Overall, the state has collected $210 million, or 3.4 percent, less revenue than it expected in the first four months
State Treasurer Andrew Sidamon-Eristoff looks at a chart during a press conference at the Statehouse in this January 2011 photo.TRENTON — New Jersey’s revenue collections continue to fall short of projections, but whether the decline is related to severe weather or a stormy economy – or combination of both – is still uncertain. But no matter the cause, the steady declines have raised the possibility that the state might have to consider painful mid-year cuts to pay its bills.
“I am not ruling that out, but it’s too early to say.” said Assemblyman Declan O’Scanlon (R-Monmouth), the ranking Republican on the Assembly Budget Committee. “We just have to keep an eye on the numbers, and see if the economy and Wall Street bounces back, but we’ll be ready to act.”
October revenue collections fell 3 percent short of projections, the third consecutive month the state has missed its target, according to figures released yesterday. Overall, the state has $210 million less revenue than it expected to collect in the first four months of the budget year, figures show.
State Treasurer Andrew Sidamon-Eristoff believes the dip is due in large part to the severe weather that has rocked the state in recent months, but he has not ruled out other factors.
“The last two months of revenue collections have been impacted significantly by multiple disruptions resulting from uncommonly severe weather,” Sidamon-Eristoff said. “Still, we can’t be 100 percent certain of the real impact on revenue until we have figures on collections from a month when weather was not a factor.”
Assemblyman Lou Greenwald (D-Camden) quickly attacked the Treasurer’s weather explanation, saying it’s the equivalent of a student telling a teacher a dog ate their homework.
“If the best they can do is blame the weather, then it’s no wonder hard-working men and women in New Jersey continue to struggle to make ends meet,” said Greenwald. “The reality is that, unfortunately, figures like these are to be expected until the governor joins Democrats in focusing on job creation and economic growth.”
With a stubbornly-high unemployment rate, New Jersey’s economic recovery has lagged behind the nation’s.
In a report issued earlier this month, Moody’s said the slow national economic growth and federal spending cuts have dampened some states revenue projections, citing New Jersey, California and Florida as examples.
"Persistent state fiscal pressures, aggravated by additional federal spending reductions or further weak economic or employment performance may force mid-year budget cuts," the ratings agency noted.
New Jersey enacted a $29.7 billion budget in June that kept spending virtually flat, but projected a surge of more than $1 billion in revenue collections to make up for the loss of federal stimulus dollars.
Revenues are down across the board, from sales tax and income taxes to motor vehicles and casino fees, records show. However, the state is still outpacing its revenue projections from a year ago.
Relying on higher revenue estimates and a millionaire’s tax, Democratic lawmakers wanted to increase spending this year, but their plan was vetoed by Gov. Chris Christie. “I think the numbers, at least for now, show that conservative budgeting works and that there is a new, sober attitude in Trenton,” said O’Scanlon.
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