New Jersey Assembly Approves $5 Billion Emergency Bond Plan
By Joseph De Avila
The New Jersey Assembly passed a measure sought by Gov. Phil
Murphy giving the state the authority to seek $5 billion in bonds
as officials struggle to close a massive revenue shortfall stemming
from the Covid-19 pandemic.
New Jersey's Department of the Treasury projects the state's tax
revenue to fall short of previous estimates by $10 billion through
June 2021. That decline is the result of state restrictions on
business activity to help curb the spread of the coronavirus, which
has led to widespread unemployment and declines in corporate and
income tax revenue.
"This scope of this budget crisis cannot be understated and
requires us to consider any possible solution," said Assemblywoman
Eliana Pintor Marin, who sponsored the bill.
The measure would also give Mr. Murphy, a Democrat, the
authority to seek additional loans from the federal government.
The Assembly approved the bill Thursday by a margin of 51 to 28.
The bill still needs to be approved by the Democratic-controlled
state Senate. A spokesman for Democratic Senate President Steve
Sweeney declined to comment.
New Jersey Assembly Republican Leader Jon Bramnick opposed the
measure, saying it would produce higher taxes for state
"Very serious decisions have to be made. But we shouldn't have
our judgment clouded in the middle of a crisis," Mr. Bramnick said.
"We also need to debate every potential new piece of legislation,
every possible reform and every possible way we can reduce the cost
of government. We haven't done that."
The Murphy administration has also proposed $5 billion in cuts
to state spending to help close the revenue gap. New Jersey
received $2.4 billion from the federal Coronavirus Relief Fund, but
state officials said that won't be enough to fix New Jersey's
The emergency bonding plan would help the state get by in case
Congress doesn't approve more federal funding for New Jersey, Mr.
Murphy said at a press conference Thursday,
"That is the immediate relief that we need desperately," the
In New York City, Mayor Bill de Blasio also sought the authority
to borrow up to $7 billion to help the city cover costs related to
the pandemic, but the state legislature rebuffed him in May. New
York lawmakers say they will convene next week to consider bills on
criminal-justice matters but haven't said whether they would take
up the borrowing bill.
New Jersey's Democratic Assembly Speaker Craig Coughlin said
borrowing money wasn't ideal, but the pandemic has created
tremendous financial damage in the state.
"It's an economic tsunami that requires an extraordinary
action," Mr. Coughlin said in a statement.
--Jimmy Vielkind contributed to this article.
Write to Joseph De Avila at email@example.com
(END) Dow Jones Newswires
June 04, 2020 14:36 ET (18:36 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.