There was plenty of reaction to the announcement Friday that Gov. Phil Murphy has reached a deal with the Legislature to borrow up to $9.9 billion to address New Jersey’s budget deficit. All borrowing will have to be approved by the Legislature.
Tom Bracken, CEO, New Jersey Chamber of Commerce:
“I think it was inevitable that some level of borrowing had to take place. I don’t think anybody denied that.
“To me, by setting up this Legislative Committee, they now have control over the amount being borrowed and will limit the borrowing to absolute necessity. I think that’s basically what the Legislature wanted.
“But, it’s a big deal. And it’s unfortunate that we have to borrow, but we do. By controlling it — if the federal government ever gives us money to supplement our needs — that hopefully will allow the amount borrowed to be less.”
Christopher Emigholz, vice president of government affairs, New Jersey Business & Industry Association:
“NJBIA recognizes that borrowing has a place in government fiscal policy, and we are indeed upon extraordinary times where it may be appropriate in a limited manner. However, we find today’s announcement concerning, as it appears to stop short of some of the necessary limits that would make for responsible borrowing.
“We do support the additional approval that would now be required by the new legislative panel for this legislation and appreciate legislators’ efforts to add this potential limit to the borrowing. We also view the potential of 15% cuts in department budgets, as noted by Gov. Murphy today, as a positive.
“But, at the same time, we have continually urged our policymakers about the importance of waiting to borrow anything beyond short-term bonds for cash flow.
“This restraint is critical until we have a better understanding of what our State’s needs are — including the strength of the 2019 tax returns arriving on July 15 and what support we can expect from the federal government — until we do more to reduce spending and until we embark on significant reforms.
“A total of $9.9 billion in bonds with 35-year maturity will cost New Jersey taxpayers at least many hundreds of millions of dollars in additional debt service costs for the next 35 state budgets. New Jersey already is one of the most indebted states in the nation, and this makes our state less affordable now and into the future.
“Ultimately, today’s borrowing will just mean more of our budget will go toward paying debt instead of programs that benefit our residents.”
Regina Egea, president, Garden State Initiative:
“Friday afternoon announcements of backroom deals that show no concern for their constituents is what frustrates taxpayers and discourages residents from remaining in our state.
“Having not even a reference that the ‘commission’ is considering cost reductions prior to authorizing any borrowing tells us all that New Jersey’s debt load just went up by $10 billion this year, with tax increases sure to follow.”
Sheila Reynertson, senior policy director, New Jersey Policy Perspective:
“This deal is great news for residents of New Jersey and will set the stage for a stronger and more equitable pandemic recovery. Borrowing at this level will ensure that the most important public services and safety net programs will be there for everyone, especially families who are already struggling.
“Lawmakers must now work to raise revenue by ending (Gov. Chris) Christie-era tax breaks and require that the very wealthiest pay their fair share in taxes like everyone else. New revenue is necessary for New Jersey’s recovery in now and in the future; it will mitigate further cuts, allow the state to provide relief to those harmed most by the pandemic, and provide the state with ample funds to pay back any money we borrow from the federal government. The only other alternative is austerity — which always harms Black and brown communities the most — and that cannot be an option.”
Read more from ROI-NJ:
- N.J.’s leaders reach deal to allow for up to $9.9B in borrowing
- Republicans pledge to ‘go to court’ to stop $9.9B borrowing plan
- Murphy on potential taxes: ‘Folks who have succeeded’ should help shrink inequities in N.J.