On the heels of New Jersey’s new budget, which eliminated an $11 billion revenue shortfall, the legislature in Trenton is preparing for the next projected deficit.
The Office of Legislative Services says the state faces a $10.5 billion structural deficit in the fiscal year that begins next July First. Assembly Republican Budget Officer Joe Malone says legislative changes are needed to cut some spending requirements.
“The large areas were the pension fund and the pension requirements, the school funding issue, also homestead rebate issues,” he says.
Budget Committee chairman Lou Greenwald says reforms to maintain the pension system should be tied to requiring the state to make its pension payments.
“Unless the state makes a contribution,” he says. “There is not enough reform and there is not a strong enough rebound in the economy that will solve this problem.”
Greenwald says the state’s pension fund obligation accounts for about 30 percent of the structural deficit.