Rating analysts will watch how New Jersey tackles an estimated $8 billion deficit for fiscal 2011 after the state’s Office of Legislative Services released the anticipated budget shortfall on Tuesday.

New Jersey has some time to address the issue as its fiscal 2011 begins July 1, 2010. The OLS expects a modest base revenue growth of approximately $800 million next year. Conversely, immediate and future retirement costs, non-recurring funds from the American Recovery and Reinvestment Act, and the end of a one-time income tax hike, among other factors, may add up to a $8 billion funding gap, according to the report.

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