Governor Phil Murphy delivered his sixth annual budget address in February, outlining a spending proposal for Fiscal Year 2024 (FY2024).
Murphy’s budget proposal, which will be hammered out in the legislature in the coming months before the end-of-June deadline, appropriates $53.1 billion, with a huge $10 billion surplus. That’s higher than last year’s already large surplus and dwarfs the budget surpluses New Jersey was seeing when Murphy took office. State Treasurer Elizabeth Maher Muoio said tax collections are expected to “stabilize,” with small increases in the income and sales tax collections expected in the new fiscal year, though the tax rates themselves will remain unchanged. The new surplus would represent 19% of the proposed budget, marking the highest percentage allocated to surplus in 13 years, but would still lag the national average among states of about 25%, according to Muoio.
Overall revenues are projected to drop in the coming fiscal year by less than 1% due largely to the sunsetting on Dec. 31 of the 2.5% corporate-business tax surcharge, a revenue reduction of $421 million. Realty transfer fees, transfer inheritance taxes and investment earnings are also expected to drop.
The budget proposal also includes a $100 million Boardwalk Fund that Murphy previously proposed to assist shore communities and add another $50 million to increase “green energy” jobs.
Key Highlights
ANCHOR Program
More than 1.5 million families will receive direct property tax relief through the ANCHOR program. A middle-class family making just under $125,000 and paying an average of $9,400 in property taxes is going to receive $1,500 in direct relief. Renters will receive $450.
Child Care
The Governor proposes doubling the state Child Tax Credit up to $1,000 per child and working towards universal pre-K with a more than $1 billion total investment, an increase of nearly $110 million over this current year.
Seniors
Expands the Senior Freeze property tax relief program – increasing income eligibility to $150,000 and removing roadblocks to eligibility. That means additional property tax relief for 50,000 more seniors.
Home Ownership
Provides $15 million investment in First-Generation Homebuyer Down Payment Assistance.
K-12 Schools
Provides an additional $830 million in direct aid to K-12 public schools, for a total of almost $11 billion, and commits $10 million more for high-impact tutoring; a total of nearly $300 million. Launches the New Jersey Statewide Student Support Services (NJ4S) network to help countless more students focus on mental health wellness.
Budget Strength
Sets aside more than $2.3 billion for debt relief. Creates a surplus of more than $10 billion – nearly 20% of this budget.
Teachers
Supports a total of $15 million in stipends for student-teachers and waiving of teacher-certification fees.
NJ Transit
Sixth year in a row of no-fare hikes. Continued investment directly into the system.
Tourism
Creates a $100 million Boardwalk Fund to partner with shore towns and counties. Second year in a row of forgoing state park fees.
Clean Energy
The Governor supports getting to a 100% clean-energy economy by 2035, moving the state to an electric vehicle fleet, and assisting localities to do likewise. Creates a $40 million Green Fund to be administered by the Economic Development Authority and pumps $12 million more back into the Clean Energy Fund. This also includes NJ's reentry into the Regional Greenhouse Gas Initiative.
Businesses
The budget allows the 2.5% Corporate Business Tax surcharge to expire. Also focuses on updating New Jersey’s antiquated liquor license laws.
