Governor Murphy Delivers FY2022 Budget Address
February 23, 2021
My fellow New Jerseyans.

Six weeks ago, I stood in this empty theater to lay out my vision for the year ahead and for the New Jersey we believe – and know – we can build, on the other side of the pandemic.

Much has changed in the six weeks since the State of the State Address.
We worked hard to crush the curve again, and today the second wave of the pandemic, which was just hitting its peak six weeks ago, is subsiding.

The numbers of patients in our hospitals, and of those requiring intensive care and ventilators, are all down. Almost every day, more patients leave our hospitals than are admitted.

The spread of the virus is decreasing. The number of new cases identified is down.

These declines are occurring as we consistently grow and improve vaccine access and delivery.

We are rapidly closing in on two million doses having been put into the arms of New Jerseyans. Among them, health care workers and first responders, our seniors and most-vulnerable residents, and thousands of eligible front-line and essential workers, and everyday New Jerseyans, who are at a higher risk for serious COVID complications.

And, today, we are hopeful that the latest vaccine, from Johnson & Johnson – one of New Jersey’s most iconic names – will soon receive its Emergency Use Authorization from the federal government and become our third potent weapon against COVID.

Because of these positive advances against the pandemic, we’ve been able to responsibly roll back more of the restrictions we had to put in place.

Today, for example, our restaurants can serve more patrons, and our houses of worship can welcome more congregants.

Today, the overwhelming majority of our schools are open for in-person instruction, and more parents can once again cheer on our high school athletes.

Yet, for all that has changed for the better, some things remain the same.

For starters, I’m standing once again in this same empty theater.

Vaccine demand still far outnumbers supply. We know many people still find it challenging to get an appointment. We work hard every single day to improve and make our system better.

Even though we make strides every day, we know this pandemic is not done with us, and the emergence of new variants means we must remain vigilant.

But even as we continue to confront the pandemic’s challenges, we cannot – and we will not – allow our state to sit still. We won’t allow New Jersey to be pulled backward. This is the time to look ahead.

This is the time for us to lean into the policies that can fix our decades-old – or in some cases centuries-old – inequities. It is the time for us to also lean into the economic policies that will not just get us through the remaining months of the pandemic, but which will supercharge our reemergence from it and the recovery that awaits on the other side.

Most of all, this is the time to move New Jersey forward. And that is what this budget does.

This is the vision I put forward in the State of the State address six weeks ago, and it’s this vision that remains wholly intact today.

This budget lives up to our stronger and fairer mission. Stronger to come out of the pandemic with an economy that works for every New Jersey family. Fairer to help families and small businesses hit hard and left behind in the pandemic’s brutal wake.

This budget will continue to stabilize property taxes for hardworking families.

This budget will continue the hard work of moving forward – not only from the pandemic – but from years of neglect.

Our problems weren’t created overnight and, frankly, they won’t be fixed overnight. But I know that brighter days lay ahead.

This budget is built to meet the needs of our residents for more affordable and accessible health care…

…of our kids for a world-class education from pre-K all the way through to a solid career…

…and of our communities to have more inclusive and affordable housing options.

This budget is built to spark New Jersey’s recovery…

…by creating more good-paying jobs and getting our economy moving again…

…by supporting the small businesses that were hit hardest and investing in companies that can create the jobs of tomorrow – especially in the clean energy industry that will literally power our future…

… by building world-class roads and rail-service networks – the biggest investments in infrastructure in New Jersey’s history…

.. and by modernizing state government itself.

Now, to be sure, this future isn’t something we just drew up.

We’ve been working for the past three years to build its foundation. Certainly when our administration took office in 2018, no one had any clue of what 2020 had in store for our state, our nation, and our world. But the decisions we’ve made have proven right not just for those times, but for the times we are facing now.

As Robert F. Kennedy said: “The future is not a gift. It is an achievement.” This quote rings so true for our state and this moment.

