Murphy cuts New Jersey school security borrowing proposal

Debt burden cited as Murphy cuts New Jersey school bond request

August 28, 2018, 3:58 p.m. EDT 1 Min Read

New Jersey Gov. Phil Murphy has cut in half an educational bond referendum that state lawmakers had expanded in the wake of the Parkland school massacre in Florida.

Murphy signed legislation Monday to place a $500 million bond proposal on the ballot.

Phil Murphy, governor of New Jersey, speaks during a budget press conference in Newark, New Jersey, U.S., on Wednesday, June 27, 2018. Murphy dangled his compromise budget before supporters in Newark, scoring endorsements from the mayor of New Jersey's largest city and swelling the ranks of Democratic lawmakers breaking from their colleagues' spending plan. Photographer: Alex Flynn/Bloomberg

After the Florida mass shooting, lawmakers had doubled the bond mesure plan to $1 billion to boost school security systems.

Murphy said he cut the bond amount because of the state’s already high debt burden.

“While I certainly endorse the priorities established in this bill, I also believe that their long term fiscal implications must be carefully considered,” said Murphy in a statement. “New Jersey already ranks in the top five states in the nation for tax supported debt.”

Murphy, a Democrat, said New Jersey’s general obligation and state contract bonds currently eclipse $33 billion with the state’s overall debt service costs exceeding $4.1 billion in the 2019 fiscal year that began July 1. He noted that the Office of Legislative Services estimated total debt service payments under the drafted bill ranging between $1.726 billion and $2.168 billion depending on the interest rate and other market factors.

Bill sponsors originally sought a $500 million GO bond proposal aimed solely at boosting vocational-technical school opportunities before deciding to double the measure for school security enhancements after a gunman murdered 17 people at Florida’s Stoneman Douglas High School.

“Gov. Murphy’s massive cut to the school security funding in the original version of our bipartisan legislation is a total lapse in judgment,” said state Sen. Anthony Bucco in a statement. “If the governor is so concerned about keeping our schools safe from gun violence, then I question why he would mandate such a drastic cut in school security.”

New Jersey has GO bond ratings of A3 by Moody’s Investors Service, A-minus by S&P Global Ratings and A by both Fitch Ratings and Kroll Bond Rating Agency. Only Illinois has lower debt ratings among the U.S. states.