Governor Murphy Presents His Fiscal Year 2023 Budget

Governor Murphy presented his Fiscal Year (FY) 2023 Budget to a joint session of the State Legislature in a live address for the first time since February 2020.

The proposed budget totals $48.9 billion – a $2.5 billion increase over the FY 2022 budget – and includes a $4.2 billion surplus, which is nearly double the surplus included in last year’s budget. The proposal does not include any new taxes or fees. In fact, the Governor’s spending plan includes a one-year fee holiday to waive fees typically assessed for driver’s license renewals, marriage licenses, state park entry, and license fee applications or renewals for roughly 130,000 professionals across the health care spectrum.

The Governor themed his budget address around one word: Affordability. This became a key issue in the 2021 gubernatorial and legislative election, and is something both the Governor and legislative leaders identified as their priority for the current legislative session.

The budget proposal looks to improve affordability in the State by addressing property taxes and access to housing. It appropriates $900 million for the Affordable New Jersey Communities for Homeowners and Renters (ANCHOR) Property Tax Relief Program, which proposes to provide property tax rebates to both homeowners and tenants. Additionally, the Governor’s budget allocates $300 million to the Affordable Housing Protection Fund to assist with constructing over 3,000 affordable housing units that have already been approved but remain unbuilt.

Education remains a top driver of state expenses, and the Governor’s proposal calls for a series of investments in Pre-K through 12 education, as well as higher education. Nearly 25 percent of the budget’s expenditures stem from state aid for K-12 public education ($9.9 billion), school construction and renovation ($430 million), an expanding pre-school access ($70 million).

For the second year in a row, Governor Murphy’s proposed budget also includes a full payment toward the State’s public-employee pension obligation totaling $6.82 billion.

The budget address did not detail how the State will use the remaining federal aid it received from the American Rescue Plan Act of 2021 (ARPA), which will total over $3 billion. Instead, the Governor’s Budget in Brief highlights sectors where funds have already been provided, and calls out areas of “possible” investment. These areas include student mental health support, community-based violence intervention, economic growth and community development initiatives, clean drinking water access, and flood resistant communities.

The text of the Governor’s budget address may be found here and the Budget in Brief may be found here. As the budget process continues, the Legislature will hold public hearings followed by presentations from each Executive Departments to the Senate and Assembly Budget Committees. The Legislature must enact a budget by June 30, 2022 when New Jersey’s fiscal year ends.

You may also like...