Good Morning, Chair Pintor Marin and members of the Committee. Thank you for the opportunity to testify today on the Fiscal Year 2026 budget.
The governor’s proposed budget takes important steps toward fiscal stability in the long term, particularly by raising additional revenue. Although NJPP would prefer more revenue measures targeting high-wealth individuals and large corporations that profit from our state, it’s clear that additional revenue is needed, especially as community grant programs and affordability initiatives such as the Child Tax Credit remain flat-funded or face cuts. To ensure New Jersey remains an affordable place for all residents to raise a family and thrive, the state budget must include more revenue.
The need for revenue and responsible budgeting becomes even more urgent in light of potential federal cuts. The legislature and governor have made clear that even minor federal reductions could have devastating effects on New Jersey’s state budget and on New Jerseyans who depend on federal funds for health insurance, food assistance, and affordable housing. The proposed surplus would only sustain the state for 39 days in the event of an economic downturn or federal cuts.
Now, at a time when working families are struggling with affordability, the budget offers little additional aid to help them make ends meet, including:
- No increase in Child Tax Credit or Earned Income Tax Credit benefits;
- No increase in Work First New Jersey cash assistance for low-income households;
- No increase in rental assistance, child care assistance, or food assistance.
Instead, the budget includes cuts to key programs such as community colleges, legal services, and lead paint remediation, while diverting funds from long-term investments like the Affordable Housing Trust Fund and Clean Energy Fund.
New Jersey must not follow the federal trend of cutting benefits and programs for working- and middle-class households while maintaining tax breaks for wealthy households and big corporations. Rather, the state should pursue progressive revenues policies that ensure those with the most to contribute their fair share, as outlined in NJPP’s 2024 report Fair and Square: Changing New Jersey’s Tax Code to Promote Equity and Fiscal Responsibility.
These measures include:
- Adopting the governor’s proposal to increase the assessment on property sales over $1 million
- Adding income tax brackets for very high earners above $2 million, $5 million, and $10 million
- Requiring multinational corporations to disclose their profits from foreign tax havens
- Increasing tax enforcement to improve compliance with existing tax laws
By ensuring that the wealthy contribute more equitably, the state can expand its ability to help working New Jerseyans afford the cost of living in the state and build the investments in school construction, public transit infrastructure, and climate resiliency that the state needs for a brighter future.
One final note on future fiscal planning: The Fiscal Year 2027 budget will face significant constraints due to the expansion of the Stay NJ program, which is slated for funding this year despite falling short of the surplus targets outlined in the legislation. While the state has less money to spend and potential federal cuts looming, the program is set to distribute more than $500 million in Fiscal Year 2026, disproportionately benefiting high-income, wealthy homeowners. These payments partially rely on prior years’ contributions, but Fiscal Year 2027 will have no such cushion — doubling the cost to more than $1 billion and further deepening the deficit.
The state budget can and should reflect a commitment for shared prosperity, where revenue generated by working New Jerseyans supports schools, transportation, and communities that make the state strong. That requires raising additional revenues from the state’s wealthy and reducing cuts to programs that promote affordable and opportunity for all.
