Senate Republican Leader Tom Kean today called on Governor Jon Corzine to immediately impound all unspent funds. This year’s budget is running almost $1 billion behind in anticipated revenues. A projection by the nonpartisan Office of Legislative Services (OLS) estimates the structural budget deficit for FY 2011 to be almost $10 billion. Impounding funds is using legal authority to set aside appropriated monies.
“It is vitally important that the Corzine Administration ensures that a portion of unspent funds are immediately impounded. Revenue collections for the current budget are running more than $1 billion behind, in the current fiscal year.
“This year’s state budget deficit will impact next year’s budget. The estimated magnitude of the structural budget deficit for fiscal Year 2011 is truly staggering. The nonpartisan OLS has estimated the shortfall to be about $8 billion. This figure could rise to $10 billion in a worst-case scenario.
“The call for an outgoing administration to impound unspent monies is not without precedent. Following the gubernatorial election of 2001 the incoming McGreevey Administration asked the outgoing DiFrancesco Administration to freeze unspent funds. Governor DiFrancesco and his team took management actions that saved almost $1.2 billion in revenue.
“One of the actions considered was a directive that all departments identify options to reduce spending by 5 percent. Governor DiFrancesco also directed key personnel to be accessible to the incoming administration during the transition period.
“I would hope that Governor Corzine and his team would take similar actions to ensure that what promises to be a difficult budget season runs as smoothly as possible. In the spirit of bipartisan cooperation the Senate Republican Caucus has identified several areas that could produce significant savings. Some of the suggestions are available at www.senatenj.com.