TRENTON � The Senate Budget and Appropriations Committee today approved a $28.6 billion state budget, which dramatically cuts spending while preserving funding for important health and education programs and provides needed property tax relief for seniors, for the fiscal year that begins July 1.
�This bill represents a tremendous amount of work by a great number of people and embodies the difficult choices we faced in light of the unprecedented economic downturn that is affecting this country and the state of New Jersey,� Sen. Buono said. �It incorporates more than $4 billion of cuts, an unprecedented amount level of cutting that reflects the sharp reduction in revenues the state is experiencing. This budget had been balanced primarily by spending cuts and reductions in baseline growth.
“The budget also represents our state’s commitment to maintaining quality education for our children, increased health care options for all of our citizens and needed property tax relief for our most vulnerable senior citizens. A look at what is happening in other states across the country – massive cuts in education, the closing of prisons, huge tuition increases for college students – shows we can take pride in a budget that has made difficult choices under difficult circumstances.”
The budget bill, (S-2010) was approved 8-7, with no Republicans supporting the bill.
The committee also approved the following related bills, also with no Republican votes:
• S-2011, sponsored by Sen. Buono, supplemental appropriations of $20.8 million for the current fiscal year.
• S-2012, sponsored by Senate President Richard Codey (D-Essex) – increases the tax on cigarettes by 12.5 cents per pack of 20 cigarettes effective July 1, 2009. The bill would increase the tax to $2.70 per pack.
• S-2013, sponsored by Senator Loretta Weinberg (D-Bergen), increases the tax on liquor from $4.40 per gallon to $5.50 per gallon. On wine, vermouth, and sparkling wine, the tax rate would be increased from $.70 per gallon to $0.875 per gallon. The rate on hard cider containing from 3.2 percent to 7 percent alcohol by volume would be increased from $0.12 per gallon to $0.15 per gallon. It does not increase the tax on beer.
• S-2014, sponsored by Senate Majority Leader Stephen Sweeney (D-Gloucester, Cumberland and Salem), would extend a 4 percent surcharge on corporation business tax liabilities that was imposed for three years beginning in 2006. Set to expire this year, the bill would extend the surcharge for one more year.
• S-2015, sponsored by Sen. Buono, increases the tax rate on income earned above $1 million from the current 8.97 percent to 10.75 percent, raising an estimated $200 million. It would increase the tax rate on income earned between $500,000 and $1 million from the current 8.97 percent to 10.25 percent, raising an estimated $620 million. It would increase the tax rate on income earned between $400,000 and $500,000 from the current 6.37 percent to 8 percent, raising an estimated $83 million. It eliminates the property tax deduction for households with income above $150,000, raising an estimated $160 million. And, for the first time, it requires that people who win lottery prizes in excess of $10,000 pay State income tax on the winnings, raising an estimated $8 million.
• S-2016, sponsored by Sen. Sweeney, increases increase taxes on various lines of insurance.
• S-2017, sponsored by Sen. Sweeney, directs the New Jersey Economic Development Authority (NJEDA) to transfer up to $22 million of unencumbered funds derived from interest earnings to the capital investment grant component of the “InvestNJ Business Grant Program.”
• S-2018, sponsored by Sen. Sweeney, would essentially transfer up to $12 million of New Jersey Housing and Mortgage Finance Agency funds to the General Fund, in order to cover the cost of the State Rental Assistance Program.