It’s budget time in Trenton, to be precise, less than two weeks away on June 30th, and this year’s budget discussion will be unlike any other because our state government is actually overflowing with cash by a staggering $9 to $12 billion and has yet to be finalized in less than two weeks. 

Bear in mind, that New Jersey’s debt is already nearing a record $250 billion.

First: A Bit of Murphy’s Budget History 

In Gov. Phil Murphy’s March budget address, (his first in-person address since 2020), he said he planned to spend a record-high $49 billion to support a broad property tax rebate program and increase funding for schools and health care and not to raise taxes.

With COVID-19 relief funds and record tax revenues, Murphy’s spending plan for the 2023 fiscal year, which is coming up on June 30^th, will “help”(but not necessarily) create opportunities for New Jerseyans while still honoring the state’s financial commitments.

The $48.9 billion budget must be approved by the Democratic-led Legislature, so spending details and the final figure are likely to change by the end of the current fiscal year, which is June 30. Last year’s $46.4 billion budget was approved with new spending and pet projects Democratic lawmakers tucked into the spending plan at the last minute. This still remains to be seen for 2022. In the address, Murphy said “affordable” or “affordability” 20 times in the nearly hour-long speech. That’s going to be a neat trick because New Jersey is currently holding a record breaking $48.2 billion in bonded debt resulting in a grand total for New Jersey debt which is close to $250 billion!

“When we talk about affordability and opportunity, what we are really talking about is empowering people. We’re talking about giving people more choices and more options — and, ultimately, more control over their lives and futures,” Murphy said.

Republicans, who have been critical of Murphy’s past budgets, as earlier reported on TLS last month.

“It’s undeniable that Governor Murphy has taken billions more from taxpayers than he has ever admitted, and he won’t be able to hide it past Thursday,” said Senator Michael Testa (R-1). “He still plans on raising taxes next year on employers, employees, and health care even though there is no budgetary need to do so. Given the massive and growing pile of cash he’s sitting on, there is no excuse for Governor Murphy to deny New Jersey families the immediate tax relief that Republicans have already proposed and more.”

As expected, trade organizations such as the New Jersey Business & Industry Association, meanwhile, rejected Murphy’s “no new taxes” assertion, because they assert would have to pay increased payroll taxes to refill the pandemic-drained unemployment fund, they were essentially footing the bill. Meanwhile, there are $3 billion in federal pandemic relief money that still remains unspent and unallocated even though the law a law mandates the governor provides a detailed plan on how to spend it. The pandemic has left lingering issues yet to be addressed in the like capital shortage, labor shortage and spiraling inflation.

Under Murphy’s plan, the state would spend $900 million in the first fiscal year, 2023, which has been approved. In a recent announcement for more than 1.5 million eligible homeowners earning up to $400,000, rebates on their tax bill from $450, $1000 and $1500 dependent on their income. In addition, more than 600,000 renters, included for the first time, would receive a direct deposit or check up to $250 if they earn $100,000 or less. This would replace the Homestead rebate program, which benefited nearly 490,000 seniors and low-income households in the 2021 fiscal year

Murphy also plans to increase aid to public schools by $650 million, for a total of $9.92 billion, as part of a seven-year plan to raise state spending on grades K-12. This may be tied to mandated CRT and so called “Pride” programs that are destroying our kids in public schools. It does not appear that any of this money would be for any private school funding such as local Yeshivas, typical of the liberal agenda.

He’s also proposed an additional $68 million toward a long-term universal pre-kindergarten plan. A majority of that money, $40 million, would be used in about 40 school districts to “benefit” 3,000 students. Many are concerned that these funds may be contingent on the Democratic propensity to mandate CRT and even vaccines. Opponents to these programs have been dragged out of school board meetings and even jailed for their vocal opposition.

A Medicare Part A and Part B refund has already been approved where seniors over 65 will receive annual direct electronic or check payments reimbursing their Medicare premiums.  He also proposed a Medicaid expansion by spending by $15 million to enhance maternity care and increase reimbursement rates for midwives and doulas.

The budget includes more than $5.4 billion for “comprehensive” health coverage through NJ Family Care for more than 1.9 million low-income families. Since the start of the COVID-19 pandemic, enrollment in that program has increased by nearly 400,000 people, according to the Treasury Department. The state already has half of its $6.2 billion share of the federal American Rescue Plan money for pandemic costs that has been languishing and unspent.

Where We Are Actually Holding in 2022

Unnecessary tax increases and reckless borrowing the governor enacted in his first term are primary reasons for the budget surpluses. In addition to the $9 billion to $12 billion is another $3 billion in federal pandemic relief money that still remains unspent and unallocated — despite a law mandating that the governor provide a detailed plan. These surpluses raise serious questions, regarding the governor’s fiscal management of the state. Increasing income taxes on the most taxed people in the nation. Increased business taxes when New Jersey already has the nation’s worst business climate. Borrow $4 billion to balance last year’s budget when unspent money sat languishing in Trenton. Grabbing each town’s energy receipt taxes and municipal/county 911 communication fees, causing increasing burdens on the township’s resources. None of this was necessary and in fact strained local budgets for vital services.

To me, this was a deliberate strategy to increase the state budget to an unprecedented 40% in just five years’ time. This has led to a taxpayer-funded surplus. With the budget deadline less than two weeks away, Murphy still has no detailed plan.

As previously reported in TLS, Republicans have put proposed a “Give It Back” initiative that returns the surplus to taxpayers by way of $1,000 and $500 rebates. Some of which has been successful in the aforementioned Medicare and property tax rebates. Thank you, Republicans because due to the Republican pressure, this is likely “the largest tax relief program in state history.” The Senate president said these surpluses should be used to protect New Jersey from a  guaranteed recession not seen in decades.

Carefully instituted surplus and rainy-day funds are good but the excess surpluses are just plain over-taxation. Like the rest of the nation, New Jerseyans are being reeling from skyrocketing fuel and food prices and overall inflation that’s out of control, in fact has reached a 40-year high, New Jersey residents are desperate for relief. Ciattarelli would like to see $500 million more in the state’s Transportation Trust Fund and even suspend the gas tax for the summer. That could reduce the price of a gallon of gas close to 42 cents per gallon.

Here’s a pet peeve of mine that has largely fallen on deaf ears: The New Jersey government’s technology systems are antiquated from the State on down to County and Townships New Jersey has some of the worst response times and user experiences in the nation. We need to invest in modern-day technologies and especially cybersecurity not only to increase the speed and quality of taxpayer and business interactions but to prevent them from going down altogether from the spiraling increase of ransomware attacks on government, especially at the local level.

New Jersey has a state debt of a stunning close to $250 billion which future generations are going to have to cover by taxation.

Murphy’s budget decisions are once again delayed until the last minute and made behind closed doors by a select few who are sure to sneak pet projects into it as they are wont to do. This could actually be a revolutionary opportunity for the people of New Jersey. It’s time that the State Legislature is called into special session ASAP. Apparently, Murphy, is not taking charge as the deadline rapidly approached. I think it’s time that the Legislature takes over with some sound decisions, transparency and no more special interests.

The opinions stated in this article are solely those of the author.