No New Taxes in Gov. Murphy’s Proposed 2024 Budget 

Gov. Phil Murphy presented his budget priorities for Fiscal Year 2024 during an address that continued his push for the Next New Jersey.

The $53.1 billion spending plan—rising approximately $3 billion from last year—includes a proposed surplus of $10.1 billion that Murphy Administration officials say redirects nearly 74% of the total budget back out in the form of grants-in-aid for property tax relief, social services, and higher education as well as state aid to schools, community colleges, municipalities, and counties.

Murphy summed up his budget as having “more tax relief, more help for businesses to grow and create good-paying jobs, more investments to build a green economy and fight climate change, more affordable prescription-drug assistance for seniors, more child care for young families, more help to buy your first home and to stay in your current one, more commitment to making sure every child has access to health insurance, more public school funding and more help to bring new educators to New Jersey’s classrooms, more support for the kids who need it, and more attention to the bottom line to pay down our debts and secure the largest property tax relief program in our history.”

Addressing Affordability 

Speaking for just over 50 minutes, Murphy said the through lines for his budget were affordability, community, competitiveness, fairness and jobs as “the Next New Jersey isn’t some far-off vision. The Next New Jersey is here and happening right now.

“Building the Next New Jersey means creating an economic future that uplifts each of us and works for all of us. My proposed budget will help New Jerseyans secure their place in our future by expanding opportunity now,” said Murphy. “From growing and strengthening the middle class to improving affordability for hardworking families, we will continue to make our state the home of the American Dream.” 

Speech Highlights

Among the proposals that Murphy highlighted to the joint session of State Senators and Assembly members Feb. 28 to be approved by the Democratic-controlled legislative bodies includes:

• a fully funded second year of ANCHOR that offers direct property tax relief of up to $1,500 for homeowners and $450 for renters;
• doubling the state Child Tax Credit up to $1,000 per child;  
• a third consecutive full payment into the state pension funds; and 
• a sixth straight year of no fare hikes on NJ Transit. 

Investments in education took up major sections of the speech, including providing an additional $830 million in direct aid; the continued expansion of Universal pre-K with an increase of $110 million this year; $15 million in stipends for student-teachers and waiving of teacher-certification fees to address the teacher shortage; increasing Tuition Assistance Grants for over 20,000 recipients; and committing $10 million more for high-impact tutoring to combat learning loss from the pandemic.

Fighting Inflation

Besides the ANCHOR program, Murphy offered that the state’s investment in education can be seen as offering tax relief to taxpayers, an issue he noted has been heightened by inflation. The second term governor said the effects on inflation on Garden State residents pocketbooks was foremost in his team’s thoughts as they crafted the proposed legislation. 

“You’ve been paying more for everything from gas to groceries, and your paycheck hasn’t kept up,” he said. “So, know this—this budget was built with you in mind and to secure your place. It provides more direct tax relief to help folks out from under stubborn inflation which makes it hard to cover the basics.”

To help businesses that have felt the effects of inflation as well, Murphy said he is allowing the 2.5% corporate business tax surcharge to expire after hearing from the business community.

“We (heard) that allowing this surcharge to lapse will mean more money for them to create jobs, to invest in new and more efficient equipment, to lower costs to consumers, and to be able to stay here,” said Murphy. “So, just as they’ve trusted us to keep our word in letting this temporary surcharge expire, I’m expecting them to keep theirs with this revenue.”

Helping Seniors

Attracting and retaining families in New Jersey was highlighted by two programs. The budget will expand the Senior Freeze property tax relief program and increasing income eligibility to $150,000 and removing other roadblocks to eligibility, offering additional property tax relief for 50,000 more seniors. And the state is hoping to put home-ownership back within reach of younger buyers through a $15 million investment in First-Generation Homebuyer Down Payment Assistance. 

“New families and longtime homeowners side by side—that’s what makes a community,” said Murphy. “This budget will see to it that our communities remain welcoming to every family.”

