: What's the deal? Could you run against the $67 million man in a primary against Senator Corzine?

Gov. CODEY: Well, I could, but let me make it very clear. I have the utmost respect for him. I like him. He's a very decent and honorable human being. So I have no problem with him personally in any way, shape or form, but for me to come into office and right away say, `I'm a candidate,' I think I'd destroy all my credibility with the people of the state of New Jersey and I'm not going to do that.

THOMPSON: So you're reserving judgment.

Gov. CODEY: You've got that right.

THOMPSON: But you don't have much time. The primary's in May.

Gov. CODEY: No, I understand that and appreciate that.

THOMPSON: Corzine is already organizing.

Gov. CODEY: Yes, he is and that's fine. I have no problem with that, but that's not going to affect my decision in any way, shape or form.

THOMPSON: We'll find out in January. Governor Dick Codey, the acting governor of New Jersey, thank you so much for being with us today on NEWS FORUM and we'll hear from you soon I'm sure. Goodbye.