Senate Republicans Set Priorities for Responsible Budget Proposal Ahead of Governor’s Speech

With Governor Phil Murphy set to deliver the annual budget message next Tuesday to the Legislature, the Republican members of the Senate Budget & Appropriations Committee called for a budget proposal that restrains spending and prepares New Jersey for a possible recession, provides tax relief to families and businesses, represents fairness in how appropriations are determined, and protects school districts and property taxpayers from harmful cuts in State aid.

Republicans offered comprehensive, thoughtful, and meaningful changes to the proposed budget last year to accomplish each of these goals that Democrats in the Legislature and Governor Murphy completely ignored. Instead, Democrats passed a budget that hoarded tax over-collections and went on an undisciplined, pork-fueled spending binge.

Senate Republican Leader Steven Oroho (R-24), Senate Republican Budget Officer Declan O’Scanlon (R-13), Senator Michael Testa (R-1), and Senator Doug Steinhardt (R-23) said the governor’s budget proposal would be irresponsible if it doesn’t meet each of the following priorities:

Restrains spending, prepares for a recession: A more balanced approach to prepare for a recession is needed by focusing on tax reforms that grow the economy. We must quickly and competently put to use one-time cash balances towards important capital projects and debt reduction, while restraining and reforming spending on recurring programs.

“The nearly 50% increase in State spending over the five years of the Murphy administration is completely unsustainable,” said O’Scanlon. “That will become painfully true if we are hit by a recession this year as many economists have warned is possible. We can prepare New Jersey to weather an upcoming storm by putting existing pandemic relief and debt defeasance funds to work smartly, cutting the pork, and focusing on tax reforms that will help grow the economy.”

Provides tax relief: Provide tax relief with a focus on structural tax reforms to make New Jersey more competitive. Allocate all tax over-collections – which could reach $2 billion this year – to tax relief, including stopping “automatic” payroll tax increases and toll hikes that will take effect over the next year. Index New Jersey’s tax brackets for inflation to stop tax bracket creep that drives people into higher tax brackets. Support non-profits that provide essential services in our communities that government would otherwise have to pay for with a new tax deduction for charitable contributions.

“New Jerseyans are the most highly taxed people in the country and it’s hurting our families and businesses,” said Oroho. “Reforms that make us more competitive will help our economy grow. With billions in tax over-collections likely this year, we can stop the automatic tax and toll increases that the Murphy administration has supported and provide real inflation relief by indexing our tax brackets like dozens of other states. We can also give it back directly to New Jerseyans.”

Represents statewide fairness in appropriations: Avoid favoritism and “Christmas tree” spending in the State budget and in the use of federal pandemic relief funds. Funding for programs should be merit-based, competitive, and distributed statewide.

“Governor Murphy’s budgets have doled out hundreds of millions to projects concentrated in a few Democrat-controlled areas, while other needs that are just as worthy in rural and suburban districts represented by both Republicans and Democrats have been ignored,” said Testa. “The State Budget should benefit all of New Jersey, not just areas that have political connections to the governor and Democrat party bosses. Funding should be approved for competitive, merit-based grant programs, not handed out as individual line items in the budget to a favored few.”

Stops school aid cuts: Nearly 200 school districts lost state aid last year under the State Budget approved by Governor Murphy and the Democrat majority. Many other districts received small increases that don’t cover inflation, which is effectively an aid cut. No district should suffer harmful reductions in aid as they struggle to respond to learning loss that resulted from pandemic school closures ordered by the Murphy administration.

“Hundreds of rural and suburban school districts have had their State aid cut or outpaced by inflation while they’re contending with learning loss and plunging test scores resulting from pandemic school closures and remote learning,” said Steinhardt. “This underfunding of districts throughout New Jersey occurred even as large increases in State aid were directed to a few of the biggest districts that already get the lion’s share of funding. We must stop cutting aid to our schools, shortchanging our students, and increasing the burden on property taxpayers who end up paying more.”