New Jersey April Revenue 5.3% Below Christie’s Forecasts
New Jersey’s April revenue was 5.3 percent below Governor Chris Christie’s targets as income and business taxes fell short, leaving collections $230 million behind forecasts for the first 10 months of this fiscal year.
The state collected $3.26 billion last month, less than its projection of $3.44 billion. Income taxes were 2.8 percent less than forecast and corporate levies were 22.1 percent under budget, Treasurer Andrew Sidamon-Eristoff said in a statement.
Christie, 49, a first-term Republican, had predicted that April revenue would rise from $3.32 billion a year earlier. He has touted the “Jersey Comeback,” saying that tax cuts are possible now that the state’s “fiscal house is in order.” His $32.1 billion spending plan for the fiscal year starting July 1 predicts a 7.3 percent increase in revenue, the most since before the recession that began in December 2007.
“It’s now becoming clear the governor has built his plan on a shaky foundation,” Assembly Majority Leader Lou Greenwald, a Camden Democrat, said in a statement. Christie declined to comment after a hospital groundbreaking in Camden.
Christie is counting on a revenue gain to fund a 10 percent across-the-board income-tax cut. He has prodded Democrats, who control the Legislature, to pass his plan. Lawmakers have made counterproposals that would give middle-class residents property-tax credits on income-tax returns.
Senate President Stephen Sweeney, a West Deptford Democrat, told reporters after the groundbreaking that the April revenue drop won’t derail his discussions with the governor on a tax-cut compromise. Christie wouldn’t comment on the talks.
Sweeney also said it’s too early to tell what effect the drop will have on the budget.
“April is important, but so is May,” Sweeney said. “We’ll have to look at May’s numbers before we get the real final picture.”
Standard & Poor’s said in February that Christie’s spending plan for fiscal 2013 relied on “optimistic” revenue assumptions. David Rosen, chief budget analyst for the Office of Legislative Services, said in March that revenue for this fiscal year and next may trail Christie’s targets as taxes on income and casinos fall short.
New Jersey isn’t the only state to fall short of revenue forecasts. California Governor Jerry Brown said yesterday he overestimated tax receipts by $4.3 billion when he unveiled his budget in January. Now confronting a $15.7 billion deficit, he proposed spending cuts including a four-day government workweek.
In New Jersey, March collections missed estimates by 2.5 percent, according to the treasury, as income-tax revenue trailed by 6.4 percent. Receipts for the nine months through March were 0.3 percent less than forecast.
Including April, revenue this fiscal year is 1.2 percent below projections, the treasurer said today. April is typically the largest month for income-tax collections because it includes the filing deadline.
Kevin Roberts, a spokesman for Christie, said that revenue so far this fiscal year is $500 million, or 2.7 percent, higher than the same period of 2011, as the economy grows.
“The administration and treasury every single day, month in and month out are carefully monitoring the revenue picture,” Roberts said. “This is one month’s worth of collections. We still have two months of revenue.”
Collections for fiscal 2012 stand at $19.3 billion, up from $18.8 billion a year earlier. Income-tax revenue is 2 percent higher than the same period of fiscal 2011, while sales levies are up by 3.1 percent and collections from businesses are 0.7 percent higher, according to the treasury’s report.
“While April’s revenues were somewhat below expectations, reliable indicators show that New Jersey’s economy continues to grow,” Charles Steindel, the treasury’s chief economist, said in the statement.
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