Category: Blog

New Jersey Has Less Than $1 Billion Left in American Rescue Plan Funds

Posted on by Sheila Reynertson

With less than $1 billion remaining in federal American Rescue Plan (ARP) funds, New Jersey’s unique opportunity to provide immediate relief to families and communities harmed by the pandemic is quickly slipping away. Roughly 85 percent of the $6.2 billion dollars in ARP funds have already been appropriated by Governor Murphy and state lawmakers, with more than $2.4 billion worth of federal funds included in the latest state budget. It’s hard to say whether this recent spending aligns with the Biden administration’s guidance to direct relief towards those disproportionately harmed by the pandemic, however, given the lack of transparency and publicly available information on these appropriations.

If used as intended by the Biden administration, ARP funds offer a once-in-a-lifetime chance to advance racial equity by investing in communities that were hardest hit by the pandemic and historically left behind in the lawmaking process. But with more than $5 billion appropriated behind closed doors and few details available to the public, lawmakers can and must do a better job of providing direct relief to workers, families, and communities who need the most help — and in a transparent manner that invites public input.

Newest Allocations Aid Institutions But Ignore Direct Assistance

The new state budget that took effect July 1 includes some big investments that align with how ARP funds should be spent: affordable housing development ($305 million), lead paint removal from homes ($170 million), new facilities to advance universal pre-K education ($120 million), and almost $100 million to upgrade state operations for social services.

But, despite repeated calls from policy experts, community leaders, and advocates to prioritize disproportionately harmed residents, elected leaders failed to deliver adequate direct relief to those who need it. The new ARP allocations through the budget did not include direct relief for immigrant workers, hazard pay for essential workers, rental assistance for those struggling to keep a roof over their head, or cash assistance for residents who maxed out their benefits through the Temporary Assistance for Needy Families (TANF) program. These deliberate choices made behind closed doors represent a lost opportunity to meet the moment and meaningfully improve the lives of New Jersey residents who are not paid enough to get by or cannot work at this time.

Transparency Not Treated as a Priority

Based on current, available documentation, each new allocation of ARP funds in the budget lacks any kind of description, meaning there is no way to tell who exactly benefits from hundreds of millions of dollars worth of spending. For example, lawmakers allocated $300 million to water infrastructure, but without basic details it’s unclear which communities will benefit and which will be left behind. Another $300 million was granted to Rutgers University, but only thanks to a reporter’s diligence do we learn that a third of it will pay for a new sports facility. Middlesex County’s community college and improvement authority each received $20 million, but without some context it’s difficult to determine the relevance of these one-time investments.

In other cases, the allocation goes to a new or existing program that will require ongoing funding, drawing into question the state’s commitment toward its success once the federal funds are gone. Case in point: The state’s only public hospital received $50 million for a building assessment plan, but with no guarantee that the plan will be implemented. The state’s new universal newborn home visit program was signed into law with much fanfare, but using these one-time fiscal recovery dollars ($6 million) to fund the first year casts doubt on whether the state will be able to sustainably fund the program in future years. Similar concerns arise around allocations for programs that are normally supported by state funds, like child-care subsidies ($48 million), grants for mental health ($15 million), and capital improvement projects across the state ($50 million).

The lack of information on ARP allocations calls into question whether some of these investments were necessary at all — especially for funds sent to private institutions that should have plenty of resources to cover the costs themselves. For example, $13 million has been granted to two health systems for “hospital infrastructure” and workforce education. The state should require extensive oversight of grants to private institutions at a minimum, including clawback provisions should misuse of this aid come to light.

What’s Next for ARP Funds

The state now has less than $1 billion remaining in state fiscal recovery funds that have yet to be designated — not including the $300 million in discretionary funds which the Governor can disburse in amounts of $20 million or less. The Joint Budget Oversight Committee (JBOC) will meet quarterly to approve proposed allocations above that $20 million threshold. The public has not been granted a meaningful process by which to weigh in on how the remaining dollars are spent and, based on the uneven quality of issuances so far, that must change. Lawmakers can start by allowing public testimony at future JBOC hearings — consistent with most other legislative committee hearings — so that policy experts, essential workers, and community leaders alike can weigh in on ARP spending proposals before they’re approved.

The New “Easy Enrollment” Program will Lower Barriers to Affordable Health Care

Posted on by Brittany Holom-Trundy

New Jersey took an important step towards improving access to health care when Governor Murphy signed legislation (A674/S1646) creating the Easy Enrollment program last month. This new program takes tax filing forms and unemployment claim applications and turns them into opportunities for uninsured residents to enroll in affordable health care coverage — all by checking a box.

