John Reitmeyer | April 6, 2020 | NJ Spotlight |
On top of a health crisis, many states are also facing serious budget challenges as revenues plunge during the ongoing novel coronavirus pandemic. But New Jersey appears to be the only one in the country that is proposing to extend its fiscal year to serve as a relief valve.
That almost unprecedented step was announced jointly last week by Gov. Phil Murphy and legislative leaders, and now the hard work has begun to sort out exactly how to go about adding three more months to the state’s budget year, which typically lasts from July 1 to June 30.
A draft of the extension legislation is not ready yet, and may not be for several days, even though the bill is also intended to serve the dual purpose of officially delaying New Jersey’s state income-tax filing deadline from April 15 to July 15. That’s another major move that was announced by Murphy and lawmakers last week in response to the ongoing pandemic.
Wall Street analysts signaled New Jersey’s next moves will be closely watched by their credit-rating agencies, with one calling a move to change the state fiscal year “unusual.”
The move to extend the state fiscal year to Sept. 30 is intended to provide invaluable time for state budget officials to assess the damage the pandemic is causing to the New Jersey economy. It should also help policymakers set the best course for the state going forward. But it won’t wipe away some of the significant fiscal challenges that New Jersey was already facing even before the onset of the pandemic, including managing the state’s grossly underfunded public-worker pension system.
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