The annual budget address always has predictable responses — and Gov. Phil Murphy’s offering on Tuesday was no exception.
Members of the party in power (Democrats) loved it; those in the minority (Republicans) hated it.
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Leaders of business groups want more for business owners (helping to replenish the unemployment trust fund came up often), while think tanks went the direction of how they lean.
The only thing remaining was to see which nonprofit felt the progressive governor wasn’t doing enough. No worries, we found that, too.
With that, here are nine reactions to Murphy’s proposed budget:
Tom Bracken, CEO, New Jersey Chamber of Commerce
In his speech, the governor cited the growth performance of the state economy and cited a number of indicators to support his claim. But the real question is, how does New Jersey’s economic improvement compare to that of other states? That is the real measure of economic progress.
The pandemic has left lingering issues in the business community — capital shortage, labor shortage, and inflation — that we must address if New Jersey’s economy is to experience a full-throttle economic recovery. The budget address was silent on these.
The funding to provide the necessary level of help is available with the remaining American Rescue Plan dollars, yet the money sits unused.
If now is not the right time to invest American Rescue Plan dollars in the recovery of New Jersey’s businesses — when will the right time come?
The New Jersey Chamber repeats again that it is the New Jersey business community that will create the jobs that will ignite our state’s full economic recovery, and it is the same New Jersey business community that will pay the taxes to fund the programs that represent the “fair” side of Gov. Murphy’s economic vision.
But what we heard today does little to make New Jersey’s economy stronger, which is the other side of Gov. Murphy’s economic vision.
Michele Siekerka, CEO, New Jersey Business & Industry Association
While this is the very start of the budget process, we are frustrated that this budget does not speak to direct affordability for our small businesses. With nearly one-third of small businesses shut down during the height of the pandemic and business closings still occurring on a regular basis, these surviving employers, who have seen little in the way of tax incentives, are still very much in need of assistance.
One immediate way to help them is to address the nearly $1 billion in unemployment insurance tax hikes that New Jersey businesses are now slated to pay over three years for an unemployment crisis they did not create. This should not be overlooked amid the fanfare of “no new taxes” in the FY23 budget.
There are also no tax cuts in this budget for New Jersey businesses, which continue to pay the highest corporate business tax in the nation — again, at a time when revenues overperformed. Additionally, the state continues to tax the foreign income of our corporations more than any other state.
The governor repeatedly says, and we concur, that small businesses are the lifeblood of New Jersey’s economy. As such, we should have expected that this budget would provide them with an affordability shot in the arm, not a swing and miss. We hope the administration will work with the Legislature to provide these employers the relief they deserve.”
Christina Renna, CEO, Chamber of Commerce Southern New Jersey
As with everything, the devil is in the details. CCSNJ looks forward to evaluating the details of Gov. Murphy’s proposed FY2023 state budget to better understand the ways in which it helps the small businesses community, which is so in need, as well as the overall South Jersey region. It’s undeniable that the FY2023 state budget is bloated at $48.9 billion, which is an approximate 5% increase in spending over the FY2022 proposal and a nearly 31% increase over the governor’s first budget in FY2019.
Although the CCSNJ is always pleased when no new taxes are proposed, those in the business community have already faced a tax increase due to the automatic unemployment insurance tax, which went into effect last fall and will continue to increase over the next two years unless state government uses federal funds, as other states have done, to offset future increases on employers.
Tony Russo, president, Commerce and Industry Association of New Jersey
We applaud the increase in funding to workforce development, apprenticeship programs and the Main Street Recovery Fund, which has been a lifeline to many small businesses in the state. We are also encouraged by the new ANCHOR property tax relief program for renters and homeowners, but we would like to see a similar property tax relief program for businesses as well. However, CIANJ would like to see more of the federal money New Jersey has received being used to replenish the unemployment insurance fund and pay down even more of the state’s debt.
