NJ Politics Digest: Finally, Some Good Financial News for the State

It's a good news and bad news kind of situation for New Jersey taxpayers.

New Jersey State Treasurer Elizabeth Maher Muoio in 2017.
New Jersey State Treasurer Elizabeth Maher Muoio. Joan Eddis-Koch/Flickr

It’s a good news and bad news kind of situation for New Jersey taxpayers. The good news is that state revenues are coming in nearly $500 million ahead of expectations. The bad news is that the chances remain slim that the state will provide any programs to reduce what residents pay because Gov. Phil Murphy is using the carrot of property tax relief in an effort to gain support for a plan to increase taxes on millionaires.

Legislative leaders, including members of Murphy’s party, have said they have no interest in raising the millionaires’ tax, claiming that it will only drive high earners out of the state.

Still, there’s more good news in the NJ.com report. The state plans to put any excess money raised into a rainy day fund to provide a cushion if the economy suffers a downturn.

It’s likely that Murphy will also use some of the funds to help pay for his plans to increase pre-K programs and provide free community college tuition to low-income residents if he doesn’t gain his millionaires’ tax—progressive and education union priorities that might have faced pushback in a state where residents already shoulder one of the highest property tax burdens in the nation. It’s unclear if Murphy or state leaders will attempt to use any of the surplus to help further address the looming crisis in state public workers’ pension funds.

The $484 million windfall is funded in large part by an increase of $420.8 million in revenue from the state income tax, according to the NJ.com report. The NJ.com report doesn’t mention any discussions of reducing the tax that is outperforming estimations.

Quote of the Day: “We are very concerned about the substantial power differential between faculty and students, and it’s not clear to us allegedly consensual relationships are consensual,” — Barbara A. Lee, senior vice president for Academic Affairs at Rutgers University, on a move to limit bar faculty from dating undergraduate students.

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