NJ Spotlight: Murphy, Lawmakers Have Only Weeks to Make Hard Budget Choices - Garden State Initiative

IN THE NEWS

Governor Murphy, Economic Opportunity for All

NJ Spotlight: Murphy, Lawmakers Have Only Weeks to Make Hard Budget Choices

May 26, 2020

FacebookTwitterLinkedIn

By John Reitmeyer

Gov. Phil Murphy’s administration has laid out a series of spending cuts, deferrals and other budget adjustments to offset short-term revenue losses caused by the coronavirus pandemic  But he and lawmakers still face even more difficult decisions on state spending in the future.

Thanks to their agreement to extend the state’s fiscal year to ease the pandemic’s economic hurt, Murphy and lawmakers must adopt a three-month supplemental budget plan by the end of June.

In preparation for that, the administration unveiled on Friday a stripped-down, $7.7 billion spending plan to get the state through what would have been the first quarter of fiscal year 2021 under normal conditions.

This three-month budget, which is subject to legislative approval, drops nearly $850 million in spending Murphy had proposed back in February, before the pandemic took hold across the state. In addition, Murphy has set aside a series of planned tax hikes, including his long-sought true millionaires’ tax.

Still looming after that for Murphy and legislative leaders is the adoption of a spending plan for the new, nine-month fiscal “year” 2021 that will begin in October. That task has only been made more difficult by some of the decisions that were made to balance the near-term revenue losses, including the planned spending down of surplus funds and a deferral of some major line items, including a nearly $1 billion state pension contribution.

State Treasurer Elizabeth Maher Muoio acknowledged the “significant challenges” that lie ahead during a media briefing in Trenton on Friday.

Read the full report here.