Business, policy leaders mostly agree: Budget proposal is bad for business

By ROI-NJ Staff
Trenton | Mar 5, 2019 at 4:40 pm

How the heads of some of the state’s top business groups and economic policy think tanks reacted to Gov. Phil Murphy’s budget address:

We cannot afford yet another tax increase

Tom Bracken, president, New Jersey Chamber of Commerce

“We applaud the changes he proposes to the public employee and retiree benefit programs and the reduction in state government expenses, which will save more than $1 billion. We agree with his proposed investments in education and infrastructure, and we support the strengthening of economic investment programs to retain and attract business to New Jersey.

“However, the New Jersey Chamber strongly opposes the governor’s proposal to increase the tax rate on those who make the investments and create new jobs in New Jersey.

“New Jersey cannot afford yet another tax increase, and the New Jersey Chamber believes the $447 million — out of a $38.6 billion budget — to be raised by this tax increase can be found through a more aggressive and much-needed cost efficiency initiative across all of state government.

“The pain from this new tax would be severely disproportionate to its benefit.”

Today’s proposal will not improve the outlook for N.J. businesses

Michele Siekerka, CEO and president, New Jersey Business & Industry Association

“NJBIA appreciates Gov. Murphy’s efforts to prepare a FY 2020 state budget that is fiscally sound, drives economic growth and makes investments in New Jersey’s future.

“We also appreciate the governor’s efforts to offer significant health care savings in this budget, as we and others have advocated, to bring more fiscal responsibility to our state. However, this proposed budget also adds nearly an equal amount of spending. It increases New Jersey’s overall budget by 3.2 percent compared to last fiscal year and 11.2 percent from FY 2018.

“To balance this additional spending, Gov. Murphy again looks to increase taxes on an already-overtaxed state. Today’s proposal will not improve the outlook for New Jersey businesses, which saw tax increases and a wave of costly mandates over the past year that collectively strike hard at profit margins and overall competitiveness.

“In addition, lowering the threshold for the top gross income tax rate will continue to encourage the outmigration of wealth from the state. New Jersey has a net loss of nearly $25 billion in adjusted gross income over the last 12 years of available data. This will continue if more individuals have to pay a top income tax rate, which ranks as the third-highest in the nation, and the highest in our region.”

Governor needs to focus on business and growing our tax base

Anthony Russo, president, Commerce and Industry Association of New Jersey

“We hope the governor and his team will do a deeper dive to find additional savings and cut expenses, as opposed to a millionaire’s tax,” Russo said.

CIANJ applauds the effort to tighten the state’s belt and cut costs by $1.1 billion, but questions how the overall spending package will be supported.

“This year’s revenue growth is not meeting expectations and the shortfall needs to be addressed,” said Russo. “We cannot spend what we don’t have — revenue has been disappointing and a tougher look at the state’s spending package must be undertaken.

“The governor needs to focus on business and growing our tax base. He needs to view businesses as partners and that is ultimately how all residents will thrive.”

Sweeney, Coughlin need to hold the line on taxes

Regina Egea, president, Garden State Initiative

“The question I recall from my time in both the treasurer’s and the governor’s offices each February was: ‘How can we reduce our state’s crushing tax burden?’ Today, we now know the only question being asked in those offices is: ‘How can we spend more, tax more and drive more New Jerseyans away?’

“This administration has failed to grasp what the IRS data has already told us: Taxpayers are mobile. Shouldering an ever-larger tax burden, our neighbors have been fleeing our state and taking tax revenue with them.

“Today’s budget address may as well have been sponsored by the Florida or North Carolina chambers of commerce. Doubling down, as this governor is, on spending more each year without acknowledging the damage being done to our economy and tax base is the definition of reckless.

“It is imperative that Senate President Steve Sweeney and Assembly Speaker Craig Coughlin are responsible leaders and keep their word to hold the line on no new or higher taxes. They have demonstrated strong conviction on many issues over the last year. Now is the time to show up for New Jersey and stop the irresponsible and damaging polices of the Murphy administration.”

This is a fiscally sound vision that invests in N.J.’s greatest assets

Sheila Reynertson, senior policy analyst, New Jersey Policy Perspective

“The budget outlined by Gov. Murphy sets a foundation for shared prosperity and fiscal health. It pairs significant cost savings with continued investments in critical programs and services, while also committing to a healthy surplus that will safeguard the state from future economic downturns or natural disasters. Simply put, this is a fiscally sound vision that invests in New Jersey’s greatest assets, while lifting up the most vulnerable families in the state.

“Further, we commend Gov. Murphy for centering his speech on the state’s role in providing opportunities to help New Jersey families thrive in a variety of ways, including increased funding for affordable homes, expanding free community college, covering birth support for black mothers, and increasing the Earned Income Tax Credit.

“We also applaud Gov. Murphy for his commitment to tax fairness and his inclusion of a true millionaire’s tax in his budget proposal. Given the state’s growing income inequality, racial disparities and lopsided tax code, asking New Jersey’s wealthiest individuals to pay a little bit more is the definition of fairness. This overdue change in the tax code will impact less than 1 percent of tax filers, many of whom just received a generous tax break from changes to the federal tax code. The additional funds from a millionaire’s tax will help to fund the state’s property tax relief programs and allow the state to continue investing in services that benefit all New Jerseyans.”

Investing in infrastructure upgrades is smart move

Peter Kasabach, executive director, New Jersey Future

“New Jersey Future is encouraged by the governor’s commitment in his budget address to investing in critical infrastructure upgrades, particularly NJ Transit.

“Reliable public transportation is vital to the success of our cities and to meet the increasing demand for housing near transit, but this is not the only type of infrastructure in need of investment.

“Our water infrastructure is in desperate need of repair and we hope to see funding for this in the next budget.”

Read more from ROI-NJ on the budget:

ROI-NJ Staff | editorial@roi-nj.com | @ROINJNews