NJ Politics Digest: Murphy Signs Budget After Face-Saving Vetoes

Gov. Phil Murphy has signed the New Jersey state budget, ending a months-long drama in Trenton and avoiding a government shutdown.

New Jersey Governor Phil Murphy delivering the 2019 New Jersey State of the State address in the Assembly Chambers at the New Jersey State House in Trenton.
New Jersey Gov. Phil Murphy approved the $38.7 billion state budget Sunday. Michael Brochstein/SOPA Images/LightRocket via Getty Images

Gov. Phil Murphy on Sunday signed the New Jersey state budget and announced he’d be line-item vetoing $48.5 million, or just 1.25 percent, of the $38.7 billion spending plan the Democratic legislature sent to him, ending a months-long drama in Trenton that saw the governor unable to gain traction for new taxes to fund his progressive agenda.

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Murphy also “impounded,” or froze, $235 million more in spending until revenues to projected to pay for the measures are assured, according to a report by NJ.com.

It’s unclear if the legislature will attempt to override the governor’s vetoes, which include cutting $5 million budgeted to enable Cooper University Hospital to improve access to care for poor communities and $38 million that could have been used to study school district consolidation. Consolidation—and the reduction of duplicate services it would enable—is considered one way to help reduce property taxes in the state, which has among the highest tax burdens in the nation.

Both vetoes were seen as Murphy attempting to pay back his political enemies who had boxed him into a corner in the budget fight. South Jersey Democratic political boss George Norcross, seen as one of Murphy’s arch foes, is chairman of Cooper University Health Care. Senate President Steve Sweeney, a Democrat like Murphy who blocked the governor’s call for a millionaires’ tax, has been pushing a plan to put the state on a more sustainable fiscal path that includes reducing public employee benefits and consolidation of services. Murphy, who is closely allied with the state’s public workers’ unions, has refused to consider such reforms. Sweeney said the budget was balanced without the millionaires’ tax and warned that raising the rate on the state’s highest earners would just force them to choose another state as their primary residence—leaving New Jersey without their tax revenue.

The New Jersey Chamber of Commerce praised Sweeney and Assembly Speaker Craig Coughlin for resisting the millionaires’ tax, and said it was happy state leaders passed a budget without having to resort to shutting down state government, according to NJ101.5.

But the New Jersey Business & Industry Association said the budget is an 11 percent increase from last year, and that the state can’t afford to continue to increase spending at such a rate while not addressing pressing fiscal problems, such as the hundreds of billions that will be needed to fund public employee pensions.

Quote of the Day: “I’m pretty happy that the governor recognized that we gave him a very sound, fair budget. That’s what he said today. He said in the past he’s gotten 95 percent of what he asked for in the budget. We think the budget we gave him is sound, healthy, fair [and] deals with a lot of issues of importance,” — Senate President Steve Sweeney.

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NJ Politics Digest: Murphy Signs Budget After Face-Saving Vetoes