Senator Richard J. Codey expressed his support for the COVID-19 Budget Recovery Bond Act and urged Senate President Stephen M. Sweeney to post the bill for a vote. This legislation will allow the state to borrow the funds needed to avoid draconian cuts to municipal aid, education, healthcare and other essential services forced by the pandemic crisis.
Codey said, “New Jersey is facing a financial pandemic. By September, the state’s checks will bounce. Schools’ checks will bounce. Counties’ checks will bounce.” Senator Codey added. “The size of this crisis is second only to the COVID-19 pandemic. But we can avoid the worst of it if we act now.
“We have to do this, and the sooner the better. At this rate by fall there will not be enough money to run the state, and shortfall will quickly reach the local governments and schools as well. The incredible loss of revenue from the income tax, sales tax, and casino tax leaves a hole in the state budget that can’t be responsibly resolved in any other way.
“The plan would allow the state to borrow up to $5 billion from bond investors, additional funds from the Federal Reserve’s Municipal Liquidity Facility, and to help local entities that can’t do so themselves to borrow from the Federal program. It would also allow the state to buy local government debt. If the legislature does not allow for this borrowing, the State is on track to run out of money in September, forcing massive layoffs and cuts to the services at all levels of government.
“This is an unprecedented situation. We have seen tough times before and made it through recessions and natural disasters, but COVID-19 is different. It came without warning, and continues to affect all parts of the state. We have to preserve our vital services and we don’t have a choice but to do this.”