TRENTON, N.J. (AP) - New Jersey’s 2017 and 2018 budgets face uncertainty and an estimated roughly $440 million shortfall, nonpartisan legislative forecasters told the Democrat-led Assembly on Wednesday, but the Republican Christie administration says the budget is making “significant progress” toward integrity.
The Assembly budget committee got revenue updates on Wednesday from the nonpartisan Office of Legislative Services and Treasurer Ford Scudder as they consider Christie’s $35.5 billion 2018 proposal. Lawmakers and the governor face a June 30 deadline to enact a balanced budget. The Senate budget committee will hear from Scudder and legislative forecasters Thursday.
The estimated shortfall is small compared to previous gaps Christie faced. Lawmakers and Scudder said they’ll have a clearer picture where the state’s revenues stand after the April tax season ends.
A closer look at the issue:
RISKS AND PROJECTED SHORTFALLS
Legislative budget forecasters predicted that 2017’s revenues will come in $223 million below projections and 2018 will fall $213 million under what Christie predicts. Those differences are small compared to the overall size of the budget and in relation to earlier Christie years when shortfalls resulted in slashing the pension by $1 billion.
For 2017 legislative budget forecaster Frank Haines specifically pointed to an estimated $140 million in legal settlements as an area of uncertainty. In 2018, he pointed to the administration’s expectation of $325 million from the sale of assets including broadband spectrum. “The revenue side of every budget entails forecast risk,” he said.
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’SIGNIFICANT PROGRESS’
Scudder pointed to the state’s falling unemployment rate, down to 4.4 percent from a high of nearly 10 percent when Christie took office, and increased pension payments over Christie’s tenure as well as the reduction in new debt as signs of budget sustainability. “We continue to make significant progress in the structural integrity of the budget,” he said.
Still, the administration reduced its projection for the current year revenues by $247 million. Scudder added he expects the strong stock market in 2016 to result in a growth in payments.
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’SOUNDS LIKE A LOT OF MONEY’
The difference between the forecasters and administration projections doesn’t worry Budget Committee Chairman Gary Schaer. “Although it sounds like a lot of money… in the scheme of things it’s really not.” What concerns him, he said, are the tax receipts that are due in the coming weeks. If the figure is down significantly the state could have a problem.
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