- New Jersey Gov. Phil Murphy, a Democrat, announced a $55.9 billion state budget on Tuesday.
- Among the major agenda items is increasing public education spending by nearly $1 billion.
- “Our budget will ensure New Jersey maintains its proud reputation as a great place to raise a family,” Murphy said of the proposal.
New Jersey Gov. Phil Murphy on Tuesday unveiled a $55.9 billion budget, an increase of about 5% from last year’s proposal, adding nearly $1 billion more to K-12 education funding and providing high-revenue funding. It called for about $1 billion in new taxes on businesses. To raise transportation funds.
Murphy, a two-term Democrat, used the budget to identify a recurring funding source for New Jersey Transit and fulfill a campaign promise to fully fund the state’s school system, something that has never been fully implemented. The budget was allocated as follows.
“Our budget will ensure New Jersey maintains its proud reputation as a great place to raise a family,” he said.
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The governor’s seventh budget proposal comes amid declining revenues for the current fiscal year, which Murphy blames on a hangover from 2022. The proposed budget proposes cutting more than $6 billion out of the state’s roughly $8 billion surplus to make up the difference.
Murphy campaigned in 2017 to fully fund the tuition assistance program, which the state Supreme Court ratified in 2009 but was never fully implemented. The proposal calls for increasing aid from nearly $10.8 billion to $11.7 billion, but Murphy also highlighted the gradual increase in school funding since he took office. Through most of Republican Chris Christie’s two terms, aid remained roughly flat at $8 billion a year.
The governor sees the increase in tuition subsidies as a boon for schools and students, as well as an important element in relieving pressure on local property taxes, the majority of which go to schools. There is. The argument is that by increasing state aid for education, towns can reduce property taxes.
New Jersey Governor Phil Murphy speaks to reporters after signing the bill Thursday, July 6, 2023, in Paulsboro, New Jersey. (AP Photo/Wayne Parry, File)
The budget also aims to provide funding for another of Murphy’s campaign promises: the state’s often-challenged transportation system. The system required regular use of capital funds just to maintain operations, with limited resources for system-wide improvements. To close this gap, Murphy is proposing a 2.5% tax on business profits for companies making more than $10 million a year.
The proposal comes after a temporary business tax increase ended late last year. The levy would affect about 3,100 companies, while the new proposal would impose the tax on about 600 companies, according to the government. Murphy said small businesses will not be affected.
Business leaders denounced the hike, saying it effectively set back the governor’s promise to continue lowering corporate tax rates.
“Making a promise to promote investment and then reneging on it weeks later is more than making a bad policy,” said Michele Siekelka, president of the New Jersey Chamber of Commerce.
Advocates for groups representing transit workers said the tax increases are necessary.
“Governor Murphy’s move to restore a portion of the corporate business tax to fund New Jersey Transit will ensure that the wealthiest corporations, currently making record profits, pay their part to keep the state afloat. “This is an important step towards making the world a better place,” said Sara Kallinen, Make the Road’s director. New Jersey, immigrant rights advocacy group.
The state budget has increased significantly since Mr. Christie signed a $34.7 billion spending plan and left office. States collect income, sales, and business taxes to fund a variety of programs and services, including funding for education and health care as well as the state government itself.
Murphy also proposes continuing the property tax relief program, which first began in 2022 and provides up to $1,500 in tax rebates and assistance to renters for households making less than $150,000 a year. As originally planned, the program assisted less than 1 million households. Murphy said the new budget would expand benefits to 1.3 million households, but it was not clear how exactly that would be done.
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The budget is not final and must first pass the Democratic-led Congress, which gives Murphy a spending plan by June 30.
