Ciattarelli threatens suit over Murphy borrowing plan - New Jersey Globe
Republican Gubernatorial candidate Jack Ciattarelli threatened to sue Gov. Phil Murphy over a borrowing plan the latter is pushing through the legislature.
“It’s unconstitutional to borrow money to balance our state budget,” Ciattarelli told the New Jersey Globe. “It’s that simple, and on behalf of New Jersey, we’re not going to sit here and let Murphy plunge New Jersey deeper into debt.”
New Jersey faces a budget deficit of roughly $10 billion through the end of the next fiscal year after months of virus-fueled lockdowns that have seen most businesses put through extended closures.
To bridge that gap, Murphy is proposing a plan that would allow the state government to bond for budget financing purposes in the 2020 and 2021 fiscal years.
Though an Assembly vote on the measure has been scheduled for early June, details about Murphy’s plan remain scant.
Treasurer Elizabeth Muoio last month issued a bond disclosure that said the bill would allow New Jersey to borrow up to $5 billion, but no amounts were listed on the draft legislation.
“Decisions are always easier when transparency is available for all to consider. That has not been the case with Murphy’s bonding proposal,” said Ciattarelli, a former assemblyman. “Again, we don’t know how the bonds are going to be repaid, what taxes would be increased to repay them, what the money would be spent on.”
Further complicating matters is an opinion issued earlier this month by the non-partisan Office of Legislative Services that warned portions of Murphy’s plan could fail to pass constitutional muster.
Borrowing that deals with expenditures directly related to the COVID-19 crisis would be allowed, OLS said, but a 2005 OLS opinion bars bonding to balance the state budget.
“Not only is borrowing to balance the budget unconstitutional, in essence, Murphy is borrowing to make pension payments, and that too is unconstitutional,” Ciattarelli said.
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