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Gov. Phil Murphy. (Photo: Kevin Sanders for the New Jersey Globe)

Murphy looking for face-saving options

Fledgling governor needs to show state he’s in charge, not legislative leaders

By Nikita Biryukov, June 27 2018 11:40 am

Gov. Phil Murphy is angling to protect his image if the forward movement to budget negotiations comes to an end before he and legislative leaders can agree on a compromise.

“One side wants to make a historic investment in the middle class, urban communities, working families, to do it in a way that resets tax fairness and asks the wealthiest among us to pay their fair share and close corporate loopholes and undo gimmicks,” Murphy said at a press conference in Newark Wednesday morning.

“The other side is going to stand either on behalf of cutting $800 plus million dollars of desperately needed investments or standing to allow the state to shut down because they’re protecting millionaires.”

Budget negotiations took a positive turn early in the week, with meetings on consecutive days that ended with Murphy releasing a compromise budget deal on Tuesday. Murphy has another meeting with legislators scheduled for Wednesday afternoon.

That deal would include a more modest perpetual increase to the corporate business tax than the one sought by Senate President Steve Sweeney and Assembly Speaker Craig Coughlin, which would make the state’s business tax the highest in the nation for corporations with more than $25 million in gross annual income and would sunset after two years.

Murphy’s deal also seeks a smaller millionaire’s tax than he initially sought – though the administration has not provided figures on how small or large this tax or the corporate business tax could be – and a two-year phase in of a 7% sales tax.

“We didn’t get into levels,” Murphy said “But, it’s a pretty clear discussion as to where we think the common ground can be.”

The angling from Murphy appears to be an attempt to protect himself politically in case he is forced to issue a line-item veto to avoid a government shutdown.

He’d be cutting roughly $855 million in spending from the budget the legislature passed last week, and it’s more than likely some of those cuts would hit progressive priorities important to him and legislative leaders.

The prospect of such a veto, which Murphy promised last week but has not delivered on, appears to be diminishing as lawmakers talks become productive instead of heated.

Still, Murphy said again on Wednesday that all options are on the table, and time is running short. Lawmakers have little more than three days until the budget deadline, but that figure doesn’t worry Murphy.

“If people come with goodwill on all sides, and I have no reason to believe there isn’t, I think we can solve this in 30 minutes,” Murphy said.

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