Senate Panel Advances Smart, Responsible Budget That Reflects Economic Conditions

Sarlo: ‘This budget plans for a tax cut, but it doesn’t commit to one.’

Trenton – Senator Paul Sarlo, chairman of the Senate Budget and Appropriations Committee, issued the following statement on Thursday after the committee approved the state budget for Fiscal Year 2013:

“This is a smart, responsible budget that reflects economic conditions. It doesn’t achieve all that we would want, but it accomplishes what we can afford. It meets the state’s most important needs and it advances Democratic priorities without putting the state at risk of an economic crisis during the year ahead.

“This budget plans for a tax cut, but it doesn’t commit to one. We have set aside funds in the surplus to pay for the first year of the Democratic plan to provide property tax relief for the middle class, but are withholding implementation. The smart thing to do, the responsible thing to do is to plan for a tax cut but wait until we know it can be paid for. By acting with responsible patience, nothing will be lost to the taxpayers. The plan wouldn’t take effect until next January, affording us six months to measure economic performance and state revenues.

“We already convinced the governor to abandon his plan to cut income taxes for the wealthy and agree to the Democratic plan to provide property tax relief for the middle class. He should also accept the wisdom of being responsibly patient with its implementation.

“Our budget spends $62 million less than the governor’s proposal and sets aside $183 million more in the surplus. While our resources are limited, this plan addresses a few key needs. It restores the cut to the Earned Income Tax Credit made by the governor with $50 million. By returning the EITC from a 20 percent credit to 25 percent we are providing a tax cut for those who need it most, the working poor. The budget also includes an additional $25 million for nursing homes. We have a moral responsibility to support the care provided to seniors and the disabled.

“I do possess a serious concern about the budget. It is based on the governor’s revenue predictions of a 7.2 percent increase, one of the highest in the country and almost twice as high as most other states. The governor’s projections appear to be designed to advance a political storyline for his national Republican profile, but it ignores the economic truths that show New Jersey’s economy is performing far worse than other states under Governor Christie. If his revenue projections resemble his so-called ‘Jersey comeback,’ they’ll turn out to be a political mirage that leaves the middle class empty handed.

“But the governor is the only one with the constitutional authority to certify revenues. He’s the one who decides what revenue estimates are used in the budget. But we can keep a check on him by delaying implementation of the tax cut.

“This is a budget that represents the unified priorities of Democrats, that addresses the important needs of the people of New Jersey and that reflects the difficult economic conditions that confront us all. And it is a budget that is consistent with the Governor’s priorities. This is a budget that will maintain confidence in the state’s fiscal condition and will prepare for future opportunities.”