Senate, Assembly clear borrowing bill

Update: Gov. Phil Murphy signed the borrowing bill into law Thursday afternoon.

Both chambers of the legislature advanced a bill that would allow the state to borrow up to $9.9 billion to plug budget holes created by the COVID-19 crisis Thursday.

The measure passed 22-15 in the State Senate and 46-26 in the Assembly despite staunch Republican opposition.

“We must take action to ensure our fiscal viability by empowering the State to apply for and receive federal stimulus loans for the benefit of the State’s ability to respond to the negative impacts of the coronavirus,” Assembly Budget Chairwoman Eliana Pintor Marin (D-Newark) said. “We do not make this decision lightly. The historic nature of the current pandemic has led to this unprecedented last resort due to the current fiscal crisis.”

Gov. Phil Murphy backed the proposal and is has said he will sign the bill once it reaches his desk.

The bill creates a four-member panel that will have to approve any borrowing authorized under the bill.

“We must keep New Jersey’s economy moving and we have to continue to provide the government services that are so important during the pandemic,” said Senate Budget Chairman Paul Sarlo (D-Woodridge). “While we understand the need for emergent financing to help with the economic recovery, we still have to be responsible with added debt. This is uncharted territory so we have to monitor fiscal conditions as we make decisions on borrowing.”

Republicans have threatened to sue if the bill was signed into law, claiming that borrowing to plug revenue holes, as the measure allows, is unconstitutional.

The party’s lawmakers kept up their opposition on Thursday, with debate on the measure — the bill was the only one up for a vote in either chamber — stretching to more than an hour in the Senate and more than two hours in the Assembly.

“It’s increasingly clear that this borrowing scheme is not about actual fiscal need, it’s about giving Governor Murphy a $10 billion slush fund that our grandchildren will be stuck repaying for a generation,” Pennacchio said.

The bill was also the source of some intra-party squabbling among Democrats.

In both chambers, the majority party voted down amendments put forward by black lawmakers that would have forced legislative leaders to include persons of color on the four-member panel responsible for approving bonds.

The bill also led to some defections.

“Asking New Jersey taxpayers to solely shoulder what equates to a 35-year tax increase without the transparency that accompanies a public referendum is the absolute wrong way to approach this crisis,” State Sen. Dawn Addiego (D-Evesham) said. “We are all in this pandemic together. Solving the budget challenges brought on by it should be no different. This is a pivotal moment that will impact the lives of New Jersey families for generations — they deserve an opportunity to vote on it.”

Addiego defected to the Democratic party in January 2019, but Republicans still hold the eighth legislative district’s two Assembly seats.