Tonight, we continue with the second piece of our reporting in our new digital series called The Change Project, which focuses on possible answers to some of New Jersey's most pressing problems.

This time we look at the state budget and whether the process of crafting such a massive spending plan can be improved.

I recently spoke with our budget and finance writer John Reitmeyer about what he found.

John Reitmeyer.

Always good to talk to you.

This project and the way you tackled it, looking at the budget, which is something that is so complex constitutionally, has to be balanced, but there's so much more to it than just balancing the budget.

What did you focus on?

Yeah.

Thank you for having me and to talk about this.

So sometimes these concepts you know, public finance, it can be esoteric.

And so what I wanted to look at was how New Jersey, with its budget, over $55 billion, prepares for the type of economic downturns that during the course of my career covering state government for more than 20 years, I get to see the ups and downs of the budget cycles and the consequences of that.

And I really wanted to put a focus on how these and how these types of things can impact everyday new Jerseyans, New Jerseyans struggling with things like inflation and property taxes and how some of the decisions that get made in Trenton today or over the next few months could have an impact on their everyday lives going forward.

Specifically when we see revenue losses.

So when we think about events like the Great Recession 2007 to 2009, the aftermath of that, when we think about the downturn that happened during that first year of the COVID 19 pandemic, the way that hits the budget is it those types of events usually cause revenue losses.

And then that revenue losses equate to a stop in some way, shape or form in state spending?

Absolutely.

And that's what we that's what I've seen happen over my career.

And that's what usually happens.

You know, we we can look at studies that have been done across the country and our other states have seen the same types of effects.

And so then the next step is these have an impact on everyday residents.

One good example is during the 2020 revenue losses from COVID 19, we saw property tax benefits for seniors and low income homeowner homeowners.

Put aside.

The funding was what they called appropriated to make sure that the budget stayed in balance.

The state also borrowed money that year, and taxpayers are paying off that that borrowing for.

Quite a few more years.

Actually with interest.

Yeah.

So these are things that maybe when you see on paper as a taxpayer, as someone who's consuming the state budget strictly from that point of view, may not seem tangible like they affect you, but they do.

In fact affect your bottom line.

And that's the goal of the reporting, is to to make that connection and to bring that home.

You can never predict when a recession is going to hit and how deep those revenue losses will be.

But there are some best practices that have been researched, that have shown states have been able to improve their resiliency by following some of these practices.

Why is that so important?

Because when we talk about the state having a big surplus or seeing years where the revenue collections are higher, and yet we're always focused on these downturns.

Yeah.

Again, just speaking from my experience during the downturns, you're sort of in an all hands on deck triage mode.

It's when you're not in the downturn.

Right now, we're not in a bad situation economically.

In New Jersey, revenue collections are a little soft compared to where they were a year ago, but still relatively high historically.

So this is the time generally when policymakers should be considering things that make the state and the budget itself more resilient, because we're not in that mode right now.

We're reacting to a downturn when you're really using all your bandwidth to just you know, keep the lights on and respond, whereas now maybe we can be a little bit more thoughtful and take on some of these more challenging issues with that convenience of not being right in the thick of it.

Are those issues fixable?

Which I know, of course, is is the big question.

Yeah, I think my role as a journalist, I don't want to say do X or do Y or Z, but I think what we can do is show where other places who have had the same types of challenges and how they've gotten through them successfully.

And again, there's really good research that's done by public finance experts in this country.

We're lucky to have some good ones who can shine a light on some of the ways, like a state, like North Carolina or New Mexico has come out on the other end.

And some of the things that they've done to be able to do so.

John Reitmeyer.

You can check out his full change project on our website.

Thanks so much, John.

You're welcome.