And, I would humbly add, the future is an achievement built through hard work, with a determination to make the tough decisions – not just the easy ones – and, most of all, staying true to a vision and a clear and unwavering set of priorities.

We’ve worked in partnership with our colleagues in the Legislature, led by Senate President Steve Sweeney and Assembly Speaker Craig Coughlin. And the reforms and advances we have made together over the past three years are all paying off…

…a stronger and higher minimum wage…

…opening access for more residents to quality and affordable health care…

…real second chances for those formerly incarcerated…

…broader protections for workers and our immigrant communities…

…and reforming the incentives available to businesses who call New Jersey home, among other vital steps taken together.

Yet, underpinning these successes are the fiscal decisions we have made over the previous three years, which have similarly strengthened our economic foundation.

We instituted the budget practices and policies we did because, after years of neglect, our fiscal house needed to be restored. Those decisions are even more important and impactful now.

We made the first payments into our Rainy Day Fund in over a decade. It could have been very easy to just spend this money, but saving it has proven helpful to ensuring that our state weathers the pandemic.

We have been consistent in how we’ve built our budgets. We removed the blinders and rose-colored glasses worn by previous administrations to deliver budgets that were honest and straightforward, built on real and attainable revenue figures, and with record-setting surpluses.

We have been clear in how, and where, and why, we would invest. Our budgets have not been one-year bandaids to get us from election to election, but long-term plans focused on our future success.

We have focused on responsible decisions – not gimmicks, or smoke and mirrors.

Look, we’ve been honest and transparent every step of the way. We’ve never pulled a bait-and-switch on the people of New Jersey or on the programs they rely upon. We made the hard choices to prepare for the unknown challenges, never imagining a once-in-a-century pandemic would set before us challenges never before seen. But the decisions we made have us ready to not only build back – but to leap forward.

We have sought long-term savings wherever we could. We negotiated in good faith with our public union partners and educators on health care plans that are delivering high-quality care for the workforce all of us rely upon, while, at the same time, cutting costs for taxpayer

We have taken a critical look at the operations of government itself to ensure that we are doing things as efficiently and effectively as possible.

We’re investing in modernizing critical operations and technologies in the Motor Vehicle Commission and in our unemployment systems in the Department of Labor – two areas, in particular, where the pandemic exposed shortcomings. Too many people across New Jersey paid the price for that long standing neglect.

So, this is my simple, clear message: New Jersey is done kicking problems down the road. We are solving them.

And we have looked to streamline other processes, as well. This budget will, for example, do away with antiquated permitting rules at the Department of Environmental Protection, and other departments, which will cut government bureaucracy and get projects off the ground quicker.

We are focused on ensuring that our state government works the way it should, and under this budget, the needs of New Jersey will be met by a government that is more efficient and smaller than it was when we took office.

We got to work restoring NJ TRANSIT to make it function better for commuters and to make it a point of pride for attracting, growing, and keeping new jobs and industries. And we put shovels in the ground to modernize the drinking water infrastructure we will need to make our communities safer, especially for our kids. Because of sizeable support from the federal government, these investments are all protected and maintained.

And, I can stand here today and tell NJ TRANSIT’s riders that, for the fourth year in a row, you will not see a fare hike. Under prior administrations, fares went up while service went down. Well, this administration is improving service and not putting the burden on the hundreds of thousands of New Jerseyans who will come back to a much improved NJ TRANSIT.

We never gave up on ensuring that our middle class, and those striving to join its ranks, achieved a greater degree of tax fairness.

We expanded the Earned Income Tax Credit – both in terms of the amount and the number of families receiving it.

And we restored the millionaire’s tax to ensure that our wealthiest pay their fair share. Because of this, not only have we secured the resources to invest even more deeply in our communities, we’re able, in this budget, to provide checks totaling nearly $320 million in direct tax rebates to hundreds of thousands of working and middle-class New Jersey families.

The success of the millionaires tax is simple proof that New Jersey works better for everyone when everyone does their part.

We have also done more to ensure that all residents have access to high-quality and affordable health care.

