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There are generally two schools of thoughts when it comes to the whopping $10 billion surplus in Gov. Phil Murphy’s proposed budget for FY24:  

It’s either too much for New Jersey to have collected and hold, or the state is going to need it stored for a future economic downturn. 

NJBIA Chief Government Affairs Officer Christopher Emigholz says the answer is probably somewhere down the middle – but also challenged the myopic view that the state’s surplus is below the national average. 

“You can understand both sides of the discussion,” Emigholz said. “Critics of the surplus will say that big surplus represents taxes that were unnecessarily collected and now not being used – and they wouldn’t be wrong. 

“Proponents will say this level of surplus is responsible to prepare for a possible economic downturn amid national and global uncertainty – and certainly that’s being forecasted by many economists.  

“So, the bottom line is a $10 billion surplus is possibly oversized, but we also need to avoid tax increases and spending cuts in the event of an economic downturn. We can and should both save and invest in opportunities to grow our economy.” 

Emigholz noted there also is a need to protect the presumed sunset of the 2.5% Corporation Business Tax surcharge.  

“If you have a smaller surplus and then less revenue coming in, any kind of tax reduction could be put at risk,” Emigholz said. “It will require a careful balance.” 


In a hint of intrigue, the nonpartisan Office of Legislative Services this week projected that the combined state revenues for fiscal years 2023 and 2024 will fall a little more than $1 billion below the estimates in Gov. Murphy’s budget proposal. 

Specifically, OLS revenues are 0.7%, or $374.7 million below the Murphy administration’s estimates for current year FY23 and it has revenues at $680.2 million, or 1.3%, less than executive estimates in FY24.  

Emigholz, however, noted this is not a major discrepancy. 

“You’re basically looking at a $1 billion difference across two budgets totaling more than $100 billion,” he said. “That’s about a 1% difference between OLS projections and budgets proposed.” 


A recent ROI-NJ report quoted a State Treasury spokesman as noting that New Jersey’s $10 billion surplus is actually below the national average – citing figures from the National Association of State Budget Officers. 

Emigholz, however, said how New Jersey’s surplus stacks up to other states in the nation is “not an apples-to-apples comparison.” 

“For starters, the governor in New Jersey has much more authority to make unilateral budgetary decisions or make mid-year shifts in how and where money is allocated than other states,” Emigholz said.  

“Other states have used their federal American Rescue Plan Act funds more than New Jersey has. Another big factor is budgetarily how New Jersey is taxed and how it spends compared to other states. If our surplus is going to be compared the same to other states, perhaps we should be taxed like other states.”