Earlier today, the New Jersey Senate Budget and Appropriations Committee voted to pass S1350, a bill that would create a Revenue Advisory Board to provide consensus revenue forecasting, a budgeting best practice long-recommended by good-governance advocates and budget policy experts. The bill, amended in committee, would also require the Governor to report multi-year forecasting of expected spending, more detailed monthly reporting, and an annual financial stress test. In response to this vote, New Jersey Policy Perspective (NJPP) releases the following statement.
Sheila Reynertson, Senior Policy Analyst, NJPP:
“Consensus revenue forecasting would de-politicize the budget-making process, help boost public trust in state government, and improve the state’s standing with credit rating agencies. While this policy change may sound technical and benign, having the legislative and executive branches base their budget proposals on an agreed-upon revenue estimate will help limit budget gimmicks and redirect attention to more important debates about which programs to prioritize.
“This legislation also incorporates other budget planning tools to help lawmakers fund vital public services over the long-term, accounting for inflation and changes in the economy. Taken together, these reforms would break the cycle of politically easy maneuvers that have plagued New Jersey’s finances and allow everyone — lawmakers and the public alike — to better understand the consequences of tax and budget policy decisions.”
Read more about consensus revenue forecasting and other budgeting best practices in NJPP’s April 2021 report, Tools for Building a Healthy Budget.
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New Jersey Policy Perspective (NJPP) is a nonpartisan think tank that drives policy change to advance economic, social, and racial justice through evidence-based, independent research, analysis, and advocacy.