Governor Murphy’s Budget Address Supports Education Through Full State Aid Formula Payment, Preschool Expansion, Full Educator Pension Payment and School Infrastructure Funding for FY 2023 Budget
This afternoon, Governor Phil Murphy gave the first Budget Address of his new term of office before a joint session of the NJ State Legislature. Wearing the blue and yellow colors of the Ukraine, Murphy began his address by voicing his strong support for the people of the Ukraine before moving on to the business of the State of New Jersey.
The proposed budget totals $48.9 billion, up from $46.4 billion last year based on revenues that are $4.6 billion ahead of FY 2022 projections. This revenue growth is based upon multiple factors including significant amounts of federal aid, wage growth, and a strong stock market.
In framing his budget proposal, Governor Murphy referenced the challenges and the bright spots of the pandemic, noting the important contributions of educators. He noted this budget was a reflection of the “need to move forward, to create opportunity for every family and to make our state more affordable.”
To this end, he began by describing his property tax relief program the ANCHOR program, to be considered alongside strong investments in public education, and his commitment not to raise any new taxes on New Jersey citizens. You can read the full text of the Governor’s Budget Address here.
Specific Highlights of the Governor’s Budget Proposal Include:
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- The ANCHOR Property Tax Relief Program, formerly the Homestead Rebate program, is expected to cost nearly $900 million and will provide rebates to up to 1.15 million New Jerseyans including both homeowners and renters.
- Murphy’s proposal includes a total of $9.9 billion investment in our public schools by making the full payment on year five of the planned seven-year redistribution of school aid established in S2. Overall, Murphy’s budget proposal includes $650 million increase in new education aid. A $20 million fund of stabilization aid will be available to those districts hard hit by S2, who lost adjustment aid in this redistribution. Extraordinary special education costs will be addressed through a special fund held to the same funding level as last year.
- Preschool funding for three- and four-year-olds will be increased by $68 million, which includes $40 million for new districts (3,000 new seats) to participate in the program. Murphy has increased preschool funding by $310 million since he first took office.
- School infrastructure and facilities needs that have long been placed on the back burner are proactively addressed through a $430 million investment in school construction and renovation projects.
- The spending plan honors the state’s commitment to educators and other public employees by making a second full payment into the state’s pension system, totaling $6.82 billion.
- The plan includes other critical investments in transportation, housing, health care and business sectors in New Jersey.
- The budget includes a $4.2 billion surplus which is nearly twice the size of last year’s surplus, but still below what states are recommended to set aside as a cushion.
- $1.3 billion is set aside for debt relief. The Governor noted New Jersey’s first upgrade in New Jersey’s credit status by Moody’s, the first bond rating upgrade since 1977 which will lead to taxpayer savings in the cost of state debt.
- Murphy’s spending plan does not include any new taxes or fees. He is instead waiving several fees for one year.
NJPSA applauds Governor Murphy’s strong commitment to public education and the educators who serve our students as evidenced by his strong and supportive FY 2023 budget proposal. A budget is a statement of one’s priorities and through this budget proposal, Governor Murphy has shown his steadfast commitment to our students at every age and stage of learning. He has recognized the critical importance of all educators in meeting the needs of students by honoring the state’s commitment to fully pay the pension bill that is due. He has continued his partnership with the N.J. State Legislature by fully funding the revised school funding formula according to the negotiated schedule; and he has pro-actively addressed the long-ignored issue of school facilities needs statewide. These commitments, backed by strong state investments, will help our public schools and the educators who lead them, in our collective recovery efforts from the long pandemic with its impacts on learning and student welfare.
With this Budget Address, the State Budget process officially begins. School districts should receive their state aid figures later this week. The State Legislature, through its Budget Committees in each house, will begin its budget review process which includes a few early opportunities for public testimony.
Of course, the devil is always in the details and how this budget proposal may impact your school and district. As NJPSA begins its work during the budget process, we urge all NJPSA members to reach out to the NJPSA Government Relations department to share any budget issues or impacts with us, particularly as you consider your state aid figures within the next week or so. Please contact Debra Bradley dbradley@njpsa.org or Jennie Lamon jlamon@njpsa.org.