Murphy: Short-term Taxes Jeopardize Long-term NJ Transit Fix

Now that Democratic lawmakers have chosen to advance their own budget plan without the tax increases that Gov. Phil Murphy wants, the governor is finally stepping up efforts to sell his blueprint.

Murphy went to the Trenton train station Tuesday to talk up the proposed NJ Transit subsidy. On Wednesday he plans to address school funding at the Department of Education – spending he said can’t be sustained by temporary tax hikes.

“We can’t have a one-shot or a two-shot infusion once every decade and expect to fund a safe and reliable mass transit system,” Murphy said.

The Legislature’s budget includes the NJ Transit subsidy, though an additional $50 million of it would come from the Transportation Trust Fund for capital purposes rather than the general state budget, and an additional $25 million would come from the New Jersey Turnpike Authority.

Murphy said he sees his first budget as a reset and objects to relying on so many temporary revenues – roughly $1 billion, he estimates.

“We cannot do this from year to year. We cannot enter every June in crisis, trying to figure out how we’re going to keep the lights on, let alone invest in the big things New Jersey needs,” Murphy said.

Lawmakers say long-term sustainability comes from saving money on other items in the budget.

The Legislature’s budget counts on $805 million from a tax surcharge on around 2,400 corporations – either 2.5 percent or 4 percent, depending on profits, with the biggest companies paying the nation’s highest business tax rate. It would sunset after two years.

“It’s two years for one reason: We have a spending problem,” said Senate President Steve Sweeney, D-Gloucester.

After two years, things like the NJ Transit subsidy could be afforded due to other spending cuts, Sweeney said. Murphy said that can’t be accepted with a straight face, given that transit funding from the state budget was at one point cut by 90 percent.

“So it’s not a spending problem. We’ve got a priorities problem,” Murphy said.

Despite Murphy’s continued opposition and veto threat, the Senate and Assembly budget committees Tuesday voted to advance the alternate budget of $36.5 billion.

Even the leaders of the Senate and Assembly budget committees sounded like they didn’t expect that it would be the next-to-last step in this year’s legislative process.

“We are hopeful, I am hopeful and confident, that between the continued dialogue between the governor, the Senate president and the speaker that we will get there and have an agreement that’s signed into law well in advance of June 30,” said state Sen. Paul Sarlo, D-Bergen.

“I don’t think that this is the perfect bill,” said Assemblywoman Eliana Pintor Marin, D-Essex. “I’m not sure that this is the end-all, be-all. I look forward to the next portion of this and having those conversations.”