New Jersey’s bonded debt is at its lowest level in a decade, according to the Fiscal Year 2023 Debt Report issued this week by the state Department of the Treasury.
The report, which outlines the state’s outstanding debt obligations, showed overall state debt has declined $38.1 billion since 2018, from $239 billion to $200.9 billion in 2023.
Bonded debt was reduced to $41.5 billion in 2023, marking a 5% reduction year-over-year and reaching the lowest level in 10 years.
Establishing a fund three years ago to pay down state debt has saved New Jersey taxpayers over $1.3 billion. Other budgetary moves, including fully funding the pension system for public employees, have helped the state secure seven credit rating upgrades in two years.
“We have made great strides towards righting our fiscal ship, including actions such as making full pension payments and defeasing bond obligations, leading to reductions in the state’s overall debt levels,” said State Treasurer Elizabeth Maher Muoio.
Through the Debt Defeasance and Prevention Fund, the state has defeased a total of $3.686 billion in bond principal, saving state taxpayers $1.358 billion in interest expense since FY22. Most recently in January, Treasury successfully retired almost $500 million in debt, saving taxpayers about $160 million.
The full report was delivered to the New Jersey Commission on Capital Budgeting and Planning on Tuesday.
