When Gov. Phil Murphy delivers his annual budget address tomorrow, he’ll break new ground as the first governor to deal with structural deficits and possible tax increases while his wife is running for the United States Senate.
As a result, Murphy is expected to avoid potential traps, including any sales tax increase, to protect Tammy Murphy’s bid for the Democratic Senate nomination, several sources with direct knowledge of the governor’s budget plans.
That could delay some budget negotiations until after the June 4 primary election, giving Murphy and legislative leaders a 25-day window at best to pass a budget by June 30 without risking a state government shutdown.
In other words, there could essentially be two budgets: one released tomorrow and a second more serious proposal waiting in the wings until after the Senate primary.
Murphy has not entirely closed the door to a sales tax increase, but that’s off the table for now; those involved in the budget process say the First Lady remains part of the deliberations for now. Still, a hike in the state’s sales tax is a non-starter for key New Jersey Democratic legislative leaders who stopped the governor from considering it; Murphy may readily have come to the same conclusions even if his wife wasn’t running for office.
The path to Tammy Murphy overtaking the current frontrunner in the Senate primary, Rep. Andy Kim (D-Moorestown), could be severely impaired if she’s tied to unpopular budget proposals offered by her husband.
In the meantime, Murphy could propose an increase in the corporate business tax – something that might be less risky to Tammy Murphy’s campaign. He’s also expected to address transportation projects and the Transportation Trust Fund issues.