New Jersey Gov. Chris Christie on Friday used his line-item veto to strip millions of dollars out of the state's $31.7 billion budget.

As he approved the budget, Mr. Christie cut $361 million in spending proposed by the Democratic-controlled Legislature on programs such as the Earned Income Tax Credit, elderly medical services and higher-education programs. That money will instead go the state's reserves.

The budget, which passed ahead of the Saturday deadline, averting a government shutdown, also increases state aid to schools, the state's pension system and services for people with developmental disabilities.

But Mr. Christie was unable to include one of his biggest wishes: a 10% income-tax cut across all brackets.