The New Jersey Legislature's nonpartisan
budget expert yesterday warned that the state is more likely to
face a revenue decline than a windfall in coming months, amid
growing fears that the slumping economy is putting the brakes
on state finances across the nation.
"I do not recall a year in which
I was less comfortable with the revenue forecast we are putting
before the committee," David Rosen, budget director for the Office
of Legislative Services, told the Assembly Budget Committee.
Rosen confirmed that OLS believes
overall revenues over the next 15 months will be at least $133
million less than the Corzine administration projected just one
month ago.
"I don't think we're falling off
a cliff," Rosen said, but added that "I think there's real reason
for concern.
"It should be clear that most of
the risk in this forecast is on the downside and it is easy to
imagine plausible economic scenarios in which the outcome is considerably
more dire than the numbers we have provided," Rosen said.
Also testifying yesterday was acting
Treasurer David Rousseau, who is slated to give a final revenue
update in mid-May after April tax payments arrive. He said he
agrees with OLS that "there is a risk that further downward revisions
may have to be made to the revenue projections as we move forward."
Meanwhile, Stateline.org has reported
that the Nelson Rockefeller Institute of Government, which monitors
state revenues, is expected shortly to release a study that shows
state tax collections have fallen to their lowest level in nearly
five years. "It's bad and going to get worse. We just can't say
how much worse," Scott Pattison, executive director of the National
Association of State Budget Officers, told Stateline.org, which
tracks state issues as a public service and is funded by Pew Charitable
Trusts.
Gov. Jon Corzine said yesterday
he prepared his proposed $33 billion budget with the national
economy in mind. "Our biggest problem right now is we've got a
national recession," Corzine told reporters. "And we can do some
things in New Jersey, but there is a tide coming in."
Assemblyman Louis Greenwald (D-Camden),
chairman of the legislative panel, said while he was relieved
the OLS forecast wasn't more dire, it means the state is unlikely
to realize a major windfall to forestall some of the $1.9 billion
in actual budget cuts proposed by Corzine. "We are facing an economic
climate that is bleak right now and the worse thing you could
do is overestimate revenues," he said.
Assemblywoman Alison Littell McHose
(R-Sussex), a committee member, said Rosen's testimony made it
clear that lawmakers must expand the governor's list of targets
for trimming. "Today's revenue projections only reinforce why
it is vital that we go beyond the level of cuts proposed by the
governor and make even deeper cuts to this budget," she said.