Public education, public transportation, and tuition assistance for students are among nearly two dozen public programs that will be funded by the money Governor Phil Murphy and lawmakers will borrow to support the budget. annual.
Members of a panel of four lawmakers plan to meet at State House on Monday to give final approval for $ 4.5 billion in new debt that will be issued without voter approval to help maintain a budget month which received final legislative approval on Thursday.
According to a list provided by the Treasury Department, more than half of the money borrowed will be spent on education programs.
Public colleges and universities and a program that provides state-funded tuition assistance grants to students are also in line to receive borrowed money. Mental health services, substance abuse programs, New Jersey Transit, and state police are some of the other areas that should receive borrowed money, according to the Treasury list.
The New Jersey Constitution generally prohibits the use of borrowed money to finance deficit spending. But it allows exceptions such as responding to war or a major emergency. And while New Jersey is already one of the most indebted states in the countryMurphy and his fellow Democrats who control both houses of the Legislature argued that more borrowing is needed this year to help offset the revenue losses triggered by the ongoing coronavirus pandemic.
Lawmakers approved the budget after a deal between Murphy, Senate Speaker Steve Sweeney (D-Gloucester) and Assembly Speaker Craig Coughlin (D-Middlesex) called for $ 4.5 billion in loans for Help maintain $ 32.7 billion in spending between October 1 and June 30, 2021. Murphy is expected to sign the budget early next week once the loan receives final legislative approval.
More debt than Murphy asked for
The budget deal between Murphy and the legislative leaders added $ 500 million to the amount of debt originally requested by the governor end of August. But Murphy’s budget plan also called for $ 1 billion in tax increases, and not all lawmakers agreed to all of them in the last spending bill they approved on Thursday.
A emergency borrowing law enacted earlier this year allows up to $ 7.2 billion in debt to be issued without voter approval to help fund the budget over the next nine months.
Coughlin and Sweeney have appointed themselves members of the Special Commission on COVID-19 Emergency Borrowing, which was established in the Emergency Borrowing Act. The other members are the Chair of the Assembly Budget Committee, Eliana Pintor Marin (D-Essex) and the Chairman of the Senate Budget and Appropriations Committee, Paul Sarlo (D-Bergen).
The panel is scheduled to meet at 2:30 p.m. Monday at State House in Trenton, according to legislative staff. But there is little suspense for the meeting as the four voted Thursday in favor of the Democratic majority budget, which already has $ 4.5 billion in borrowed money available to spend.
When will it be reimbursed?
Earlier this month, Treasury Department officials said they were planning to issue bonds that would be repaid over 10 years, and they suggested that current market conditions would give a interest rate around 2%. A report submitted to lawmakers in recent days indicated that the interest rate cannot exceed 6% and that the bonds can be repaid over a 12-year term.
The following is the complete list of Treasury programs and services that would be funded with borrowed money in fiscal year 2021, broken down by department, program, and dollar amount.
Department of State-Program-Amount in dollars
Children and Families: Child Care System Home Behavioral Health Services – $ 61,934,000
Correctional Services: Freedom of Privacy Act – $ 5,917,000
Education: Equalization assistance – $ 2,331,796,000
Education: increase in non-public safety assistance per student: $ 3,250,000
Education: Subsidies for extracurricular and summer activities for at-risk children – $ 1,000,000
Environmental protection: Drinking water infrastructure – $ 60,000,000
Health: grants to hospitals – graduate medical education – $ 163,350,000
Health: Health Care Subsidy Fund Payments – $ 51,715,000
Health: Maternal, Child and Chronic Health Services – $ 34,359,000
Higher education: operating aid for higher public colleges and allocation based on results – $ 394,973,000
Higher education: tuition assistance grants – $ 334,887,000
Social Services: Medicaid Day Care – $ 45,000,000
Social services: DDD Individual supports and community programs – $ 314,408,000
Social Services: MHAS Community Care and Mental Health Case Management Services – $ 241,242,000
Human Services: DFD Substance Use Disorders Initiatives – $ 15,012,000
Social Services: DFD Work First Assistance Services in New Jersey – $ 11,534,000
Human Services: DFD Work First Work Activities in New Jersey – $ 8,350,000
Social Services: DFD Code Blue – $ 2,500,000
Social services: DFD SSI attorney fees – $ 1,367,000
Law and Public Safety: State Police Non-Salary Operating Expenses – $ 31,260,000
NJ Transit: NJ Transit Grant – $ 386,146,000
GRAND TOTAL: $ 4,500,000,000
Source – New Jersey Department of the Treasury
