New Jersey’s Revenue Shortfall May Exceed $400 MillionTerrence Dopp
New Jersey revenue may be short of Governor Chris Christie’s projections by more than $400 million, according to the legislature’s chief fiscal analyst.
While the largest shortfalls this fiscal year are from the income and business taxes, nearly all revenues trail the administration’s expectations, David Rosen of the nonpartisan Office of Legislative Services said in a memo to lawmakers that was obtained by Bloomberg News.
Figures released last month by the state treasury department showed collections for the six months ended Dec. 31 trailing Christie’s forecast by 3 percent, or $331.7 million. While the treasurer hasn’t provided a revenue report for last month, Rosen said his forecast is based on actual collections reported in the accounting system through January.
The memo was sent less than a week before Christie, 51, a second-term Republican, is scheduled to present his budget for the fiscal year that begins July 1.
“All matters of revenue and expenditures in the state budget will be addressed by Governor Christie in his budget address Tuesday and by Treasurer Sidamon-Eristoff,” said Kevin Roberts, a spokesman for Christie. He declined to comment further.
New Jersey will face challenges improving its finances because of a “sluggish economic recovery” that’s hampered revenue rebounds, Moody’s Investors Services said on Dec. 17 when it changed its outlook on the state’s debt to negative from stable.
Moody’s has an Aa3 rating on New Jersey’s general obligations, the fourth-highest level. Only Illinois and California have lower Moody’s ratings among U.S. states.
New Jersey lawmakers were right in saying that Christie’s targets were too rosy, said Assembly Speaker Vincent Prieto, a Democrat from Secaucus, after receiving Rosen’s memo. Democrats control both houses of the legislature.
“He should have been more cautious, as the legislature suggested,” Prieto said of the governor in a telephone interview. “It shows we were correct and going forward should be very careful.”
Assemblyman Declan O’Scanlon, the ranking Republican on that chamber’s budget panel, said the shortfall doesn’t immediately signal a need for Christie or Treasurer Andrew Sidamon-Eristoff to make mid-year cuts to the $33 billion spending plan he signed in June.
“We have growth -- we just don’t have enough and it’s not the growth you’d expect to see nationally,” said O’Scanlon, who was vacationing in Vermont and said he hadn’t seen the memo.