The very first law I signed as Governor restored state funding for women’s health and family planning, reversing eight years in which access withered under budgets which put a total of zero dollars for these important programs. And, under this budget, we will not only renew, but expand, our commitment to women’s health.

With support from our legislative colleagues, we also took control of our health insurance marketplace to protect our residents from the previous presidential administration’s constant attacks on the Affordable Care Act by opening Get Covered New Jersey, our own state-run marketplace.

During open enrollment, from November 1st through January 31st, nearly 270,000 New Jerseyans purchased a health plan through our new marketplace – nearly 10 percent more than had done so in 2019, when the federal government still ran things for us.

Moreover, more than 75,000 health care policies were purchased by consumers buying through the marketplace for the first time.

Not only did we make health care more accessible than ever by opening our own state-run health care marketplace, we made health insurance more affordable than ever before. Thousands of New Jerseyans who have qualified for financial assistance are paying monthly premiums lower than when the Affordable Care Act first came online in 2014.

For families and individuals who still need health insurance, I have announced a special enrollment period through May 15th in response to the pandemic. Go to getcovered.nj.gov today to shop for a health-care plan and enroll – no questions asked.

And to ensure that consumers continue to find good values on our exchange, our proposed budget would provide even more direct financial assistance – and, therefore, lower monthly premiums – to many consumers.

Making health care more accessible and more affordable is a smart thing to do in good times. It is even more critical now given the times we’re currently in.

This is what change looks like. This is change that works/

This budget is prepared to support New Jerseyans through every stage of life.

We are investing directly in the First Lady’s strategic efforts to combat our maternal and infant health crisis and the racial disparities that drive it. And because new mothers need support well past delivery, we will become one of the first states to ensure Medicaid coverage for one full year after delivering a baby. Working together with thousands across our state, we will make New Jersey the safest place in the nation to deliver and raise a child.

And, by more strategically using our federal Medicaid funds, we are proposing a new Cover All Kids initiative – a $20 million first-time investment in ensuring that every child in New Jersey has health care. This will bring enormous peace of mind to working parents across the state.

We are also standing up for at-risk youth with a long-overdue increase in state reimbursement rates for providers through the Children’s System of Care program, which serves approximately 60,000 young people with emotional, behavioral, or developmental challenges.

These rates have not budged in years. Over that time many of the professionals we need to help reach these vulnerable youth have simply walked away. It’s time we bring them back. A deeper pool of professionals ready to serve means fewer kids left to navigate life’s challenges on their own.

We also propose increasing funding for residential providers for individuals with intellectual and developmental disabilities so they can better address the health care needs among some of our most-vulnerable residents.

In one of the most important elements under this budget, more seniors would be able to benefit from an expansion of the popular – and more necessary than ever before – Pharmaceutical Assistance for the Aged and Disabled – or, PAAD – program to make prescription drugs more affordable.

And, we are continuing and committed to our fact-based approach to tackling our opioid epidemic, and we will maintain this fight in our budget.

For every resident, of every generation, no other American state can boast of being able to do what New Jersey will to protect and advance a healthy society.

And, because of our focus on budgeting the right way, and focusing on people and not politics, the budget I am presenting today can make these investments and achieve these goals for the year to come with no increases in taxes.

Yet we’ll be able to maintain and grow our investments in the key areas that will power our state’s emergence from the pandemic and drive us confidently into the future.

The investments we’ve made in our public schools, and other policies we’ve pursued to help communities smartly grow and redevelop, have been made because we know that finally tackling the issue of property taxes requires a keen focus on the core drivers of property taxes.

Because of this focus on delivering real and lasting property tax relief, our administration’s first three years have seen the slowest rate of property tax increase of any administration since the start of the millennium. Since we’ve taken office, the budgets we’ve presented have contributed to three of the lowest year-over-year increases in property taxes on record.

This year, we aim to keep this progress going.

