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Budget Veto Watch: The Way out of Now

Governor Murphy signs legislation.

So what is Phil Murphy going to do, now that fellow Democrats have passed a budget he doesn’t like?

He is on record as saying he would veto it. Let’s assume he does.

What form would the veto take?

The governor can “conditionally” veto the budget, meaning he would accept some parts of it and reject other parts.

That could lead to some type of negotiations. On Thursday, there were reports of a possible compromise on Murphy’s plan to raise the sales tax and the income tax on high-earners.

Rather than immediately bump the sales tax from 6.625 cents on a dollar to 7 cents, that increase would be phased in over two years.

Talk about splitting hairs. An increase of three-eighths of a penny would be accomplished over two years.

The purported compromise also would have increased the threshold for higher income tax rates – 8.97 to 10.75 percent – from $1 million to $5 million. Call it the five-fold millionaire’s tax.

Murphy brusquely rejected those ideas at his Thursday press conference, but they seem reasonable under the circumstances and can be always brought up again.

But suppose Murphy vetoes the budget outright?

That would challenge the Democrats to override a governor of their own party. Sounds crazy, no?

The Dems may not want to go that route for political reasons. Talk about looking dysfunctional to the public.

But there also would be practical considerations.

There were a mere 21 “yes” votes for the budget in the Senate, significantly less than the two-thirds needed for a veto override. The same math problem exists in the Assembly.

This brings up an interesting question.

How about the Republicans? What would they do if there is an override vote?

I encountered Assemblyman Michael P. Carroll, R-Dist. 25, in Trenton shortly after the Assembly approved the budget last Thursday. He said Republicans should support an override. Later, he put it this way in an email. “The GOP should join the (override) on the grounds that there are essentially three choices: this budget, Murphy’s budget, or some combination of both, which will almost certainly be worse than this one.”

A Republican source in the Senate agreed – up to a point. He noted that the Legislative budget is preferable to Murphy’s budget.

That assessment seems strange.

It is the Legislative budget that would raise the corporate business tax, which is now 9 percent, to a high in some cases of 13 percent.

It was GOP Senate Leader Thomas Kean who claimed that move could increase taxes by $7 billion. While Democrats say the increase would net $800 million, Kean insisted the full impact of the increase could be as high as $7 billion.

So if that is the case, why would the party of business support that budget?

The answer is that Murphy’s budget is about $1 billion more than the Legislative budget and that it includes things the GOP doesn’t like, one of which is (perish the thought) free community college.

Still, it’s going to be hard to see Republicans actually supporting a budget that accomplishes two things – raises taxes on businesses and helps out the Democrats.

This brings up yet another possibility. Will we actually see meaningful negotiations on the budget between Democrats and Republicans?

Carroll, who says he is leaving the Assembly after his current term, is fond of saying that the Democrats “don’t need us.

Maybe they do.

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