Tag: COVID-19

The state Legislature’s top Republican lawmakers are floating a plan for how they want the Murphy administration to spend the $6.4 billion it’s getting from the Biden team under the American Rescue Plan.

Lawmakers on both sides of the aisle have shown an increasing desire for more input on how Gov. Phil Murphy’s team spends the federal COVID-19 relief money, arguing that the input was lacking with the Trump-era funds.

As of Feb. 28, the state spent nearly $1.97 of the $2.4 billion it got under the Coronavirus Aid, Relief and Economic Security Act, according to state auditor David Kaschak. That’s part of $7.9 billion in federal aid that’s gone to the state either directly or to public agencies like mass transit, local governments or universities.

Both parties argued that they did not have anywhere near enough input on where those funds went and that it was done entirely by the administration.

“New Jersey will soon be swimming in cash from the federal government and I want to make sure those funds are dedicated to helping our taxpayers and the unemployed,” Assembly Republican Jon Bramnick, R-21st District, said April 8 in a statement.

The presence of federal aid, plus more than $4 billion in new debt and soaring consumer demand, mean the state is flush with billions of dollars more in cash, defying expectations that the COVID-19 business shutdowns would crash the economy and state finances.

During an April 6 budget hearing, Senate Budget Chair Paul Sarlo, D-36th District, pressed New Jersey State Treasurer Elizabeth Maher Muoio on whether “we have commitments from you that your administration will work with the Legislature” on how to spend the money, something which the administration said it very much favors.

To that end, Murphy is in the midst of approving $100 million of grants for COVID-hit businesses, paid for with funds from the CARES Act. The $6.4 billion is not included in Murphy’s $44.8 billion spending plan, which covers expenses between July 1, 2021 and June 30, 2022.

“Any decision on how to spend American Rescue Plan funds will be contingent on upcoming guidance from the US Treasury Department,” said Alyana Alfaro, press secretary for the governor’s office.

Wish list

The Senate GOP caucus said it wants the Murphy team to spend $2.5 billion over three years on bolstering the state’s unemployment fund. Of that, $1 billion would go toward paying off any debt that the state took on in order to finance state-run jobless benefits before any interest accrues.

Another $1.5 billion would go toward refilling the state unemployment system and staving off employer tax increases that would typically finance the years-long replenishment.

Half a billion dollars would go toward upgrades to the state unemployment system’s “antiquated computer systems, and for IT upgrades with the state Motor Vehicle Commission.”

The plan calls for $1.5 billion over three years for long-term capital projects for “state, public and private schools, institutions of higher educations, local governments, libraries” and other public agencies, so that the state would not accrue more debt.

Another $1 billion would go toward COVID-relief aid for pandemic-hit businesses and nonprofits, half a billion dollars for mortgage and rental assistance programs, and another $500 million toward staving off any cuts in state aid to New Jersey’s K-12 school districts.

“Our plan puts the [$6.4 billion] of federal funds to use in a responsible way that will help New Jersey overcome the challenges of the pandemic,” Sen. Steven Oroho, R-24th District, the top Senate Republican budget lawmaker, said on April 8. “If we don’t undertake those costly upgrades now when we have the money, they’re unlikely to happen any time soon.”

The plan does not include any mention of using funds to pay down any of the state’s older, higher-interest debt – something floated by Murphy and backed by several key figures in the state’s business community.

Sarlo backed a similar proposal, and on April 6 said that “it’s incumbent upon us to work with this administration… to pay down debt and… make sure that we make these investments strategically… that we plan for the next two or three fiscal years.”

Editor’s note: This story was updated at 4:45 p.m. EST on April 9, 2021 to include comments from the governor’s office.

Gov. Phil Murphy and his wife, First Lady Tammy Murphy, are scheduled to each receive their first doses of the COVID-19 vaccine this April  9 at the Atlantic City mega-site.

“We were already planning on being there to complete our circuit of visiting all six vaccination mega-sites, and we thought it would be the perfect opportunity to showcase a terrific location with plenty of vaccine availability,” the governor said at his April 7 COVID-19 press conference.

Tammy and Phil, who are 55 and 63 respectively, became eligible to get their vaccine as of April 5, after eligibility opened to anyone above the age of 55, and anyone above the age of 16 who has a developmental disability, under an order he signed.

Full eligibility is opening up on April 19 for anyone over the age of 16, which Murphy said is part of a race against the spread of a new wave of cases fueled by the more contagious B.1.1.7 variant.

Hospitalizations climbed to 2,375 patients as of April 6, the highest since the second wave in mid-February, and there are a total of 3,578 cases – 26% up from a month ago. New Jersey and New York have experienced some of the worst spreads of COVID-19 in recent weeks, according to federal health data.

“This is why we are continuing to enforce our statewide mask mandate, especially for indoor activities where we know transmission is more likely and also in the face of the more-transmissible variants we know are among us,” Murphy said.