With the Easy Enrollment program set to start at the end of 2022, uninsured residents who are filing taxes or an application for unemployment benefits can expect to:

  • Check a box on their tax form or unemployment benefits application indicating they would like information about how to enroll in affordable coverage.
  • Receive information from the Department of Human Services or Department of Banking and Insurance on their eligibility for NJ FamilyCare or GetCoveredNJ coverage.
  • Enroll in a coverage plan within the special enrollment period.
  • Avoid future fees for not having insurance by remaining enrolled for the rest of the calendar year.

 

Streamlining Enrollment Helps Those Facing Daily Barriers

Streamlining the enrollment process will make it much easier for uninsured residents to sign up for comprehensive health coverage, especially those who face information and time barriers to enrolling. Many of the nearly 700,000 residents who remain uninsured face language barriers or technical barriers in the enrollment process. Others have difficulty finding the time to enroll or gathering information about which plans are best for them, as they may work long or unpredictable hours, have long commutes, or have an unpredictable income and are unsure which coverage they can afford. Additionally, residents may be facing an abrupt end to existing coverage. In the case of young adults, they may be newly uninsured after being on their parents’ plan; for others who have been employed, they may face sudden loss of existing coverage after losing their job.

Maryland’s Easy Enrollment program, which began in 2020 and inspired many aspects of New Jersey’s program, has already succeeded in lowering these types of barriers for uninsured residents. The success of Maryland’s Easy Enrollment program is a good sign that the new program in New Jersey will result in more residents gaining health coverage, especially those who are often young, have low and perhaps seasonal income, and who may speak English as a second language or face other application barriers.

Simply Check the Box: Getting Info About Enrollment Will Be Easier Than Ever

Like Maryland’s program, New Jersey’s Easy Enrollment is designed to be as simple as possible: By adding a checkbox on tax forms and unemployment benefit applications, the state will provide residents with opportunities to enroll in affordable insurance they qualify for.

Each resident who checks this box will have their eligibility for different coverage options and subsidies confirmed based on their tax filing or unemployment application. Those participating in the program will then receive information about which coverage applies to them — whether it’s NJ FamilyCare (Medicaid and CHIP) coverage or coverage through GetCoveredNJ (the state health insurance marketplace) — and a special enrollment period of at least 30 days will begin. During that period, the resident can enroll in the coverage they choose and, in the case of marketplace plans, receive subsidies to lower the cost.

Additionally, if a resident enrolls in coverage through this program and remains enrolled for the rest of that calendar year, they will no longer have to pay the Shared Responsibility Payment, a fee paid by those who do not have health insurance coverage, as required by New Jersey’s individual mandate law.

Once the Easy Enrollment program is in full effect, enrolling in health coverage will be easier than ever for uninsured residents in New Jersey.

How the New Jersey Child Tax Credit Became Law

Posted on by NJPP Staff

When Governor Murphy signed the new state budget into law, New Jersey became the latest state with its own Child Tax Credit. Modeled on the highly successful federal Child Tax Credit expansion, the new program will provide eligible families with up to $500 per child under 6 years old.

Below, NJPP Senior Policy Analyst Peter Chen explains how the Child Tax Credit went from a proposal in an NJPP report published in February to a part of the budget deal between legislative leaders and the governor.

NJPP Senior Policy Analyst Peter Chen (@ptrchn1):

 

Affordable for Some: What’s Included and Missing in New Jersey’s FY 2023 Budget

Posted on by Sheila Reynertson

In a year of unprecedented surplus and abundance, the new state budget signed into law by Governor Murphy had the opportunity to transform government and build an economy that works for everyone. With rising prices on everyday needs — and many New Jerseyans still struggling to get back on their feet from the COVID-19 recession — this was a chance to make the state affordable for all. But instead of providing transformational direct relief to low-paid working families who have been historically left behind in the policy-making process, lawmakers used a bulk of the state’s record-setting $10.7 billion surplus on tax rebates for upper-middle class homeowners, tax credits for corporations, and a gimmicky sales tax holiday for everyone else.

Some important, positive changes were enacted in the spending plan, namely a new state-level Child Tax Credit, but it’s hard to see the budget as anything but a missed opportunity to help those who have the least and to start dismantling persistent economic and racial disparities. Given the opaque and rushed process, with a $50.6 billion spending package crafted behind closed doors and immediately voted out of committee before anyone had a chance to read the bill, it’s easy to see how lawmakers left out important proposals that would have benefited low-paid workers and their families.

