By Dari Kotzker
NJ Today
Trenton officials argued whether the glass is half empty or half full. Full, according to the latest revenue numbers from the Department of Treasury, which touted its $143 million ahead of revised projections. Half empty says an Office of Legislative Services report, which warned the state could finish the fiscal year 2013 $150 million in the hole. Who’s right? Former New Jersey Rreasurer David Rousseau says it’s about techniques. The Treasurer’s Office develops monthly targets while the OLS focuses more on growth rates to date.
“It appears here there may be some confusion on corporate business tax,” said Rousseau, the budget and tax analyst for New Jersey Policy Perspective. “There are parts of the corporate tax that need to be shifted to the income tax later on, and that could be why right now the administration is showing the corporate tax being better than it is because they haven’t accounted for the adjustment they’re gonna make at a later date.”
The Treasurer’s Office says revenue collections through June totaled $25.6 billion, which is 6.6 percent more than in fiscal year 2012. OLS reports the revenues are still behind the 7.2 percent growth rate needed to hit the Christie administration’s revised year-end targets.
“Six-tenths of a percent on about $25 billion in revenue is equal to $150 million, which may not seem a lot, but it’s actually half of the surplus that they have going into for next budget,” Rousseau said.
Department of Treasury Spokesman Bill Quinn says, “While the final July accounting adjustments for the fiscal year still have to be made, we remain comfortable with our revenue projections.”
Some Democrats are concerned with the disparity between the two reports.
“Right now, it’s hard to know what to believe, but certainly the OLS has made a convincing case that the administration is once again, not coming up with the right revenue numbers. That seems to have happened in past years and I believe it is happening again,” said Democratic Sen. Linda Greenstein.
Republican Assemblyman Declan O’Scanlon said in a statement that “Today’s stellar economic numbers bear out the wisdom of the conservative fiscal policies we’ve implemented under this administration… The continued good news about revenues and jobs demonstrates we have every reason to maintain our optimism.”
The different financial outlooks between the Treasurer’s Office and OLS is not unusual.
“There’s always differences between OLS and administration, however when you’re coming to deal with the fiscal year that was finished or about to be finished, the difference usually isn’t this large. Because they’re looking at revenue, they’re not looking at projecting revenue 14 or 15 months in advance, they’re looking at projecting revenue for just two more months,” Rousseau said.
Rousseau says the real numbers for the major taxes should be available in an OLS report in September. It will include all the accounting adjustments and attribute revenues back to July of last year.