To begin with, we have no intention of breaking our streak of fiscal responsibility, and of honestly meeting our state’s long-term obligations. And there is no greater example of this than our commitment to increasing our payment into our public employee pension funds.

Let’s make one thing absolutely clear. The problems and shortfalls in our pension system have absolutely nothing to do with our hardworking public employees who have dutifully paid their full share into the pension funds every two weeks. They’ve been scapegoated for far too long.

The problems in our pension system, rather, have everything to do with past administrations, of both parties, and going back 25 years, who simply and short-sightedly decided not to pay. In fact, some suggest, even today, that we skip out on our pension obligation. We won’t go back to those failed, old ways.

That’s why, in this budget, we will achieve full funding of our annual obligation for the first time since 1996 — a total payment of nearly $6.4 billion. And we will achieve this goal a year earlier than planned.

Making this additional $1.6 billion pension payment isn’t some abstract concept.

Making the payment is keeping our word to hundreds of thousands of retirees who depend on their pensions. It means keeping our word to families all over our state who were made promises by governors who then turned their back on them.

We did it without attacking the middle class and slashing services, the way we always knew was possible, but were always told was impossible.

And it means keeping our word to all taxpayers that this administration would deal with our longstanding fiscal issues honestly and transparently. Making the full payment, and getting our pension system back to safe ground protects your long-term interests, as well.

We’re now on the road to fixing one of the biggest financial problems of any state in America. And when we keep making this payment, we’ll go from a pension system that many said was destined for bankruptcy, to one that is solvent, healthy, and sustainable.

In New Jersey, keeping your word means something – and I am keeping my word.

But properly funding our pensions isn’t the only obligation we have worked hard to meet.

The budget I am proposing would increase our investment in our public schools by $700 million. With this investment, our administration will have increased investment in our preK-through-12 classrooms by more than $1.5 billion across our four budgets.

And, through this investment, our administration will have come closer to meeting our obligations to our students, educators, and communities through fully funding our school funding formula. This is something that hasn’t happened in well over a decade.

Make no mistake, this is not just vital funding for our educational communities – so they can invest in the tools our students and educators need for a 21st-century education – it is just as vital for our property taxpayers.

Every dollar in new state funding is a dollar that doesn’t have to be placed on the shoulders of local property taxpayers, plain and simple. And, over four years, along with our partners in the Legislature, we will have lightened that burden by more than $1.5 billion.

This funding increase also acknowledges the fact that some students have fallen behind due to the burden of remote learning. This increased investment will help stem the learning loss we know has happened, and it will help bring our students back up to par.

This also includes expanding our investment in pre-K for our youngest learners by another $50 million, including more than $25 million so more districts can offer free pre-K programs for the families they serve.

Pre-K is one of the smartest investments we can make in our future. We already know that students whose journeys begin in pre-K see the investment we make in them returned more than seven-fold throughout their lives. For working and middle-class families, access to high-quality, free pre-K programs saves them money, time, and worry.

Getting to a full pension payment and more than $1.5 billion in new educational funding are two things we were told we’d never be able to achieve in eight years, let alone four. Yet, here we are.

Other administrations kicked the can down the road. We’re done kicking. Today, we’re finally picking it up.

But, we are not done yet, because we know we also have to help the families knocked down by the pandemic pick themselves up.

For those families who don’t have access to pre-K, or need someone to look after their kids before they get off work, we propose opening access to the successful child and dependent care tax credit to families with incomes up to $150,000. Right now, that limit is $60,000.

And for many families – and most especially for New Jersey women – this expansion will make your tax credit bigger to allow you to recoup more of the costs of child care.

With school and work both becoming overwhelmingly remote over the past year, it has been New Jersey’s women who have increasingly shouldered an unequal burden. They haven’t had to just be fully present at work, but also as chief caregiver, among numerous and immeasurable other demands.

This tax credit is about helping to level the playing field for working families – but its impact is even bigger for working women.