From the onset, “affordability” was the major theme of this year’s budget season, but many of the policy proposals that emphasized “affordability” would have primarily benefited the already wealthy and big businesses. This is why essential workers and advocates repeatedly posed the question, “affordable for who?” — and for good reason. While other states used their unexpected windfall of state dollars to dramatically expand the social safety net, tax credits for working families, pandemic relief for immigrants, and hazard pay for essential workers, New Jersey lawmakers left these policy proposals on the cutting room floor. And, unlike years past, there is no shortfall of dollars to explain inaction on policies to help those fighting the hardest to get by, only a shortfall of political will. 

Federal Funds

A combination of strong revenue collections and federal pandemic relief presented the state with an unprecedented surplus and $3 billion in remaining American Rescue Plan (ARP) funds. These federal dollars were specifically intended to help the state begin reversing the harms of the pandemic and promote an equitable economic recovery, especially for low-income residents and working-class families.

Roughly $2 billion in ARP funds were allocated as a part of the new spending plan, meaning these funds were similarly negotiated behind closed doors without an opportunity for public input. New investments funded by ARP dollars that will help working families and historically disinvested communities include:

  • $300 million for water infrastructure
  • $170 million for home lead paint remediation
  • $120 million for universal preschool facilities
  • $48 million for subsidized child care payments

 

But almost none of these federal dollars went directly to residents harmed by the pandemic or essential workers who risked their health and well-being so others could safely social distance at home. Hazard pay for essential workers, continued rental assistance, and replenishment of the Excluded New Jerseyans Fund were all left out in favor of blank checks to capital improvement projects. Granted, a large segment of these projects involve health care facilities and services, including mental health and emergency departments. But hundreds of millions of dollars in federal aid went to projects outside the scope of how the Biden administration recommended using the funds. Alarmingly, some ARP funds went towards programs that should be funded by state dollars, calling into question whether lawmakers have a plan on how best to  sustain these investments once federal funds dry up.

Investments

Fiscal Health

Pension

For the second year in a row, state lawmakers committed to making a full payment into the state’s pension fund, shoring up the retirement security of roughly 800,000 current and retired state workers. This is the first time in two decades that the state has made back-to-back payments in their entirety, helping correct decades of skipped or shorted payments into the fund. That winning streak is also a sign of fiscal responsibility to credit rating agencies, which should help improve New Jersey’s credit rating and bring down future borrowing costs.

Rainy Day Fund

The final spending plan includes a $6.78 billion surplus, representing a whopping 20 percent of the state’s general fund. This surplus is three times the size of what it was originally estimated to be. Yet, lawmakers opted against using any of this robust buffer to replenish the state’s empty rainy day fund, making this the third year in a row without a deposit. A healthy rainy day fund enables the state to meet increased demand for essential state services during tough economic times or unexpected events like a severe storm or public health emergency. When the state was faced with drastic shortfalls at the start of the pandemic, the rainy day fund, though small, helped the state avoid harmful cuts. New Jersey already went through a shameful period when the fund was left empty for 11 straight years and simply cannot afford to repeat mistakes of the past. A deposit of $500 million, for example, would be enough to protect vital support and services in unforeseen circumstances while still leaving billions of dollars in leftover surplus.

Economic Security

ANCHOR

Touted as the largest tax relief program in New Jersey history, Governor Murphy’s ANCHOR program will send $2 billion worth of property tax rebates to homeowners and renters alike. The program, which is twice the size of the original proposal, will provide renters with much-needed $450 tax credits to meet skyrocketing rents. The bulk of the tax credits will go to homeowners, however, including nearly $300 million worth of $1,000 payments going to high-earning homeowners.

Child Tax Credit

For the first time, New Jersey will have a state-level Child Tax Credit to help families meet the high cost of raising kids. Modeled on the widely successful federal Child Tax Credit expansion, the program will provide a $500 tax credit to families with kids under age 6. These credits, available to households earning $80,000 or less, are fully refundable and will benefit 374,000 New Jersey children, according to the Office of Legislative Services. This is a big win for working families, providing them with a critical lifeline for basic needs like food, housing, child care, and more.

Expanded School Meals

No child should go hungry in school, and a new expansion of free school meals to all children under 200% of the federal poverty level will help bring the state closer to that reality. With the federal extension of school meal waivers in jeopardy, this state-level change protects New Jersey’s children and their development.

Health Care

Reproductive Health Care

With the recent Supreme Court decision overturning the right to abortion established through Roe v. Wade, more state action is vital to both protect and expand access to reproductive health care. The new state budget takes important steps in this direction with a significant boost in funding for family planning services and new funding for family planning facility upgrades. Lawmakers also approved funding to train new abortion providers and grants to beef up security against anti-abortion extremists, high-priority measures to prepare the state for a post-Roe reality.

