The New Jersey Senate held its first round of budget hearings Tuesday. (Getty Images)
Business and progressive groups presented Senate lawmakers with divergent views on how to use surging revenues and billions in remaining federal aid at the first of the chamber’s annual budget hearings Tuesday.
Representatives from the New Jersey Business and Industry Association and the Chambers of Commerce of New Jersey and Southern New Jersey praised Gov. Phil Murphy’s planned $6.8 billion pension payment, a proposed $1.3 billion deposit in a fund used to pay down the state’s debt, and the lack of proposed tax hikes.
But they said the $50 million proposed deposit into the Main Street Recovery fund, a pandemic-era small business assistance program, is insufficient. And they urged lawmakers to use federal funds to head off an automatic unemployment insurance tax increase on employers meant to refill the state’s unemployment fund, which was drained by skyrocketing jobless claims during the pandemic.
“There are ways to improve the budget to make our state more affordable through tax relief and a few added pro-growth investments,” said Chris Emigholz, vice president for governmental affairs at the New Jersey Business and Industry Association. “We appreciate holding the line on no new taxes, but we need broad tax relief to better address affordability for all.”
Those arguments, like the ones lodged by progressives, closely echo ones made before the Assembly Budget Committee last week.
Emigholz called on the state to double the $500 taxpayer-funded signing bonuses the state offered to lure people into the workforce and warned the state could be forced to hike taxes once federal aid runs dry and tax collections descend from their surge if spending is not kept in line.
“These aren’t long-term renewable revenue sources they can depend on in the future,” said Hilary Chebra, manager of government affairs for the Chamber of Commerce of Southern New Jersey. “To maintain this level of long-term growth and spend, the state would inevitably have to raise taxes on an already overburdened business and resident community in New Jersey.”
Progressive advocates took a different view, saying that helping the state’s neediest residents would do more to help New Jersey’s economy than aiding businesses.
“We keep hearing about making New Jersey affordable, but we need to ask who we are making the state affordable for,” said Peter Chen, senior policy analyst at New Jersey Policy Perspective, a progressive think tank. “We heard from the business community about how we need to make the state affordable for businesses, but the folks who are getting hurt the most are New Jersey’s low- and moderate-income residents.”
Chen and Renee Koubiadis, who spoke on behalf of the Anti-Poverty Network of New Jersey at Tuesday’s meeting, suggested New Jersey create a state-level child tax credit mirroring the one that exists at the federal level.
They said New Jersey should raise income eligibility and award levels for the state’s earned income tax credit.
The income cutoffs for the federal credit range from $21,430 for a single filer with no dependents to $57,414 for married filers with three dependents. The state award is equal to 40% of the federal credit.
They also urged lawmakers to bolster WorkFirst NJ — the state’s Temporary Assistance for Needy Families — and noted enrollment fell by more than 90% between 1996 and 2018. They warned of a coming eviction crisis if the state does not set aside more money for rental and utility assistance.
“Rather than go toward more corporate tax breaks or giveaways to institutions, these dollars should be going into the pockets of hard-working New Jerseyans whose efforts got us through the pandemic: grocery store employees, home health aides, child care teachers,” Chen said
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