Gov. Phil Murphy delivers his second 2021 budget speech Tuesday at SHI Stadium on the Rutgers University campus in Piscataway, starting two hours earlier than first planned at 10 a.m. to get ahead of the midday heat.

But there’s no avoiding how hot things are likely to get at the Statehouse in the five weeks that follow until the 2021 spending plan must be approved – over how much borrowing Murphy proposed, over any tax increases he recommends and over what spending gets included or excluded from his plan.

Ben Dworkin, director of the Rowan Institute for Public Policy & Citizenship, said the backdrop is the greatest financial crisis to challenge the state since the Great Depression.

“And I think what we’re going to be looking at is a pretty intense negotiation over what the priorities are going to be in terms of state spending,” Dworkin said.

Revenues in the current budget appear to be down by less than had been anticipated, less than 1% over the past 13 months, which might make the budget easier to balance than Murphy and the Legislature expected when they approved a law allowing borrowing of up to nearly $10 billion.

“Whether revenues are better or not, we're still solving for an enormous hole,” Murphy said at his Friday news conference. “It's at a minimum of $5 billion in the here and now, and when you aggregate what we already went through in the stub period that we're in and what we expect at least the first half of fiscal 2022 to look like, it's a much bigger number.”

The borrowing law upheld by the Supreme Court as constitutional authorizes borrowing only through June 2021 – up to $2.7 billion in the current budget and $7.2 billion in the proposed budget, but capped at whatever is eventually the certified revenue shortfall.

Murphy said he wants “to use the borrowing authority judiciously,” and Dworkin said tax revenues, federal funds and spending cuts could keep it below the $9.9 billion allowed.

“Just because the courts have granted the state the authority to borrow that much doesn’t mean that anybody really wants to borrow that much,” Dworkin said.

Murphy announced a 2021 budget plan in February, only to see it shelved when the coronavirus pandemic took hold shortly after. A budget year normally begins July 1 and ends June 30, but the 2020 budget was extended three months to allow more time to assess the impacts of the virus and associated economic shutdowns.

The political dynamics around the state’s coronavirus response will change over the next five weeks, Dworkin said, after five months in which Murphy has been governing mostly through executive orders.

“And the idea, the powers bestowed upon a governor to use executive orders were not intended to be used for that long,” Dworkin said.

Dworkin said the Legislature has been cut out of having any real influence on decisions – but that’s about to change.

“The governor’s powers are now suddenly restrained, and I think there’s been pent up frustration on the legislative side to exert its authority and its prerogatives,” he said.

More From Townsquare Media News:

Enter your number to get our free mobile app