- Associated Press - Tuesday, May 17, 2016

TRENTON, N.J. (AP) - New Jersey could face a $1.1 billion shortfall for the remainder of the current fiscal year and into 2017, legislative budget forecasters estimated on Tuesday.

The Office of Legislative Services told lawmakers in a memo that revenues for the current fiscal year, which ends June 30, are $486.6 million below what Republican Gov. Chris Christie’s administration projected and $621.6 million for fiscal year 2017.

The gap in the current year’s $33.8 billion budget could mean Christie and the Democrat-led Legislature would have to shave money from some programs or potentially cut the state public pension payment.

Lawmakers are in the midst of considering Christie’s 2017 $34.8 billion budget.

The biggest differences between the governor’s earlier estimates and the new forecasts lie in the income tax projections: For the current fiscal year, forecasters predict $318 million less in revenue than the governor estimated in February, and $584.6 million less than the governor’s mark for fiscal year 2017.

Treasurer Ford Scudder is set to publicly unveil revised estimates Wednesday. Spokesmen for the administration did not immediately return emails seeking comment.

OLS Revenue, Finance and Appropriations section chief Catherine Brennan told lawmakers that forecasters will update their estimates to reflect changes not included in the forecast.

The revised legislative forecasts come after lawmakers and the administration predicted largely similar revenues over the past calendar year, which contrasted with budget gaps in 2014 that resulted in Christie paying less into the pension than called for under a 2011 law that he and Democrats agreed to.

Labor unions and Democrats pressed the case all the way to the state Supreme Court, which handed Christie a victory by ruling last year that lawmakers and the governor would have to work out their differences in the budget process. Democrats then delivered Christie a budget that raised taxes on high-income earners to close the gap. Christie used his line-item veto to take out the tax hikes and restore the pension cuts to balance the budget, which is required constitutionally.

PolitickerNJ.com first reported news of the memo.


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