Cutting spending will close $132M shortfall, treasurer says

TRENTON – New Jersey’s Treasurer says the state plans to fill a $132 million budget shortfall by cutting spending.

Treasurer Andrew Sidamon-Eristoff told lawmakers Fiscal Year 2013 revenues will be $132 million shy of revised projections, forcing the state to trim spending to fill the deficit. The FY 2013 shortfall was filled by reducing supplemental spending by $93 million and lapsing $74 million in unspent funds, according to the Treasurer.

The treasurer also announced adjusting FY 2014 revenues downward by $33 million – signaling a $165 million shortfall through the next fiscal year.

“Simply stated, most of the reduction is due to the fact that we quite recently received confirmation that two energy-related revenue sources will fall significantly short of our expectations,” said Sidamon-Eristoff, citing the energy sales tax.

“The sales tax on energy companies will fall short by $140 million, or over 40 percent, and the corporation business tax on energy companies will fall $43 million, or 68 percent, short of expectations,” he said.

The testimony comes after the non-partisan Office of Legislative Services alerted lawmakers about a significant reduction in energy tax revenues.

OLS’ chief budget officer, David Rosen, projected a $937 million shortfall through the next fiscal year. Rosen said $348 million of the shortfall is directly tied to the loss in energy tax revenues.

Cutting spending will close $132M shortfall, treasurer says