This tax credit program didn’t even exist three years ago. Lieutenant Governor Sheila Oliver and I fought hard to see it created. And, we’ll continue to work to ensure it keeps providing the help we promised.

And our commitment is also found in our efforts to close the digital divide in our schools – the hard work to ensure that every student, in every community, has the right technology and internet access. Closing this divide isn’t just critical in this time of remote learning, it’s critical to the bigger goal of ensuring a 21st century education for every child.

When we began last summer, an estimated 231,000 students across our state had fallen into the digital divide. We put $60 million to work to close this gap – and today, what was once 231,000 students is now roughly just 125.

We’re going to get this divide to zero, and when we do, every student will have the tools they need for a bright future. This isn’t just fixing a longstanding problem few thought could be solved. This is preparing for a brighter future where everyone can participate.

Making child care more accessible and affordable, and closing the digital divide all underscore how we’ve taken on every issue we inherited and uncovered. We didn’t talk down our problems or scapegoat others for their existence.

We’ve simply rolled up our sleeves, designed practical solutions, and gotten to work.

We’ve taken this same approach across the board. We have focused on the long-term because we’re not interested in taking only first steps. We’re planning out the entire journey.

For example, if access to quality pre-K programming starts an individual down a path to a good career, and strong public schools and the right tools prepare them for adulthood, then we must ensure greater access to a higher education that can be both a capstone educational achievement and a stepping stone to even greater success.

Three years ago, we instituted the Community College Opportunity Grant program, which is allowing thousands of qualified students – whether they be young people planning their futures or older residents returning to school for new opportunities – to earn an associate’s degree tuition-free. And this week, together with my legislative partners, I will sign a bill permanently protecting this program in state law.

This year, we’ll take the next step. Our budget looks to make a new promise to our residents, through the Garden State Guarantee, to provide the first-two years of study at one of our four-year public colleges and universities tuition-free to thousands of eligible students.
Yet we know that not every job in our state’s future will require an advanced degree – especially those in our rapidly expanding clean energy economy. So we will maintain our strong investments in job training and apprenticeship programs.

These investments are all critical to ensuring that the New Jersey which emerges from the pandemic provides even more opportunities for success than the New Jersey pre-pandemic.

Creating these opportunities will be an economy fueled by innovation and powered by small business.

Last month, I signed into law a new era in how New Jersey provides economic incentives to companies that want to call the Garden State home. Instead of a system tilted in favor of just the biggest and wealthiest companies, we now have a program purpose-built to support homegrown small businesses.

Through this budget, we’re ready to deploy almost $200 million over the next two years in direct grants, loans, loan guarantees, and other tools for countless Main Street small businesses.

This is all on top of the hundreds of millions of dollars we’ve invested directly in our small businesses already through emergency grants and loans – funds that have allowed many to keep their doors open through uncertain times.

And, we recently gave our business sector another boost when we announced that all the federal support our businesses received through the Paycheck Protection Program would be exempt from state taxes. For the average New Jersey business, this will be a tax savings of nearly $10,000. And, moreover, since we also made the expenses those funds went to cover tax deductible, our small businesses will pay even less in taxes.

We’re also poised to support the next generation of leading-edge technology startup businesses through the Innovation Evergreen Fund, a groundbreaking new public-private investment partnership.

And every new small business will be supported and connected by stronger and more reliable transportation and energy infrastructure.

Safer roads and bridges. Improved mass transit. Clean energy, including the South Jersey Wind Port that will make our state a hub of manufacturing and logistics. Modern schools, with a $75 million commitment to upgrade the places where our children learn. All of this is in this budget.

But success isn’t just measured by a good education or a good job. It’s also measured by being able to find a home to call your own. Renters and homeowners have been hit hard over the past year, and even with the protections we have put in place – including a moratorium on evictions and public-utility shutoffs, and direct rental assistance and mortgage forbearance – we know we need to do more.

We are maintaining our commitment to ensuring that the Affordable Housing Trust Fund goes to the cause of providing families an affordable home, whether they rent or own. And we are increasing our investment in mortgage down payment assistance for qualified first-time home buyers.

