New Jersey Democratic Gov. Phil Murphy on Tuesday proposed a $48.9 billion budget that boosts K-12 funding by $650 million, makes a full public pension payment for the second straight year, redistributes nearly a $1 billion in property tax relief and raises overall spending by about 5% over last year�s plan.

Murphy unveiled the proposal during a speech in the Assembly chamber, the first time since 2020 and the COVID-19 outbreak.

New Jersey�s rosy finances stem from better than expected sales and income tax collections and from climbing economic output, with the state�s gross domestic product rate outpacing the nation�s and neighboring states, according to the state treasurer�s office and federal data.

Murphy, a former Goldman Sachs executive, has pitched himself to voters as the person to get the state�s financial house in order after two terms of Republican Chris Christie. Murphy�s prioritized making good on the state�s public pension payments, which for the second straight year would amount to a roughly $6.9 billion payment. He�s also nearly all the way to fully funding K-12 education according to the state formula that Christie did not abide by. His office estimates that fully funding could be achieved in two years.

He�s also grown the size of the state budget, which is up more than $14 billion from the plan enacted by Christie during his final year in office.

While the latest proposal hikes no new taxes, Murphy and the Democrat-led Legislature increased income taxes on people making over $1 million year as well as on businesses earlier in his first term.

Murphy promised no new taxes in his second term, which began in January. He�s also spotlighted affordability as a top issue � augmenting his longtime slogan about making New Jersey stronger and fairer to say he wants to make it �stronger, fairer, more affordable.�

Part of that, Murphy said, is tackling the state�s sky-high property taxes, which average about $9,300 a year.

He proposed overhauling a property tax rebate program to allow for homeowners making up to $250,000 to get a credit toward their property taxes of up to $700 in the fiscal year beginning July 1.

For the first time, he also wants to include renters. Those making up to $100,000 would get rebate checks � since they don�t pay property taxes directly � of up to $250.

Overall the governor�s proposal could benefit 1.8 million residents, up from the 470,000 who currently get the property tax assistance.

His budget also proposes a one-year fee waiver for marriage licenses and for renewals of certain health care licenses. Residents could get into state parks fee-free under his plan.

The budget sets aside some $9.92 billion for K-12 aid, up from $9.27 billion and about $2 billion more than where funding stood shortly before Murphy took over as governor.

The spending plan would keep New Jersey Transit fares flat, meaning no hike for a fifth straight year.

The state constitution requires a balanced budget to be enacted annually, with a deadline of June 30. Lawmakers will have a say over the next few months as they conduct hearings and decide what they�ll keep and what they�ll jettison from the governor�s proposal.

Republicans, who are in the minority, have already panned Murphy�s penchant for increased spending, calling for local government cuts as a way to reduce property taxes in response to his rebate program.

Despite those concerns, Murphy�s stewardship has appealed in part to one credit rating agency, with Moody�s boosting the state�s rating and citing �continuing trends of strong revenue and liquidity and its steps to more aggressively address liability burdens.�

Murphy�s proposal also calls for maintaining a $4.2 billion surplus and putting $1.3 billion into a fund for the current fiscal year to pay down debt.

(AP)