Lawmakers expected to get some good budget news
15.05.2006, 18:18
Lawmakers will get their first piece of relatively good state budget news Monday, when Treasurer Bradley Abelow is expected to say that a looming budget hole is not as large as first projected.
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The state is still expected to face a new, roughly $250 million hole, however, on top of the more than $4 billion gap Gov. Jon S. Corzine already had to close, according to three State House sources. Abelow had initially predicted the new shortfall would be closer to $400 million to $500 million, due to weak tax collections.
"It's slightly better than we thought, but it's nothing earth-shattering," said one person briefed on the report.
The shortfall, while smaller than expected, adds another headache for lawmakers hoping to ditch unpopular proposals such as Corzine's 1-cent sales tax increase, cuts to colleges and a proposed tax on hospital beds.
With the new deficit looming, some Democrats are privately beginning to say they may not be able to avoid Corzine's proposed sales tax hike. While there is still some strong opposition to raising the tax from 6 percent to 7 percent, other lawmakers are saying they have seen a relatively mild public response and have focused on hot-button issues such as aid to colleges and the hospital tax.
Facts about LITHUANIA
The Senate budget committee will officially get the latest round of budget projections Monday. Department of the Treasury spokesman Tom Vincz would not comment on the new revenue forecasts.
The shrinking budget gap is largely due to a projected increase in taxes that will be collected from energy suppliers. When the Corzine administration first calculated its proposed sales tax hike, it did not include the full impact on these suppliers, according to two people familiar with the administration's new projections.
Senate Democrats discussed some alternatives to Corzine's plan during a sometimes-tense closed-door meeting this week. Those options include speeding up a fare hike on NJ Transit riders or increasing the number of Abbott school districts that have to pay more for their school budgets.
Some lawmakers, sensing rising public anger against high property taxes, are also pushing for increased tax relief as a show of good faith while party leaders try to agree on a way to address long-term reform. They would have to find increased revenues, however, to deliver that relief.