Our communities are made stronger when everyone who contributes to its success has the opportunity to live there…

…the server waiting on you at your favorite neighborhood restaurant…

…the young teacher, just starting out in your child’s classroom…

…the rookie cop, working hard to rebuild trust in law enforcement with the community he or she serves…

…the grocery clerk stocking the store shelves and the cashier ringing up your purchase…

…the young family with big dreams and a modest income who want nothing more than a strong community in which to raise their new child.

Housing policy needn’t be about dividing communities. Our state just works better when everyone has an equal chance to be a part of our future and no one is shut out.

That’s a lesson we know Washington can learn, and as President Biden and the Congress continue to work on another much-needed federal coronavirus relief package, we will be watching and advocating for the needs of the people of New Jersey.

We know our working and middle-class families need the additional direct economic benefit that $2,000 can bring. And, as a state, we need direct state and local aid to ensure that the key programs and essential workers we all rely upon remain funded and employed.

And, should this package make it through and be signed by the President, it will allow us many more degrees of freedom in making sure this budget meets its promises.

The only way we’ve gotten through the past eleven months is by sticking together and tending to the little things that have made a big difference. Now is not the time to stop.

This is a budget for New Jersey’s middle class, New Jersey’s dreamers and innovators, and New Jersey’s next generation of pioneers.

This is a budget that doesn’t raise taxes on New Jersey’s working families while providing hundreds of millions of dollars in tax relief for seniors, veterans, and parents. This is a budget that continues to turn around NJ TRANSIT, yet doesn’t raise fares.

This is a budget that invests in America’s best public-school system and keeps property taxes from skyrocketing. This is a budget that commits to a clean energy future with good union jobs and increases the minimum wage.

This is a budget that makes health care more affordable and health-care charges more transparent. This is a budget that helps small businesses hit hard by the pandemic and creates opportunities for everyone who dreams of opening their own new business.

Most of all, this is a budget purpose-built to fix the inequities that have been allowed to exist for far too long and to spark our economy for the long-term to work for everyone.

This is the budget many thought could never be written. But for the past three years – since the moment I swore my oath as governor – we have worked to secure the full promise of our state for every resident and every family.

New Jersey today is a vastly better place for countless middle-class and working families. We’ve slowed the growth of property taxes more than ever, health care is more accessible and transparent, our schools are better funded, child care is more affordable, and our economy is gaining strength as it continues to be more equitable.

We have taken to heart that truth that the budget isn’t just a long list of numbers, but a statement of values and priorities.

In every line is written our New Jersey values.

The values of hard work…

…of opportunity…

…of faith…

…of inclusion…

… and of always striving and never resting.

And our priorities?

To build a New Jersey that emerges from the pandemic healthier and more resilient, both physically and economically. A stronger and fairer New Jersey not just for today, but for the generations to come.

To change what’s wrong and make sure we get it right for the future.

Meeting every obligation with honesty and transparency, to level with you, and to tell you the truth about our condition, even when the truth may be uncomfortable.

To give every resident the same opportunity for success, whether it be through investing in a world-class education, in extending vital job training, or in ensuring the ability to have a safe place to call home.

This is the New Jersey we set out to create when we took office more than three years ago. And, over each and every one of the past 1,135 days, creating this New Jersey has been our focus and driving passion.

The pandemic has shaken our state – and our world – to the core. It has taken over 22,000 blessed souls away from our New Jersey family. Our hearts may be broken, but we’re not going to cower. That’s never been the New Jersey way.

The New Jersey way is to keep moving forward with a little swagger in our step but even more humility in our hearts.

It’s what made us a leader in this nation since even before its founding. And it’s what is going to make us a leader as our nation builds back from the pandemic.

This is the Garden State. Dreams grow here. Opportunities grow here.

And our future is just taking root.

Thank you. May God bless you and your families. And may God continue to bless the great State of New Jersey and the United States of America.