Universal Newborn Home Nurse Visitation

For people who recently gave birth, consistent, easy-to-access health care support is essential to a healthy recovery. As part of the Nurture NJ campaign to address disparities in maternal and infant mortality rates, the budget allocates $17 million ​​to a new Universal Newborn Home Nurse Visitation Program to make sure everyone has access to this care. ARP funds cover $6 million of the program’s funding, however, raising concern that this funding provides only a temporary level of support.

Cover All Kids

All New Jersey children, regardless of income, race, or immigration status, deserve access to affordable, high-quality health care. This budget continues the state’s investment in the Cover All Kids initiative, aimed at making sure all children in the state have health insurance, by including $11 million to implement Phase II of the initiative. Specifically, this funding will expand NJ FamilyCare options to all income-eligible children, regardless of immigration status.

Increased Marketplace Subsidies and Plans for Medicaid Disenrollment

During the COVID-19 pandemic, increased federal subsidies for plans on GetCovered NJ and a pause on Medicaid disenrollment from Medicaid have helped to get and keep more New Jerseyans insured. The new budget anticipates the end of the federal public health emergency by increasing the funding available in the Health Insurance Affordability Fund to $168 million. These funds will be used for continued state subsidies on GetCovered NJ and for helping people who are moved off of Medicaid plans to afford plans on the state marketplace.

Harm Reduction Services

Harm reduction services play a vital role in serving people who use drugs and providing them with the private and dignified health care they deserve. This budget continues the state’s improving commitment to harm reduction services, with $4.5 million — a small increase over last year’s budget — committed to helping expand services. With a new state law in effect, allowing centers to open without municipal approval, these funds will go a long way towards bringing harm reduction services to residents who previously lacked access to this life-saving care.

Criminal and Legal Systems

Violence Interruption Programs

Community-based violence interruption programs promote public safety and improve community trust. Like last year, this budget invests $10 million in community-based services which, with inflation, is essentially a cut in funding. The continued support for these programs is essential to building stronger, more resilient communities. Larger investments in these programs and other alternatives that do not center policing will be required to keep communities safe.

Reentry Services

People returning from incarceration should be met with support, understanding, and all the tools they will need to thrive. With newly allocated funds, the Department of Community Affairs will spend a total of $30.7 million on reentry services, which is more or less flat funding from the year before. Given high inflation rates right now, this translates into a spending cut. Funding for reentry services in New Jersey has been historically inadequate, and all communities benefit when previously incarcerated people return home with the resources they need.

Mental Health Crisis Hotline

Moving away from police-centered crisis response is a vital step toward safer communities, especially for calls that police are not trained to deal with. The budget sets aside $16 million for the implementation of the federal 9-8-8 hotline to serve as an alternative to 9-1-1 in the event of a mental health crisis.

Transit and Environment

Liberty State Park

Liberty State Park is a crown jewel of the state park system, providing public access to green space in one of the state’s densest cities and sanctuary to endangered shorebirds and other species. The new budget authorized $50 million in federal funds for park improvements, which are sorely needed. The legislation, however, failed to protect the park from large-scale commercialization and private development. By ceding the decision to preserve Caven Point to the Department of Environmental Protection, lawmakers chose to gloss over this public good. The Legislature did, however, amend the bill to increase public participation in deciding how the improvement funds will be spent, and removed a mandate for the park improvements to generate revenue.

NJ Transit

Safe and reliable public transportation is essential to making New Jersey more equitable and meeting the state’s clean energy goals, and yet this budget once again punts on identifying a dedicated funding source for the state’s mass transit system. NJ Transit’s budget includes up to $746 million from the New Jersey Turnpike Authority and $82.1 million from the Clean Energy Fund, a fund that is meant to offer financial incentives, programs, and services to help families and businesses alike save energy, money, and the environment. While the budget includes language that directs revenue from the Clean Energy Fund for clean energy and bus electrification, there is no guarantee it will be. In the short term, the state can only rely on federal relief funds and federal infrastructure dollars that will run out within the next few years.

What’s Missing

Hazard Pay

Hundreds of thousands of low-paid essential workers put their lives — and the lives of their families — at risk during the height of the pandemic. Despite public praise and many promises of support, the state has yet to dedicate hazard pay dollars for those who risked their health so others could stay home and socially distance. With billions of federal dollars at its disposal for hazard pay for its dedicated essential workers, the state has turned a blind eye to their contributions once again.

Excluded New Jerseyans Fund

The Excluded New Jerseyans Fund, which has distributed more than $30 million to about 13,000 residents excluded from federal pandemic relief, has been a lifeline to many immigrant households. However, many immigrant families have received little to no pandemic aid, despite an abundance of data showing that immigrant communities suffered disproportionately from COVID-19. Expanding the fund would have helped correct pandemic-exacerbated inequities. A planned one-time $53 million payment to immigrant taxpayers is not enough to offset the over $1 billion these households have been denied.