“It is also a reason why we moved up our vaccine eligibility timeframe aggressively, so we can have more people into the ranks of the fully vaccinated in a shorter amount of time.”

The best- and moderate-case scenarios call for hospitalizations and daily cases to peak on April 18 and then coast down over the summer. A worst-case scenario calls for a peak dragging on from May to June, in what Murphy described as a “long hot summer.”

“And, the most troubling aspect of the high-case scenario isn’t necessarily the peak – although the numbers are concerning – but the slow decline on its other side,” Murphy said.

As of April 7, the state fully vaccinated nearly 1.9 million adults, either through the two-shot Pfizer or Moderna versions, or the one-shot Johnson & Johnson version.

That figure is 40% of the state’s self-imposed goal of getting shots in the arms of 4.7 million people by June 30, according to Murphy.

Vaccine supply of all three versions has steadily increased week over week for the state, according to New Jersey Health Commissioner Judith Persichilli.

The vaccines are a vital component of permanently rolling back restrictions on businesses, travel and public gatherings, which have been in place this past year to keep the spread of the virus at bay.

President Joe Biden, a fellow Democrat, has pleaded for governors to halt their state’s reopenings in order to counter new surges. But, Murphy nonetheless relaxed many restrictions in recent weeks, including last week when he relaxed the capacity at indoor and outdoor venues like concert arenas, and raised the outdoor gathering capacity.

Several of the New Jersey’s largest chambers of commerce and business trade groups are floating a major paydown of some of the state’s $44 billion in debt using federal relief funds from the Biden administration, as part of the first step for recovery from the COVID-19 recession.

New Jersey is slated to get roughly $6.4 billion in federal aid under the relief plan that President Joe Biden signed in March. Another $4 billion is going to municipal and county governments, another $2 billion toward New Jersey Transit, and hundreds of millions of dollars for the state’s airports.

For the state at least, the goal is to free up money in the coming years by paying down some of the debt, especially some which carry higher interest rates, according to Ralph Albert Thomas, chief executive officer and executive director of the NJ Society of CPA’s.

New Jersey incurred roughly $4 billion in debt in order to pay for COVID-19 expenses and keep the lights on, but the borrowing was done at a time when the full impact of the pandemic on the state’s finances was still not known. By some estimates, New Jersey is one of the most indebted states in the nation.

Thomas was joined by New Jersey Business & Industry Association President and CEO Michele Siekerka who ran the press conference, African American Chamber of Commerce of NJ President and CEO John Harmon, Chamber of Commerce of Southern NJ President Christina Renna, Association Business Solutions Senior Vice President Libby Vinson, IBEW Local 102 President Bernie Corrigan, and New Jersey Institute of Technology President Joel Bloom.

“Let’s get ourselves back on a steady platform that we can move forward with,” Thomas said. “Let’s use it to pay down other debt that we can get rid of and get that addressed.”

Gov. Phil Murphy has been mute so far on how the state would use any of the $6.4 billion, and many state governments are awaiting guidance from the Biden administration. None of those funds are scored into Murphy’s proposed $44.8 billion spending plan.

But state budget lawmakers – the first step in an approval process for sending Murphy a budget to sign – are scheduled to receive an update from the governor’s executive branch this Tuesday, April 6 on the status of what funding is in store for the state.

The Murphy administration has slowly doled out the more than $2 billion the state received under the Trump administration, including the recent approval of $25 million in grants for the state’s smallest businesses.

Renna touted that kind of spending – direct grants to businesses, from the New Jersey Economic Development Authority – as a prime example of how the Biden aid should be spent.

“We need more of those kinds of programs for the immediate [need] for our small businesses, or our nonprofits, for our most in-need that need money today, no strings attached,” she said.

Siekerka suggested that what programs the state pays for with the federal aid need to be non-recurring—meaning they would not turn into projects that run a tab every year.

“We must not create new programs with this nonrecurring money or we will risk increased taxes in the future to continue to fund new programs,” she said.

“[B]ecause we can use this money for costs incurred through December 2024, we have the ability to take a multi-year approach to this spending plan,” she continued.” Living year to year on an annual budget always makes it difficult to plan for more comprehensive spending. Now, we have the opportunity to do just that.”

That means spending on major upgrades to the state’s infrastructure and cash infusions into workforce training. And it means the use of some kind of centralized point of contact within Murphy’s office to avoid any kind of redundant spending by different entities on the same expenses.

NJBIA Vice President of Government Affairs Christopher Emigholz floated a $450 million payment to lessen how much the state would need to otherwise rely on payroll taxes.

Murphy approved a bill in January that phases in the tax increases over a two-year period in order to rebuild the depleted unemployment fund, at a time when over 2 million New Jerseyans filed for unemployment over the past year.

“Putting money in there would lessen the tax increase. Over the next couple years, you’re going to see maybe that three-year tax increase maybe becomes a two-year tax increase,” he said.