Associations, think tanks, nonprofits, labor
Ralph Thomas, CEO, NJ Society of Certified Public Accountants
We applaud the governor for proposing a budget that includes no tax increases or new fees. The NJCPA also commends the governor for once again including a full payment to the public worker pension fund, though structural reform to public worker benefits is necessary to end the ballooning burden of these benefits on the state budget. We also applaud the governor for making a large allocation to debt defeasance.
However, we are disappointed that this budget does little to address the affordability issue facing small businesses. Small businesses were hit hard by the COVID pandemic and yet there is no money in the budget to provide relief for the $1 billion tax increase necessary to replenish the Unemployment Insurance Trust Fund that was drained during the pandemic. While most states have used federal relief funds to eliminate or reduce that burden, New Jersey has not. We urge lawmakers to make UI tax relief a key part of the budget discussions.
Ignoring businesses does not help low- and middle-class New Jerseyans. It hurts them. A thriving economy is necessary to provide jobs and other benefits for New Jerseyans. Everyone benefits when businesses do well.
Regina Egea, president, Garden State Initiative
Last November, New Jersey’s voters sent a loud and clear message to Trenton that reducing our state’s crushing tax burden and high cost of living must be at the top of the agenda. States across the country, red and blue alike, are offering significant tax cuts to their residents. By putting more money in their citizens’ pockets, they are growing their state economies and reducing unemployment. Unfortunately, the proposed state budget follows the tried-and-true playbook of New Jersey government unilaterally spending more, not less. Picking short-term winners and losers through gimmicks like “relief checks” and increased municipal aid do nothing to address affordability. That’s simply replacing one tax with another.
New Jerseyans are smart enough to understand that the power of appropriations belongs to the Legislature; and state legislators should be smart enough to heed the warning the voters delivered last November. Present a budget that offers real tax reductions, not shell games that offend the voters they will face again in 15 months.
Jon Shure, interim president, New Jersey Policy Perspective
Gov. Murphy’s budget proposal recognizes that you can’t cut your way to prosperity. Affordability doesn’t come from reducing public investments that help people get ahead, but by funding the building blocks of strong communities. This year’s budget increases investments in education at every level, expands access to affordable health care and funds the creation of new, affordable homes. These sorts of investments are how we build an economy from the bottom up and the middle out — not the top down.
Peter Kasabach, executive director, and Chris Strum, managing director, New Jersey Future
We were pleased to see the governor emphasize the importance of making New Jersey an affordable place to live and make a significant commitment to subsidized affordable housing production. But more needs to be done to produce housing in the right places. Housing and transportation are important twin pillars of household affordability.
We didn’t hear how the state will be incentivizing new housing that will keep household transportation costs down or places that are walkable and accessible to public transit. The Legislature is looking to tackle these twin issues with initiatives that will make it easier to build more housing near train stations, in our downtowns, and even in the extra spaces we currently have on our properties. We hope the governor will recognize the importance of producing more housing options in transportation-affordable locations and support and invest in these efforts.
Officers, New Jersey Education Association
Gov. Murphy’s first budget of his second term expands the commitment he has made to families for the past five years. His budget shows that he intends to keep his promise to make New Jersey both more affordable and more attractive for the hard-working families who are propelling our economic recovery.
That commitment begins with his unwavering determination to fully fund our public schools, which remain the best in the nation. By pledging an additional $650 million in aid to local school districts, he has ensured that our students will continue to have access to the resources they need to learn and thrive. We also applaud his commitment to invest an additional $430 million in school construction and renovation to ensure that our students are learning in schools that are safe, healthy and designed for academic success.
We thank Gov. Murphy for his continued dedication to making higher education more affordable, particularly at New Jersey’s many excellent community colleges. By making more families eligible for the Community College Opportunity Grant, Gov. Murphy’s budget continues to create pathways to success for New Jersey residents who have for too long been excluded from higher education. We continue to urge the state to increase direct aid to county colleges as well, to ensure that they can keep tuition low and still build the vibrant educational programs our students need.
President Sean M. Spiller, Vice President Steve Beatty and Secretary-Treasurer Petal Robertson wrote this opinion.