Legislation sponsored by Assemblyman Roy Freiman (D-Hillsborough) seeks to appropriate $3.7 billion to pay off some of the state’s debt rather than spend it.
Freiman’s “New Jersey Debt Defeasance and Prevention Fund” would finance a settlement of state debt, including some bonds, and put some capital projects on a pay-as-you-go basis instead of creating more debt.
“We have bonded debt that is virtually the same as our state budget,” Freiman said. “It is so much easier to spend money rather than pay off debt.”
The bill introduced by Freiman would spend $2.5 billion to retire and abate state debt and another $1.2 billion for capital project funding.
Freiman wants the state to take advantage of its improved fiscal outlook – revenues were better than expected at the close of the fiscal year, leaving New Jersey with a $6 billion surplus – by painting down what he described as expensive “credit card debt.”
“It’s the fiscally responsible thing to do,” said Freiman.
The bill is under consideration by the Assembly Budget Committee and is on the agenda for today.