New Jersey lawmakers poised to give Murphy power to borrow $5B from federal government

The New Jersey Assembly, by a vote of 52-28, approved a bond-borrowing bill called “reckless” by Republicans and a “necessary step” by Democrats.

The bill passed Thursday would allow Gov. Phil Murphy to borrow up to $5 billion from the federal government to cover budget shortfalls caused by the coronavirus pandemic. The bill still awaits consideration by the state Senate.

Assembly Majority Leader Lou Greenwald said the bill was necessary.

“Securing this funding will help the state meets its obligations to our schools, higher education institutions, municipalities, hospitals and, most importantly, to residents who are struggling as a result of the effects of the pandemic,” Greenwald said.

Republican Jay Webber said the bill gives the governor an unlimited amount of credit to use when the federal government makes more stimulus available to the states.

“This is the most wrongheaded and reckless policy I have seen in my time here” Webber said. “Once again, the majority party has demonstrated that it knows only one way to manage an economy, and that is to spend and to tax and to borrow.”

Minority Leader Jon Bramnick said lawmakers should not have their judgment clouded in the middle of a crisis.

“This bill proposes and will institute a new statewide property tax and new personal property tax. This is all done without voter approval,” Bramnick said. “The question I would have to the majority party, which tax or taxes will be raised, and by how much?”

Murphy called the notion of property taxes “kind of laughable” at his Thursday news conference.

“It’s the opposite,” Murphy said. “If we weren’t able to get this bonding, in the absence of that we’d be forced to do the awful of laying off literally at the state level of 200,000 and at the local level untold numbers of first line workers of fire, police, EMS, educators, health care workers – the very people we need right now. What would you do if you are a municipality? You would have no choice but to raise property taxes.

“This not only has nothing to do with raising property taxes, this is the one weapon we’ve got on our disposal to prevent that, in fact from happening,” he added.

Murphy said the bond contained “boilerplate” language that was in other bonds and criticized lawmakers opposing it.

“And if folks keep raising their voices on this point, I have a response for them,” the governor said. “I’m going to read their name alphabetically for all the votes positively that they took to support other bonding in the past with the exact same language.”

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