New Jersey’s FY 2023 Budget Should Strike a Balance Between Responsible Savings, Job Creation and Stimulating the Economy

Statement by Ralph Albert Thomas, CPA (DC), CGMA, CEO and Executive Director, New Jersey Society of Certified Public Accountants

ROSELAND, N.J. — This afternoon, Governor Phil Murphy delivered his budget proposal for New Jersey’s 2023 fiscal year which begins July 1. We applaud the Governor for proposing a budget that includes no tax increases or new fees. The NJCPA also commends Governor Murphy for once again including a full payment to the public worker pension fund, though structural reform to public worker benefits is necessary to end the ballooning burden of these benefits on the state budget. We also applaud the Governor for making a large allocation to debt defeasance.

However, we are disappointed that this budget does little to address the affordability issue facing small businesses. Small businesses were hit hard by the COVID pandemic and yet there is no money in the budget to provide relief for the $1 billion tax increase necessary to replenish the Unemployment Insurance Trust Fund that was drained during the pandemic. While most states have used federal relief funds to eliminate or reduce that burden, New Jersey has not. We urge lawmakers to make UI tax relief a key part of the budget discussions.

Ignoring businesses does not help low- and middle-class New Jerseyans. It hurts them. A thriving economy is necessary to provide jobs and other benefits for New Jerseyans. Everyone benefits when businesses do well.

Also, the state still needs a concrete plan to determine how to use the billions in American Rescue Plan Act (ARPA) funds still left unspent. Part of that plan should be the adoption of legislation (S654) proposed by Senators Oroho and Sarlo that would overhaul the way the state forecasts tax collections by providing a consensus-based model and creating a revenue advisory board. It’s time to overhaul the way the state develops its annual budget, particularly in the wake of the recent $4 billion in emergency borrowing related to the COVID-19 pandemic, and to better appropriate funds in the future. Nearly 30 states already have followed this route and have a similar consensus forecasting model in place.

We are still examining the details of the proposed ANCHOR Property Tax Relief Program, but at first blush it appears to provide much needed property tax relief, though we are concerned that revenues for adequate funding in subsequent years may not be available thus leading to new tax hikes. We’d like to see more done to address the root causes of high property taxes.

NJCPA members serve tens of thousands of businesses and individuals. They are on the front lines of the state’s economy, in the trenches with the people who make the thousands of decisions every day, big and small, that shape New Jersey’s economic climate. Our members are, by and large, practical and realistic. They know that the goal of the budget should be to achieve balance for business and taxes amid competing priorities throughout the state. We need to both save and spend wisely for the overall economic health of the state.

The NJCPA stands ready to be a resource to the Governor and the Legislature.

# # #

The New Jersey Society of Certified Public Accountants (NJCPA), with more than 13,000 members, represents the interests of the accounting profession and advances the financial well-being of the people of New Jersey. The NJCPA plays a leadership role in supporting the profession by providing members with educational resources, access to shared knowledge and a continuing effort to create and expand professional opportunities. Visit njcpa.org.