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New Jersey state budget (2009-2010)

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Note: This article was last updated in 2010. Click here for more recent information on state budgets and finances.


FY 2010 Budget

See also: Archived New Jersey state budgets

The state faced a $4.3 billion budget deficit, which was less than the May 2009 estimate of $4.4 billion for FY 2010.[1] Then Gov. Jon Corzine signed the $29 billion FY 2010 budget on June 29, 2009 that was passed by the New Jersey Legislature.[2] New Jersey's total adjusted FY 2009 budget was $33.2 billion with $19.4 billion in General Fund spending.[3]

The FY 2010 budget that began July 1, 2009 had:[4][5]

  • $4 billion in baseline spending cuts, with more than 850 line items being cut, including:
    • $527 million from State Operations
    • $1.5 billion from Grant-In-Aid
    • $1.2 billion from State Aid using $1 billion of federal stabilization funding
  • Increase in education of $300 million

FY 2010 first quarter revenues were down three percent from projections, collecting $5.95 billion instead of the estimated $6.14 billion on which the budget was based. This created a $190 million shortfall. Gov. Corzine ordered department heads to look for $200 million in additional cuts by Dec. 1, 2009.[6]

As the year went on, the state made additional cuts. As of March 2010, $475 million had already been taken out of budgeted state aid to schools for the school year in session. Programs that were set in place in September 2009 were based on this expected state support.[7]

Budget figures

General Fund 2009-10[8]

Category FY2009 Amount in millions Actual FY 2010 Amount in millions Estimated
Beginning Balance 1,304 614
Revenues 29,060 27,338
Adjustments 562 0
Total Resources 30,926 27,952
Expenditures 30,312 27,442
Adjustments 0 10
Ending Balance 614 500
Budget Stabilization Fund 0 0

Fiscal 2010 Tax Collections Compared With Projections Used in Adopting Fiscal 2010 Budgets (Millions)[8]

Category Amount
Sales Tax Original Estimate 8,579
Sales Tax Current Estimate 8,067
Personal Income Tax Original Estimate 10,393
Personal Income Tax Current Estimate 10,393
Corporate Income Tax Estimate 2,440
Corporate Income Tax Estimate 52,270

The following table provides a history of New Jersey's expenditures and gross domestic product (GDP).

Fiscal Year Expenditures (billions) GDP (billions)
2000 $54.5[9] $344.8[9]
2001 $59.4[9] $363.0[9]
2002 $64.2[9] $372.8[9]
2003 $68.4[9] $389.1[9]
2004 $72.6[9] $410.1[9]
2005 $79.8[9] $425.5[9]
2006 $82.9[9] $448.4[9]
2007 $85.6[9] $465.5[9]
2008 $88.5[9] $480.9[9]
2009 $91.5*[9] $480.1*[9]

New Jersey's major state revenue sources are:[10]

  • $11.3 billion Income tax (37 percent)
  • $8 billion Sales Tax (27 percent)
  • $3.8 billion "Other" taxes (12 percent)
  • $2 billion Corporation and Bank Tax (seven percent)
  • $929 million State Lottery (three percent)

Budget Basics

See also: New Jersey state budget and finances

New Jersey's fiscal year begins July 1 and ends June 30 of the following year. The governor reviews individual agency requests along with past and present expenditure and revenue data from November through mid-January. In February the governor makes his or her final decision and presents a budget recommendation to the New Jersey State Legislature on or before the fourth Tuesday in February. The Legislature reviews the recommended budget through a series of hearings and makes any necessary changes to the document. Once both the Assembly and the Senate have approved the bill, it is signed by the governor before July 1. The governor has the power to use line-item veto before signing the bill into law.[11]

Accounting principles

See also: New Jersey government accounting principles

The Office of the New Jersey State Comptroller is an independent office that audits government finances, reviews the performance of government programs and examines government contracts. The office was created by legislation on March 15, 2007. It is responsible for conducting audits of the executive branch of state government, public institutions of higher education, independent state authorities and local governments and boards of education. Appointed by the governor, with the advice and consent of the Senate, the State Comptroller serves a six year term and can be reappointed for a second term. All employees of the Office of State Comptroller are barred from engaging in any political activity. Matthew Boxer was sworn in as New Jersey’s first independent state comptroller on Jan. 17, 2008. The audit reports are published online and can be found here.[12]

Some responsibilities of the comptroller include:

  • Auditing government finances
  • Examining efficiency of government programs
  • Scrutinizing government contracts
  • Providing audit training to government entities

The Institute for Truth in Accounting (IFTA) rates New Jersey “tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR) – the annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and six states as worst. IFTA did not consider New Jersey's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis did not included significant liabilities for the pension plans and for other post employment benefits, such as health care.[13] New Jersey's CAFRs are published online by the New Jersey Department of the Treasury, Office of Management and Budget and can be found here.[14]

The New Jersey State Treasurer was R. David Rousseau, who was confirmed by the State Senate and sworn in as State Treasurer on April 7, 2008. Rousseau was sworn in as Acting State Treasurer on January 16, 2008, soon after Gov. Jon S. Corzine announced his intention to nominate him to be State Treasurer.[15]

Credit Rating Fitch Moody's S&P
New Jersey[16] AA- Aa3 AA

Economic Stimulus Package

New Jersey received approximately $680 million from the federal government under HR 1586, a $26 billion plan to give states money for Medicaid and education that the president signed into law on August 10, 2010.[17]

New Jersey received approximately $1.2 billion from the $787 billion dollar economic stimulus, the American Recovery and Reinvestment Act 2009.[18] All told, the federal stimulus plan created or saved 100,000 jobs in New Jersey, based on White House estimates.[19]

According to preliminary reports, New Jersey expected to receive:

  • $609 Million for Title 1 and IDEA (Individuals with Disabilities Education Act)[20]
  • $6.8 Million towards health care services[21]
  • $894 Million towards transportation projects[22]
  • $73.6 Million for energy efficiency and renewable energy projects[23]
  • $2.6 Million for senior nutrition programs[24]

Budget transparency

See also: Evaluation of New Jersey state website

New Jersey launched Your Money New Jersey, a website that the state called a "Government Transparency Center" on July 1, 2010.[25] The website contains data on tax collections, expenditures by various state agencies and payroll data for agencies and individuals.[25] In November 2010 the state added financial information for 19 independent agencies such as the New Jersey Turnpike Authority and New Jersey Sports and Exposition Authority.[26] A bipartisan bill to make the website permanent and also extend similar online oversight of government spending to the local level was stalled in the legislature.[26]

Government tools

The following table is helpful in evaluating the level of transparency provided by New Jersey Transparency:

Criteria for evaluating spending databases
State Database Searchability Grants Contracts Line Item Expenditures Dept/Agency Budgets Public Employee Salary Exemption Level
New Jersey Transparency
{{{1}}}
 N
600px-Red x.png
 N
600px-Red x.png
 N
600px-Red x.png
{{{1}}}
 N
600px-Red x.png
 N
600px-Red x.png

Economic stimulus transparency

  • New Jersey expected to receive $399 million for Medicaid expenses for the first half of 2011 from the federal stimulus approved by Congress in August 2010. New Jersey had $180 million less than Gov. Chris Christie planned for in this year’s budget. However, the governor did not immediately move to adjust the budget.[27] The state also expected to receive $268 million in education funding.[27]
  • The American Recovery and Reinvestment Plan of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it was estimated that 69 percent, or over $541 billion, would be administered by state governments.[28]
  • New Jersey received an estimated $4,248,900,457.[29]
  • New Jersey established an economic recovery website, Recovery New Jersey, to show how legislators and government officials in New Jersey were spending federal funds.

See also

New Jersey government sector lobbying
New Jersey state budget and finances
New Jersey public pensions

External links

Additional reading

Footnotes

  1. ↑ National Conference of State Legislatures, “State Budget Update: July 2009”
  2. ↑ Gov. Corzine Press Release, "Governor Corzine Signs $29 Billion State Budget That Reflects Ethic of Shared Responsibility," June 29, 2009 (dead link)
  3. ↑ New Jersey Office of Management and Budget, "FY 2010 Summaries of Appropriations," March 31, 2009
  4. ↑ Gov. Corzine Press Release, "Budget in Brief," March 19, 2009
  5. ↑ New Jersey Office of Management and Budget, "FY 2010 Summaries of Appropriations," March 31, 2009
  6. ↑ NJ.com, "N.J. revenue was 3 percent below $6.14B projected budget," October 19, 2009
  7. ↑ Dailyrecord.com, "Budget cuts would raise school taxes," March 15, 2010
  8. ↑ 8.0 8.1 National Governors Association and National Association of State Budget Officers, "Fiscal Survey of States," June 2010 (dead link)
  9. ↑ 9.00 9.01 9.02 9.03 9.04 9.05 9.06 9.07 9.08 9.09 9.10 9.11 9.12 9.13 9.14 9.15 9.16 9.17 9.18 9.19 US Government Spending, "New Jersey State and Local spending," accessed June 3,2009
  10. ↑ New Jersey Office of Management and Budget, "FY 2010 Summaries of Appropriations," March 31, 2009
  11. ↑ State of New Jersey, "The State Budget Process," accessed June 5,2009
  12. ↑ New Jersey State Comptroller Website, accessed November 1, 2009
  13. ↑ Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
  14. ↑ New Jersey Department of the Treasury, Office of Management and Budget Web site, accessed November 1, 2009
  15. ↑ New Jersey State Treasurer Website, accessed November 1, 2009
  16. ↑ State of Indiana, “State Credit Ratings," June 24, 2009
  17. ↑ Federal Fund Information for States, “ARRA FMAP Extension & Education Jobs Fund Totals,” August 11, 2010
  18. ↑ NorthJersey.com, "Lawmakers get breakdown of where NJ stimulus money was going," March 12,2009 (dead link)
  19. ↑ American Recovery and Reinvestment Act, "Impact," accessed June 3, 2009
  20. ↑ Office of the Governor, "Governor Corzine Announces $609 Million in American Recovery and Investment Act Funds for Title I and IDEA," April 16, 2009 (dead link)
  21. ↑ Office of the Governor, "Governor Announces New Jersey Health Centers To Receive $6.8 Million In Federal Funds," March 30, 2009 (dead link)
  22. ↑ Office of the Governor, "Governor Corzine Announces $894 Million In New Jersey Transportation Projects," March 5, 2009 (dead link)
  23. ↑ Office of the Governor, "Governor Corzine Announces $73.6 Million in U.S. Department of Energy Stimulus Funding," May 14, 2009 (dead link)
  24. ↑ Office of the Governor, "Commissioner Howard Highlights $2.6 Million in Recovery Funding for Senior Nutrition Programs," May 15, 2009
  25. ↑ 25.0 25.1 The Star Ledger, "N.J. government transparency website launches," July 1, 2010
  26. ↑ 26.0 26.1 The Star Ledger, "N.J. website details finances of state independent authorities," November 29, 2010
  27. ↑ 27.0 27.1 The Star Ledger, "Gov. Christie to apply for $268M in federal education aid bill signed by Pres. Obama," August 11, 2010
  28. ↑ National Taxpayers Union, "A Letter to the Nation's Governors: Ensure Transparency and Accountability by Posting Stimulus Expenditures Online," March 10, 2009
  29. ↑ Wall Street Journal, "Stimulus Spending by State," April 23, 2009
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