Earned Income Tax Credit (EITC) Expansion

Immigrants contribute hundreds of millions of dollars in state tax collections every year, but they are ineligible for many of the programs they help pay for, including the Earned Income Tax Credit (EITC). The EITC rewards hard-working, low-paid taxpayers by giving them money back to supplement their wages. While other states like Colorado, Maryland, and Washington have expanded EITC eligibility to all taxpayers, regardless of their immigration status, New Jersey chose not to include immigrant workers in this powerful anti-poverty program.

WorkFirst New Jersey Reforms

Somehow, in a year focused on affordability, lawmakers managed to ignore the most important program for very-low-income New Jerseyans: WorkFirst New Jersey. A proposed benefit increase and other eligibility reforms would have helped families in poverty keep a roof over their heads and food on the table, but state lawmakers once again left families living in deep poverty behind. New Jersey will never be affordable for all if those with the lowest incomes — those who struggle with affordability the most — are not prioritized in the state budget.

New Jersey Should Join Other States and Create a Child Tax Credit

Posted on by Peter Chen

Child Tax Credits give households money back on their tax returns to cover the high cost of raising kids and make life more affordable for families, as NJPP’s report on a state Child Tax Credit in New Jersey shows.

So far in the 2022 budget cycle, Connecticut, New Mexico, and Vermont have created new Child Tax Credits, while states such as California, Massachusetts, New York have either expanded or proposed expansions to existing programs.

Although each program is slightly different, all use the state tax code to directly put money straight back in qualifying families’ pockets simply for having a dependent child in the appropriate age range. This series of changes point to a national movement to use budget surpluses to support families with kids and make parenting more affordable.

Refundable child tax credits have the power to: help families afford basic needs like food, housing, and utilities; promote kids’ healthy development; put money back directly into local economies.

A new proposal in the New Jersey Legislature (S-2523/A-3852) would create a state Child Tax Credit along these lines, providing families with a tax credit worth up to $500 for each child under age six for households earning up to $80,000 in income.

With the successful federal expanded Child Tax Credit now expired and any extension still in limbo, it will fall on states to rebuild the lifeline that helped so many families over the past year. New Jersey should invest its budget windfall in the families and children who represent the future of the state.

New Jersey Could Do More to Expand Reentry Services

Posted on by Marleina Ubel

Public safety demands more than policing and prisons, including robust reentry services that support people returning home from incarceration. Reentry services are proven to reduce recidivism, improve neighborhood safety, and save the state money.[i] Without them, returning community members face unemployment, limited housing options and educational opportunities, and disconnection from society. Instead of building a holistic support system, however, Governor Murphy’s budget proposal for Fiscal Year (FY) 2023 continues a path of flat-funding for a patchwork of reentry programs, while law enforcement budgets receive millions in increased investment.

Due to the lack of reentry infrastructure, people leaving incarceration are released with little more than letters from friends, and without any support or even identification.[ii] The state largely relies on non-profit organizations for reentry, which the budget funds through the Department of Community Affairs. Thus, unless an individual is placed on parole, few services are available aside from those provided through non-profit organizations.[iii]  Given that New Jersey has the highest Black-white disparity in incarceration in the country,[iv] the lack of a holistic reentry system is not just a humanitarian issue, but also an issue of racial justice.

The governor’s proposed budget for FY 2023 leaves reentry largely unchanged from the previous year. The budget adds $4 million to the New Jersey Locally Empowered, Accountable, and Determined (NJ LEAD) grants program, which provides funding to local non-profit organizations to enhance or expand services to people leaving prison.[v] The state also plans to use cannabis revenue for reentry, though it is unclear how much will actually be allocated for this purpose.

At the same time, the governor’s budget proposes $10 million in cuts to programs through the Department of Community Affairs. The result is flat or decreased funding for New Jersey’s reentry programs.  Given the state’s record-setting, multi-billion-dollar surplus, this is a big opportunity missed to support residents returning from incarceration.

New Jersey’s budget proposal fails to invest in robust reentry services, non-police crisis response, or directly in communities most harmed by the pandemic. When this is taken into account with the announcement that millions of federal American Rescue Plan dollars would be used to fund state police, it illustrates New Jersey’s single-minded approach to public safety and an equitable pandemic recovery.[vi]

People returning from incarceration need support to thrive in their communities. The state should take a proactive approach to ensure that those reentering their communities have what they need to thrive, rather than depending on smaller non-profit organizations to pick up the slack.  