Among the healthcare initiatives for seniors, the budget will extend eligibility for the Pharmaceutical Assistance for the Aged and Disabled (PAAD) and Senior Gold programs to further cut the costs of prescription drugs. And Murphy urged for the passage of a bill currently moving through Trenton that will help lower costs for more life-saving medicines such as insulin.

“That’s real money for countless seniors and others on fixed incomes,” he said. “And together, we can allow even more New Jerseyans to enjoy these savings.” 

Use of Federal Funds

The governor said he will earmark American Rescue Plan funds to continue upgrading and replacing aging water infrastructure as well as preserving affordable housing and creating urban workforce housing “to support the families and dreams of those who are living on the front lines of the reinvention of our cities.”

Murphy additionally proposed a new Urban Investment Fund to work alongside the current business incentive programs to support the arts and the creation of parks and gardens that will “help our cities not just become more inviting for new residents, but for workers returning to downtown offices.

Two items from his State of the State were highlighted as well—brand-new $100 million Boardwalk Fund to partner with Shore towns and counties to ensure that the “wooden main streets which are the backbones of their communities remain just that” and a pitch for reforming the state’s antiquated liquor licenses. 

Continue Push for Clean Energy

An area that he has received heavy criticism from Republicans, Murphy said the state must continue its push for clean energy that supports goals like a 100% clean-energy economy by 2035, investments to build out statewide electric vehicle infrastructure, moving more of the housing and commercial building stock away from fossil fuels and toward energy-efficient heating and cooling technologies as well as helping local governments buy zero-emission trucks.

“This is how we take on the challenge of climate change. This is how we build a more resilient and sustainable future. This is how we invest in the jobs of tomorrow,” he said.

The Democratic governor defended the state’s reentry into the Regional Greenhouse Gas Initiative (RGGI) as well. Among the actions planned in coordination with RGGI include creating a new $40 million Green Fund to be administered by the Economic Development Authority, as well as pump $12 million more back into the Clean Energy Fund.

“Leaving RGGI was a failure of leadership. It was a fiscal failure that cost us nearly $280 million,” he said. ”We’ve only been back in RGGI for three full years. In this time, alone, we have pulled in more than $365 million. And we’re putting this money to work to build a more sustainable and resilient future for our kids and grandkids, and those who will follow.”

Improving State’s Economic Health

Another area that Murphy criticized Gov. Chris Christie without naming him was when told those assembled that the state’s financial footing is now secure and prepared for an economic downturn with its record surplus that is almost 20% of the state’s budget.

“Should one occur, we will be on a far stronger footing to react in real time to ensure that critical investments can continue…that our economy can be backstopped,” he said. “This kind of rainy-day thinking had previously been absent in Trenton. It’s why, during past recessions, we were slow to react and even slower to recover.

The former Goldman Sachs executive said that over the past five years, his administration “has strengthened our foundation more than any administration in decades, and this budget will continue to reinforce our fiscal standing.”

Credit Upgrades

“But we cannot make these investments unless our fiscal foundation is strong enough to sustain them,” he said. “This is why this budget is also centered around fiscal responsibility. We’ve embraced a radical philosophy for Trenton: Pay your debts and don’t spend more than you make.”

Murphy promoted that New Jersey in a span of six months last year received three credit-rating upgrades from Wall Street firms. 

“We worked hard to put New Jersey in position to get its first credit upgrades in nearly two decades—and only a few short years after the prior administration oversaw 11 consecutive downgrades, leaving our credit perilously close to “junk” status,” he stated.

July 1 Deadline

“This was welcome news not just for the state, but for every taxpayer,” he said. “Our taxpayers get this. They know when their credit score goes up, their interest rates go down, and more of their money stays in their pockets. That means they can get more at the supermarket, or put more away for a child’s education, or for a new car or home.”

“It’s the same thing for the state – except we save money on things like new roads and bridges and new schools. And when we save money, every single taxpayer saves money. This budget is designed to support the next round of credit upgrades. It is designed to build even greater confidence in our direction and in our ability to honestly meet our obligations.” 

Murphy and legislators will now begin the process of committee hearings and budget proposals to pass the 2024 budget. The state constitution mandates a balanced budget with no deficit must be ratified by July 1.