On Tuesday and Wednesday of this week, the non-partisan Office of Legislative Services (OLS) and State Treasurer Elizabeth Maher Muoio presented revised revenue estimates for the State’s current (FY ‘19) Fiscal Year and the State’s upcoming (FY ‘20) Fiscal Year. With April’s income taxes in the bank, and with the State’s other revenue streams more fully accounted for, New Jersey’s budget outlook is now brighter than it was when the Governor presented his plan to the Legislature in March.
OLS now advises the Legislature to anticipate $38.1 billion in the current year and $38.7 billion for FY ’20. The Treasurer expects the State to take in about the same amount as OLS forecasts for this year, and about $39 Billion, for use in FY’20. That increases anticipated revenues, above the amounts incorporated into the Governor’s March proposal, by $377 million this year, and by $240 million for next year.
For the purpose of forecasting, both OLS and the Treasurer base their estimates on the assumption that the Legislature will approve the Governor’s proposed revenue enhancements, including the refined "millionaires’ tax."
State law requires the deposit of 50% of revenue gains, above those that were anticipated when the State’s FY ’19 Appropriations Act was adopted (last July), into the Surplus Revenue (or Rainy Day) Fund. Treasurer Muoio expects to be able to credit $317 million to that account, which is meant to guard the State against a recession or other budgetary emergency.
The Governor will also ask the Legislature to use $250 million of the new-found funding, to adopt a one-year property tax relief program, to be delivered through refundable tax credits. Treasury expects over 1 million property taxpayers to benefit from the program.
Respected State government correspondent Colleen O’Dea recently noted in an NJ Spotlight report, “Municipal services account for about $3 of every $10 paid in property taxes. (The rest goes for schools and counties.) And while the Consumer Price Index has risen by 21% from mid-2007, total municipal aid is almost 11% less than 12 years ago.”
An across the board increase in municipal property tax relief funding would, we believe, benefit all New Jersey property taxpayers.
We will keep you posted on other developments, as the State moves toward the June 30 budget adoption deadline.
Contact: Jon Moran, Senior Legislative Analyst, jmoran@njlm.org, 609-695-3481 x121.