NEW JERSEY (KYW Newsradio) — The state budget for New Jersey is due at the end of the week, and a compromise on the StayNJ senior tax relief package, which will cut property taxes in half for most seniors starting in 2026, means it’s all but a done deal.
But some budget experts, like Sweeney Policy Center Executive Director Mark Magyar, say the state really needs to get better at planning ahead, rather than doing the budget one year at a time.
“There are difficult fiscal times ahead and the difficult fiscal times will be inherited by the next governor,” Magyar said.
Magyar’s team projects a tax collection shortfall of up to $18.5 billion in the next five years.
“There will have to be choices made.”
He says they expect a recession to hit Wall Street, which would have a big impact on New Jersey’s top earners, leading to a dip in tax collections. He added that the state won’t be able to keep up its current level of service if revenue drops like his team expects it will, but noted the “good news,” which is that the state has an $8 billion surplus – thanks in part to federal funding.
Magyar says pandemic relief funding has helped prop up state budget. He said in addition to planning ahead, the state must do better at anticipating problems to ensure taxpayers aren’t hit with increases when federal funds dry up and the surplus is gone.