After the global pandemic forced the cancellation of the Assembly’s public budget hearings back in March and the postponement of the usual April and May department budget hearings, the Assembly Budget Committee held its first budget hearing of the year on Thursday.
It was remote and it was regarding a very different budget than anyone expected months ago. But State Treasurer Elizabeth Muoio and the budget staff of the nonpartisan Office of Legislative Services (OLS) testified about the FY20 and FY21 State Budgets.
Typically in these hearings, there is a major revenue difference between the nonpartisan OLS and the Governor/Treasurer’s forecast. This year, OLS is a little more optimistic for the rest of FY20, expecting about half a billion more in FY20 revenues than the Murphy administration.
Most of the OLS’ optimism comes from higher expectations for sales tax and CBT revenues. But they admitted there are significant variables and much uncertainty to any forecast in these unprecedented times.
The Murphy administration managed to close out the FY20 budget without relying on any borrowing or tax increases, and members of the Assembly rightfully gave Gov. Murphy and Treasurer Muoio credit for building up the Rainy-Day Fund and the surplus to help do that.
Borrowing and potential tax increases were not the focus of the hearing as it was largely focused on FY20 budget solutions, but the Assembly Budget Committee is planning to vote on a $5 billion borrowing bill on Monday..
Treasurer Muoio did face some questioning on behalf of the business community from Assemblywoman Munoz and Assemblyman Spearman as to the lack of federal CARES Act funding going to support struggling small businesses.
Currently only 2% of the New Jersey’s proposed CARES Act allotment included in Treasurer Muoio’s budget solutions is proposed to go to supporting small business with EDA’s new $50 million program announced last week.
NJBIA believes that number should be higher as government mandated the closure of many of these businesses, and now they need our help which is what the CARES Act funding was intended to provide.
NJBIA will continue to advocate for business and all taxpayers within our State Budget process. Please feel free to email me for any budget questions.