OLS Official Warns Of Slow Growth

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A state official December 12 warned that New Jersey could possibly experience a $750 million budget deficit if revenue collections continue at their current pace for this fiscal year.  How the shortfall will affect, this, or next school year budgets is not known at this juncture.

Catherine Brennan, an official for the nonpartisan Office of Legislative Services, said that this was not a shortfall projection and that more than two-thirds of the state’s annual collections must be made over the remaining months in the fiscal year.

“The initial revenue weakness, however, gives grounds for caution,” she testified at an Assembly Budget committee hearing

The growth for major revenues through October came in at one percent, according to OLS estimates. The target is much higher, at 3.6 percent growth.

Among the major revenues, gross income tax collections saw 1.1 percent growth, sales tax experienced a two percent growth and corporation business tax collections were down 6.6 percent. Brennan also noted that about 20 other states in the United States are experiencing weak collections for the start of FY 2017.

Treasurer Ford Scudder was scheduled to speak before the committee but declined, citing concerns about testifying during the state’s bond underwriting period.

NJPSA will keep you posted as new information becomes available.