JERSEY CITY, N.J. — The Garden State, like virtually every other state in the country, took an economic hit from the coronavirus pandemic. However, unlike many other states, New Jersey is actually facing a fiscal year in healthy financial shape.
In his budget proposal for the new fiscal year unveiled Tuesday, Gov. Phil Murphy attempted to take full advantage of that, and help himself politically in the process, in a year that he’s up for re-election.
He made many promises to a wide array of New Jersey residents in the $44.8 billion budget proposal.
The plan seeks to boost spending by nearly 9% on a host of programs, including the public pension, school aid and a $500 tax rebate to nearly 800,000 families.
Thanks to New Jersey’s expectation of federal stimulus funds, as well as unexpectedly robust receipts from sales taxes — the state’s biggest source of revenue — the Garden State is in far better fiscal shape now than had been forecast.
As a result, Murphy said in his pre-recorded address, “The budget I am presenting today can make these investments, and achieve these goals for the year to come, with no increase in taxes.”
Specifically, the budget situation appears to be in the black for now in part because the state had forecast a shortfall of $20 billion to $30 billion. Instead, coffers fell short by about $4.3 billion.
Federal stimulus payments to the Garden State are expected to be about $6 billion, leaving a possible surplus of around $2 billion.
“I can stand here today and tell NJ Transit riders that, for the fourth year in a row, you will not see a fare hike,” the governor said.
He also said that the state was “modernizing critical operations” of the “MVC and employment systems in the Department of Labor.”
Both the Motor Vehicle commission and the unemployment insurance system had serious backlogs this past year because of COVID cases and staffing.
Speaking of state employees, the governor also said that retired workers will receive a long overdue payment to their pensions.
“We will achieve full funding” of the state employees’ pension fund, Murphy said, “for the first time since 1996. A total payment of $6.4 billion, a year earlier than planned.”
Critics said that while that may be expected in a budget address like the one the governor made on Tuesday, they know that the legislature will now revise the budget. They called on that revision to serve more people in the state better.
John Wisniewski, a former state assemblyman, conveyed just how fine that filter is going to be.
“There’s an old saying,” the 11-term former legislator said in an interview, “While the governor proposes, and the legislature disposes.”
Both the State Senate and the State Assembly will now revise the governor’s proposal. Wisniewski said the biggest change going forward will likely involve a boost in education funding.
“Let’s take care of our children today,” he said, noting that the state’s students have fallen behind during the 12 months of the pandemic. “Because that year lost for them in education is not something that can be made up next year,.”
Some advocates also said that while the governor’s budget has a variety of programs that help residents of all economic backgrounds, they want to ensure that after the legislature revises the budget, that it serves all New Jerseyans, including those with the fewest resources.
Christian Estevez, the president of the Latino Action Network of New Jersey, said that the final budget needs to include funds for residents “who have not gotten any type of direct aid, any direct type of payment that the rest of the population of New Jersey has had access to.”
He called on the governor and legislature to work together between now and the beginning of the fiscal year in July 2021 to “put together a package that will provide direct funding.”
The Associated Press contributed.