End Notes

[i] Urban Institute, John Roman et al. “Impact and CostBenefit Analysis of the Maryland Reentry Partnership Initiative” January, 2007. https://www.urban.org/sites/default/files/publication/46196/311421-Impact-and-Cost-Benefit-Analysis-of-the-Maryland-Reentry-Partnership-Initiative.PDF

[ii] New Jersey Monitor, Sophie Nieto-Munoz. “Early release for hundreds of ex-offenders across N.J.” February 11, 2022. https://newjerseymonitor.com/2022/02/11/early-release-for-hundreds-of-ex-offenders-across-n-j/

[iii] New York Times, Tracey Tully. “2,258 N.J. Prisoners Will Be Released in a Single Day,” November, 9 2020. https://www.nytimes.com/2020/11/04/nyregion/nj-prisoner-release-covid.html

[iv] The Sentencing Project, Ashley Nellis, PhD. “The Color of Justice,” Pg. 21. 2021. https://www.sentencingproject.org/wp-content/uploads/2016/06/The-Color-of-Justice-Racial-and-Ethnic-Disparity-in-State-Prisons.pdf

[v] New Jersey Office of Management and Budget. Summary of Governor’s Budget Recommendations: State of New Jersey FY2023 Budget in Brief, Pg. 42. March 8, 2022. https://www.nj.gov/treasury/omb/publications/23bib/BIB.pdf

[vi] New Jersey Monitor, Dana DiFilippo. “In reversal, New Jersey to again allow cops to chase car thieves,” February 11, 2022. https://newjerseymonitor.com/2022/04/29/n-j-reverses-policy-that-barred-cops-from-pursuing-stolen-vehicles/

It’s Still Time for All Kids Coverage

Posted on by Brittany Holom-Trundy

In 2021, Governor Murphy announced the Cover All Kids initiative, a set of policies and actions aiming to ensure universal health insurance coverage for all New Jerseyans 18 years old and younger. Now, a year later and with budget season underway, lawmakers and advocates must act to make sure the next steps of this initiative are prioritized and fully implemented.

To achieve universal coverage, leaders must identify and actively address all current barriers to health care. At the beginning of the initiative, more than 80,000 New Jersey children remained uninsured. For these children, the main obstacles to coverage included difficulties with the enrollment process, coverage eligibility, and affordability of existing coverage options.

In FY 2022, the Department of Human Services focused on reducing obstacles for the estimated 53,000 uninsured children who were already eligible for coverage through NJ FamilyCare (New Jersey’s program for Medicaid and the Children’s Health Insurance Program, or CHIP), but were not enrolled because of the costs of CHIP premiums, a 90-day waiting period for children who were voluntarily removed from employer insurance, or because their families were unaware they were eligible.

These efforts have been successful so far, with an additional 26,000 New Jerseyans under the age of 21 enrolled in NJ FamilyCare since last June. Yet there are still tens of thousands of children still awaiting affordable coverage options, including undocumented children who are currently ineligible for coverage through both NJ FamilyCare and GetCovered NJ (New Jersey’s health insurance marketplace), children whose families are eligible for private health coverage but cannot afford the premiums, and children who face both of these obstacles.

With so many children still facing significant obstacles to coverage, state lawmakers must prioritize funding and implementation for the initiative’s next steps. Governor Murphy’s FY 2023 budget proposes $11 million in funding to expand NJ FamilyCare eligibility to an estimated 16,000 children who are ineligible for NJ FamilyCare due to immigration restrictions, starting January 1, 2023.

This funding promotes a promising investment in children’s health, yet more can still be done to lower barriers to care. With an estimated 36,000 children waiting for affordable health insurance options, the state must prioritize sufficient funding and urgent implementation of the Cover All Kids initiative so all kids have the affordable, high-quality health care they deserve.

May Day: Excessive CEO Pay Stifles Workers’ Wages

Posted on by Nicole Rodriguez

May 1 is International Workers’ Day when the historic struggles and gains made by workers are celebrated around the world. In New Jersey, we acknowledge the work of dedicated organizers and advocates who led the way to a higher minimum wage, a more robust paid family and medical leave program, an emergency fund for workers excluded from federal stimulus relief, and so much more. These important victories helped make New Jersey more affordable for working people and their families in every corner of the state.

As we look to further build worker power — and an economy that works for everyone — we cannot ignore the widening disparity between the most well-off and everyone else. That means examining the growing earning power, and plain old power, of highly profitable corporations and the executives running them.

Far too often, corporate CEOs exert their influence to hoard pay that could have gone to the very people whose labor made the company’s success possible. This shortsighted practice further drives income inequality.

