Last week, Governor Murphy and the Democrat majority in the NJ State Senate and Assembly approved a new law to borrow $9.9 billion during the next 18 months. They plan to use this money to pay all state government employees in full, together with 2% yearly pay hikes and pension credits. They are doing this even though the many of these employees weren’t working or are working part time. This is even because the State doesn’t have the money to pay them because most people who don’t work for the government are earning much less or nothing, and are paying much less in tolls and taxes.
We filed a lawsuit to stop this as soon as the Legislation was first introduced. New Jersey’s State Constitution says the state can’t borrow money unless voters approve. However, there was a six week delay in finalizing the law. The judge dismissed our case because she said we should have waited until the law became final. When the law became final last Thursday, the New Jersey Republican Party filed a lawsuit to stop this. We also re-filed our lawsuit.
Both lawsuits claim that Murphy and the Democrats violated our State Constitution by not submitting his loan package to voters for approval as a Ballot Question in November. Our State Constitution permits borrowing without voter approval “for purposes of war, or to repel invasion, or to suppress insurrection or to meet an emergency caused by disaster or act of God”. Murphy claims this allows him to borrow $9.9 billion without voter approval.
As soon as the Republicans filed their lawsuit in Mercer County, the State Supreme Court took up the case, and set up a hearing for August 5. We then filed a motion to take part in that argument as an “Amicus Curiae” (Friend of the Court). We also filed a brief raising these five issues not mentioned by the Republicans in papers they filed with the court so far:
- The constitutional requirement of voter approval of state government debt is as important today in reducing the risk of systemic corruption and unsustainable state government debt as it was in 1844.
- The “New Jersey COVID-19 Emergency Bond Act” purports to create, without voter approval, the biggest single increase in state government debt in New Jersey history. Unlike other debts incurred without voter approval, repayment of this debt will be secured by a mandatory new state property tax over and above existing county, school, and local property taxes. This new $9.9 billion debt will have the same legal effect as a new first mortgage on every parcel of real estate in New Jersey. This new debt will be added to $235 billion of debts already outstanding last year, which were already unsustainable.
- State officials are “estopped” from claiming a need to borrow $2.7 billion for extended fifteen month extended budget “year” 2020 ending on September 30, 2020. They already certified under oath that the State had more than enough money to operate for the next three months.
- There is no objective evidence that state defendants must spend $9.9 billion “to meet an emergency” prior to the general election of November 3, 2020.
- The “no layoff” memorandum of agreement made between NJ State Government and the Communications Workers of America (CWA) is not enforceable if the state does not have sufficient funds to pay the salaries and other benefits to state employees covered by it.
Clink link below for full 20 page Amicus Curiae brief we filed last Friday 24, with the NJ Supreme Court.
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Seth Grossman, Executive Director