Governor Murphy’s SFY2025 detailed budget recommendations for the Department of the Treasury (Treasury) totals $5.761 billion, a decrease of 3.8% or $230 million from the SFY2024 budget allocation of $5.91 billion.
Below is a review of Treasury’s budget recommendation and its impact on municipalities.
Property Tax Relief: The SFY2025 budget recommends a total of $805.6 million for the Energy Tax Receipts Property Tax Relief Aid, (ETR) a decrease of 15.2% from the SFY 2024 allocation of $950 million. The reduction comes from a cut to the Municipal Relief Fund (MRF) of $150 million from the SFY 2024 budget.
If you recall, the State allocated $75 million in the MRF in SFY2023 and $150 million in SFY2024. This welcomed property tax relief funding followed our collective efforts to restore ETR, which is over $330 million annually that had been diverted from municipalities for over a decade. Like the past two years, it is imperative for local officials to contact their State Legislators to continue their path of full restoration of ETR and increase last year’s allocation of $150 million. In the upcoming days and weeks, you will hear more from the League on this critical property tax relief funding.
The Police and Firemen’s Retirement System (PFRS) shows a recommended $325 million for SFY2025, an increase of 3.06% from SFY 2024’s allocation of $315.4 million.
There is also $2.28 billion recommended for the Affordable New Jersey Communities for Homeowners and Renters Program (ANCHOR), which offers rebates to qualifying homeowners and tenants. The program applies to homeowners earning up to $150,000 who can receive rebates as high as $1,500. Those with incomes between $150,000 and $250,000 are eligible for rebates up to $1,000. Renters earning up to $150,000 are entitled to a $450 rebate. Senior homeowners and renters will receive an additional $250 rebate.
The Disabled Citizens’ Property Tax Freeze program has a recommended allocation of $188.1 million for SFY2025. The program reimburses eligible senior and disabled homeowners for any increases in property taxes relative to the taxes they paid in their initial year of eligibility.
Economic Development Programs: The Economic Development Program is recommended to receive $204.3 million, a reduction of 47.5% from the SFY2024 budget allocation of $389.4 million. The reduction is from the discontinuation of the Film Lease Partner Facility Program and the Business Employee Relocation Grant Program and cuts to the Economic Recovery Fund and Main Street Recovery Fund.
Office of Information Technology: The recommended allocation for the Office of Information Technology (OIT) totals $120.9 million, an increase of $7.6 million from SFY2024’s allocation of $113.3 million. OIT is responsible for overseeing and maintaining the information technology infrastructure for the Executive Branch of the state government.
Language Recommendations: Treasury’s language recommendations include an increase from SFY2024’s allocation of $18.8 million to the $23.8 million to the Supplemental Workforce Fund. Continuing the language recommendations, EDA has been allowed an allocation of $4.5 million for a newly created AI Innovation Challenge Grant. There is also a recommended $25 million from the Clean Energy Fund to the Board of Public Utilities (BPU) for grid modernization.
Department Objective: Treasury is tasked with managing the state’s finances and assets, which includes formulating the state budget, generating revenue, and disbursing funds to run the state government. Its operations extend to managing the state’s physical and financial assets and offering support services to both state and local government entities and the public.
These figures are based on the Governor’s proposal and may change based on public testimony, changes by the Legislature, and discussions with the Administration before its enactment by the end of June. The League will provide further updates as the budget process continues.