In 2020, New Jersey was home to 12 of the top 350 publicly traded companies. For these companies, CEO pay far outpaced the pay of the average worker. For example, the Quest Diagnostics CEO made 485 times as much as the typical worker in Quest’s industry. Nationally, trends are similar: CEOs were paid on average 351 times the typical worker in 2020.

The large disparity between CEO pay and the average worker is relatively new. In 1965, CEOs of major U.S. companies only earned 21 times more than the average worker. This ratio spiked in the 1990s, hitting a peak in 2000 during a red-hot stock market. Though the current CEO-to-worker compensation ratio remains slightly below the peak seen two decades ago, it is far higher than it was throughout the latter half of the 20th century.

This wage gap will likely continue to widen as U.S. corporations reap record-breaking profits during the pandemic and recession, even with rising costs of inflation. All the while, many workers continue to struggle to make ends meet.

As we thank workers today, we should recognize that our entire state has benefited from their sacrifices and that corporations’ success ultimately depends on their workers.

Tracking How New Jersey is Spending American Rescue Plan Funds

Posted on by Sheila Reynertson

Signed into law in March 2021, the American Rescue Plan (ARP) provided billions of dollars in flexible funding for states and local governments to begin reversing the harms done by the pandemic and promote an equitable economic recovery. Used correctly, these funds offer the once-in-a-lifetime opportunity to advance racial equity by investing in Black and Hispanic/Latinx communities that were hardest hit by the pandemic.

In its official guidance to states, the U.S. Treasury explicitly encourages using flexible funding to “foster a strong, inclusive, and equitable recovery, especially with long-term benefits for health and economic outcomes” in mind.[i] Rather than a scattershot approach, New Jersey’s plans for these unprecedented federal dollars should focus on supporting low-paid workers, their families, and communities who need the most help. This analysis explores the extent to which allocations made so far have targeted these communities and suggests ways that New Jersey lawmakers can meaningfully advance equity with the remaining $3 billion in federal funds.

Coronavirus State and Local Fiscal Recovery Funds

Coronavirus State and Local Fiscal Recovery Funds (FRF) can be used to reimburse states and localities for pandemic-related costs and to support families and communities most harmed by the pandemic. New Jersey state government received $6.2 billion in flexible aid; counties and municipalities received an additional $3.6 billion.[ii]

The Biden administration strongly suggests that state and local governments use federal relief to bolster public health, promote economic security, fund services for disproportionately harmed communities, invest in infrastructure, and provide essential workers with hazard pay.[iii] On the flip side, funds cannot be used to pay off debt or shore up a rainy day fund or other financial reserves. Nor can they fund public-worker pension payments or offset revenue losses caused by new tax cuts. States must allocate all funding by the end of 2024 and have until the end of 2026 to spend it.

The good news is that roughly half of New Jerseys $6.2 billion in flexible funds have been allocated so far, helping renters, public hospitals, small businesses, and child care providers, among others in need.[iv] New Jersey’s allocation rate is in line with other states.[v]

The Majority of Allocated Flexible Funds Await Distribution

The bad news is that less than 5 percent of the allocated FRF dollars have actually gotten into the hands of the designated recipients.[vi] Until new programs get off the ground or existing programs use up other federal funds first, the money remains with the state Treasury. A similar lag occurred last year with the Coronavirus Relief Funds established under the CARES Act.[vii]

Tracking How New Jersey Has Spent Federal Pandemic Relief

The pandemic and resulting economic fallout has disproportionately harmed Black and Latinx/Hispanic communities — a harsh reflection of longstanding inequities in education, employment, housing, and health care driven by our nation’s legacy of slavery and systemic racism. The most effective way to advance equity is to target aid to these communities and begin reversing racial and ethnic disparities exacerbated by past policy choices.

But do the first rounds of emergency funding achieve this? Looking at these FRF allocations by specific sectors and affected communities identified by the Biden administration may offer some answers.

Services for Disproportionately Harmed Communities 

Since receiving FRF dollars in May 2021, New Jersey has allocated $700 million to services for families and communities disproportionately harmed by the pandemic due to pre-existing health and economic disparities. . Special education received the bulk of funds in this category, with smaller investments steered to food assistance, lead hazard removal, and direct assistance for workers excluded from other relief programs. So much more could be done to provide assistance to these households and communities. Recommended projects that would directly respond to disproportionate impacts of the pandemic include re-employment training, vacant or abandoned property remediation, and services to address educational disparities and students’ social, emotional, and mental health needs.

Economic Harm from the Pandemic

State lawmakers have allocated $1.3 billion to address economic harm from the pandemic. Allocations made under this category may be used to assist struggling households, small businesses, and nonprofits, or to aid especially hard-hit industries such as tourism, travel, and hospitality.

