S643

Sponsored by:

Senator DECLAN J. O'SCANLON, JR.

District 13 (Monmouth)

Senator STEVEN V. OROHO

District 24 (Morris, Sussex and Warren)

Co-Sponsored by:

Senators Testa and Thompson

SYNOPSIS

Requires Governor to transmit budget sustainability statement along with annual budget message.

CURRENT VERSION OF TEXT

Introduced Pending Technical Review by Legislative Counsel.

An Act requiring a budget sustainability statement to be transmitted with the Governor’s annual budget message and supplementing Title 52 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. The Governor shall transmit to the Legislature, together with the budget message, a complete budget sustainability statement for the fiscal year next following the ensuing fiscal year. The budget sustainability statement shall include:

(1) an analysis of the sustainability of all appropriations and permissions to spend recommended by the Governor from the General Fund, other budgeted State revenues, other dedicated funds and federal aid, and trust funds in the fiscal year next following the ensuing fiscal year. The analysis shall rely exclusively on a reasonable estimate of revenue anticipated pursuant to current State and federal laws during regular collection cycles and without any proposed new or additional sources of State tax revenue or a reduction in the estimated undesignated fund balance;

(2) an accounting of any structural imbalance between the amount of spending anticipated and the estimated amount of revenues anticipated in the fiscal year next following the ensuing fiscal year;

(3) an accounting of all nonrecurring revenues, including revenues anticipated in the ensuing fiscal year from a brief, limited collection opportunity, from a special, short-term duration revenue enhancement, or from a non-routine financing or collection effort;

(4) an accounting of any reduction in State revenue collections due to the expiration of a law authorizing the collection of a tax or fee;

(5) an accounting of any increases in appropriations required pursuant to the State Constitution or any provision of any law or contract, including, but not limited to, amounts necessary to pay principal and interest due on capital projects financed via general obligation bonds and appropriations-backed contract bonds, issued by State independent authorities;

(6) an accounting of any increases in appropriations required pursuant to a collective bargaining agreement; and

(7) an accounting of any increases in appropriations for public assistance programs, including, but not limited to, the State Medicaid Program and Work First New Jersey.

b. The total amount of any increases in appropriations projected pursuant to paragraphs (5) through (7) of subsection a. of this section shall be offset by a reasonable projection of the amount of additional revenue anticipated to be collected from State recurring revenue in the fiscal year next following the ensuing fiscal year and any estimated decrease in appropriations required pursuant to the State Constitution, or any provision of law or contract.

The amounts projected by the Governor in the budget sustainability statement shall be adjusted on a current services basis for program specific inflation, previously enacted program expansions and eliminations, and caseload or population changes, accompanied by an explanation of any underlying assumptions and methods used to calculate all current services basis amounts.

2. This act shall take effect immediately and shall apply to the Governor’s annual budget message for the fiscal year beginning July 1 next following enactment.

STATEMENT

This bill requires the Governor’s annual budget message to include a budget sustainability statement. This bill is intended to improve the stability of the State fisc by requiring the Executive Branch to engage in budget planning practices covering two full fiscal years.

The budget sustainability statement will provide an analysis of the feasibility of funding the appropriations at the level proposed in the budget message in the next succeeding fiscal year without increasing taxes or reducing the State’s undesignated fund balance.

The bill also requires the budget sustainability statement to consist of an accounting of all one-time, non-recurring State revenues, an estimate of any decline in State revenue collections due to the expiration of a law authorizing the imposition of a tax or fee, and estimates of any increases in appropriations required to make debt service payments and meet other contractual obligations, including collective bargaining agreements, and to support public assistance program, such as the State Medicaid Program and Work First New Jersey.

Any increases in appropriations projected in the budget sustainability statement may be offset by a reasonable estimate of the amount of additional State revenue anticipated to be collected in the fiscal year next following the succeeding fiscal year and any estimated decrease in appropriations required pursuant to the State Constitution, or any provision of law or contract.