Assembly Passes FY2008 State Budget

By teel

ASSEMBLY PASSES FY2008 STATE BUDGET

$33.5 Billion Fiscal Plan Has No New or Increased Taxes or Fees,
Includes Significant Business Tax Cuts, Record Levels of Property Tax Relief

(TRENTON) - The Assembly today passed a balanced $33.5 billion fiscal year 2008 state budget that avoids any new or increased taxes and that provides historic levels of property tax relief and tax cuts for businesses and financially at-risk working families.

"This budget should be called the Property Tax Relief Act of 2007," said Budget Committee Chairman Louis Greenwald (D-Camden). "This budget addresses the number one pocketbook concern of New Jersey residents while investing in economic growth, groundbreaking scientific research, and reducing the tax burden for families in need of a break."

Greenwald noted that the FY2008 plan (A-5000) was created through a revamped process that was enhanced to maximize public input, accountability, and transparency. An expedited budget review process ensured that the budget legislation would be produced well in advance of the July 1 constitutional deadline. For the first time ever, the Assembly Budget Committee opened and closed the budget review process with public hearings. The Committee also required all legislators to submit by June 6 formal resolutions for all requested changes to the budget.

"This budget process isn't just better than last year, it's better than any year," Greenwald said.

Greenwald crafted the reforms in response to Governor Jon Corzine's call for more openness in the annual state budget process.

"Every line item in this budget has been reached through an open process," said Greenwald. "The overarching goal this year has been to help property taxpayers while restoring the public's faith that their money will be wisely invested in programs and projects aimed at improving New Jersey's quality of life."

The budget received final legislative approval in the Assembly with a 50-30 vote.

Pertinent facts about the FY2008 include:

TOTAL APPROPRIATIONS: $33.48 billion

ANTICIPATED SURPLUS: $601.4 million

PROPERTY TAX RELIEF

Most in state history.

Nearly $16.7 billion - increase of nearly $2 billion.

Fully funds maximum 20 percent property tax cuts for majority of households; doubles amount available for tenant rebates.

Roughly 50 cents of every dollar goes to property tax relief.

TAX CUTS

No new or increased taxes.

$275 million business tax cut through sunsetting of Alternative Minimum Assessment and reduction in the S-Corporation surcharge.

$36 million tax cut for additional 300,000 working families through expansion of Earned Income Tax Credit.

Elimination of seven-percent sales tax on non-profit health club memberships.

SENIOR CITIZENS/SOCIAL SERVICES

Full funding of PAAD and Senior Gold programs - no cuts in benefits or eligibility.

Proposed co-payments for prescriptions, outpatient hospital visits, and medical day care eliminated.

Community care provider agencies will receive three percent cost of living adjustments (COLAs) on January 1 - one percent higher than the original proposed budget.

HOSPITAL/HEALTH CARE

$776 million in total hospital aid - $173 million increase in state and federal funds from original proposed budget.

$133 million increase in charity care ($109 million in state funds and $24 million in federal funds); formula based on most-recently available data.

$40 million increase ($20 million state in state funds, $20 million in federal monies) to Medicaid Graduate Medical Education program; $60 million total.

EDUCATION

Largest school aid increase since 2000.

Minimum three percent increases; additional funding for non-Abbott districts, charter schools, schools with high concentrations of low-income students, and schools with full-day kindergarten.

Restoring $10 million in funding for adult education.

Providing additional $2.9 million for districts in need of improvement that are spending below minimum T&E levels.

RENTAL ASSISTANCE

Full funding of tenant assistance program.

MUNICIPALITIES & COUNTIES

First aid increase since 2005 - all municipalities receive a two-percent increase.

Restoration of $9 million to Extraordinary Aid program.

$8 million to provide match for federal FEMA relief for spring flood.

$10 million to relieve local taxpayers of burden for funding February 2008 presidential primary.

$10 million to assist counties in meeting cost of voter-verified paper trail requirements.

CANCER RESEARCH

Cancer research funding fully restored to last year's levels - approximately $60 million.