Gov. Phil Murphy says he’s confident that he and lawmakers can work out their issues in budget talks — advancing a “landmark” tax relief program for seniors and putting in place the corporate tax he envisions closing NJ Transit’s looming budget hole.
NJ Advance Media reported late last month that a battle is brewing over competing budget spending priorities. Murphy and legislators need to reach a deal on their budget by June 30 to avoid a government shutdown this summer.
Murphy initially opposed the Stay NJ program championed by Assembly Speaker Craig Coughlin before reaching a compromise with legislators last year, ultimately touting the program as important tax relief. Under a bill the governor signed, seniors would be refunded half of their property taxes starting in 2026, with a maximum rebate of $6,500. Individuals or couples who earn more than $500,000 a year are not eligible.
Separately, Murphy has proposed reviving a 2.5% corporate tax surcharge on wealthy corporations as a continuous funding source for NJ Transit, which otherwise projects a billion-dollar deficit starting with the 2025-26 fiscal year.
On WNC’s “Ask Governor Murphy” call-in show Wednesday, host Nancy Solomon asked Murphy about the reported “unhappiness” over the talks — and legislators’ apparent concerns that the effort to fund NJ Transit could “take money away from Stay NJ.”
But Murphy said New Jersey can handle both initiatives. He described Stay NJ’s funding as “under discussion” during the current budget negotiations.
“I’m not buying it,” Murphy said. “Having been chair of the National Governors Association of the Democratic Congress, I’ve seen how budgets are done around the country. We do a really good job.”
The NJ Advance Media report said Coughlin could make his support for the corporate tax contingent on more funding for Stay NJ — which only goes into effect if the state meets several financial benchmarks, including committing 12% of its annual spending as surplus. Some reports have also suggested Coughlin could seek funds from the corporate tax to bolster Stay NJ.
Murphy noted his budget proposal adds $200 million to the $100 million the state set aside in 2023-24 to fund Stay NJ.
“So we’re sort of building up, we climb these mountains over several years, so that’ll get us to $300 million,” Murphy said.
Murphy has previously said the state would set aside $300 million in the 2025-26 budget, bringing the total costs saved up for the Stay NJ rollout to $600 million.
Murphy also brushed aside a question about whether he’s worried legislators might not ultimately agree to the corporate tax break — potentially setting NJ Transit up for service cuts.
“I won’t get into the specifics, but I feel really good about the relationship that we have with the Senate president and the speaker of the General Assembly in their respective caucuses, and none of this is easy,” Murphy said.