The largest allocation so far, rental and utilities assistance, hits the mark as appropriately targeted to helping those who need the most help, as does support for affected businesses. But it’s questionable if aid for such projects as dredging the Woodbridge municipal marina or building a new visitor center at Great Falls — has any beneficial effect on low-income, Black, Hispanic/Latinx, or other disproportionately-affected communities.

A lack of intention or inadequate analysis of health or economic equity results in unclear benefits for certain programs. For example, “Return and Earn,” a subsidized job program covering the costs of wages paired with cash incentives, aims to help small businesses and workers get back on track, but it’s unclear whether these businesses and workers are focused on hardest-hit communities. Using FRF for services unrelated to pandemic recovery ignores the needs of households facing immediate hardships and neglects the opportunity these dollars present to address structural inequalities.

Premium Pay for Essential Workers

Premium pay, also known as hazard pay, is designed to compensate essential workers who faced — and continue to face — heightened risks and additional burdens during the pandemic. Many of these workers earn lower wages on average and are disproportionately Black and Hispanic/Latinx.[viii]

New Jersey has yet to recognize the enormous risk workers in health care, food service, education, and logistics were exposed to during the shutdown.[ix] These essential workers deserve fair compensation, yet they continue to be overlooked in federal relief and recovery legislation. Directing premium pay to those with limited income and those who often went without basic health and safety protections would make an immediate difference to these workers. One potential formula calls for up to 160 hours of hazard pay at $13 per hour for health care workers and up to 80 hours of hazard pay at $13 per hour for other essential workers.

How New Jersey Can Advance Equity with Remaining Federal Funds

New Jersey’s distribution of the remaining $3 billion in recovery funds must pivot to a strategy that advances racial, ethnic, and gender equity. That means prioritizing more financial support for working people paid too little to make ends meet, Black and Latinx/Hispanic residents, and immigrants. These are the households that suffered — and continue to suffer — harshly disproportionate economic and health consequences of the pandemic. It also means strengthening infrastructure in communities that have long suffered from underinvestment. Failing to use federal money to serve these purposes would be a lost opportunity to create a more equitable New Jersey.

 End Notes

[i] SFRF Interim Final Rule (IFR) at 31 C.F.R. §35.6 (b) https://www.govinfo.gov/content/pkg/FR-2021-05-17/pdf/2021-10283.pdf

[ii] Cory Booker Press Release, Menendez, Booker Release More Details on How American Rescue Plan will Help NJ, March 2021. https://www.booker.senate.gov/news/press/menendez-booker-release-more-details-on-how-american-rescue-plan-will-help-nj

[iii] SFRF Interim Final Rule (IFR) at 31 C.F.R. §35.6 (b) https://www.govinfo.gov/content/pkg/FR-2021-05-17/pdf/2021-10283.pdf

[iv] New Jersey Governor’s Disaster Recovery Office, Financial Summary by Federal Act, December 2021. https://gdro.nj.gov/tp/en/financial-analysis/financial-summary

; State of New Jersey, 2021 Recovery Plan Performance Report, August 2021. https://home.treasury.gov/system/files/136/New-Jersey_2021-Recovery-Plan_SLT-3280.pdf

[v] Center on Budget and Policy Priorities, How States Can Best Use Federal Fiscal Recovery Funds: Lessons From State Choices So Far, November 2021. https://www.cbpp.org/research/state-budget-and-tax/how-states-can-best-use-federal-fiscal-recovery-funds-lessons-from

[vi] NJPP correspondence with Governor Murphy Senior Staff, January 27, 2022. The Bergen Record, NJ got $6 billion in COVID-19 federal relief. This is how it’s being spent, so far, Sept 2021.  https://www.northjersey.com/story/news/new-jersey/2021/09/13/nj-covid-federal-spending/5782777001/

[vii] Pandemic Response Accountability Committee of the Council of the Inspector Generals on Integrity and Efficiency. https://www.pandemicoversight.gov/track-the-money/funding-charts-graphs/coronavirus-relief-fundOversight

[viii] American Journal of Public Health, Reopening the United States: Black and Hispanic Workers Are Essential and Expendable Again, October 2020. https://ajph.aphapublications.org/doi/10.2105/AJPH.2020.305879

[ix] State of New Jersey, 2021 Recovery Plan Performance Report, August 2021. https://nj.gov/covid19oversight/transparency/reports/docs/20210831FINALNJRecoveryPlan.pdf and New Jersey Department of Treasury, Office of Management and Budget’s Request for State Fiscal Recovery Fund Program Approval by Joint Budget Oversight Committee, November 2021. https://www.senatenj.com/uploads/23NOV2021-ARP-SFRF-Program-Approval-Request-JBOC-Memo-002.pdf

 

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