Amends Constitution to limit use of nonrecurring revenue in State budget except in certain times of crisis and limits State budget growth.
This amendment seeks to limit the growth of the state budget by capping any increases to no more than the growth in the Consumer Price Index (CPI) during the same period. This stipulation aims to ensure that budgetary growth remains tied to the economic realities of the state, thereby providing a more sustainable fiscal pathway. Additionally, any recurring revenues that remain unspent by the end of a fiscal period are mandated to be deposited into the Surplus Revenue Fund, often referred to as the 'rainy day fund.' This can help the state build a financial cushion against future economic uncertainties.
SCR71 is a proposed constitutional amendment aimed at reforming the budgetary practices of the State of New Jersey by ensuring that the state budget is balanced using only recurring revenues. The proposal explicitly prohibits the use of one-time or nonrecurring revenues for maintaining budget equilibrium, except during times of emergency, which can be overridden by a two-thirds vote in the Legislature. This is designed to foster greater fiscal responsibility and long-term financial health for the state by preventing short-sighted budgeting practices.
There are potential points of contention surrounding SCR71. Critics may argue that the restrictions on using nonrecurring revenues could limit flexibility in times of fiscal crisis, potentially hampering the state’s ability to respond effectively to unanticipated needs. Proponents, on the other hand, assert that this measure is essential for preventing fiscal irresponsibility and the harm caused by relying on temporary funding sources. The debate primarily centers on balancing immediate fiscal needs against the long-term financial health of the state.