Unlike the federal government, New Jersey is barred from operating at a deficit by its state constitution. That effectively forces spending cuts in the event of unanticipated financial downturns. As such, NJ has frozen $920 million in state government spending for the rest of the fiscal year as it grapples with a “significant” slowdown in tax collections in response to COVID-19. The “freeze” doesn’t mean the payments won’t be made – just that that they will be delayed.
The biggest item on the list of reserves is $142 million for the property tax credits paid through the homestead benefit program that were due to be applied to May 1 bills. The state is telling towns it can’t support the credits at this time and will reimburse them if they issue revised tax bills to residents. The Homestead credit is a popular property tax relief program for about 580,000 seniors, disabled or low-income homeowners.
https://nj1015.com/nj-freezes-920m-in-spending-including-property-tax-credits/
**** Separately, NJ extended the state’s fiscal year-end from June 30th to Sept. 30th to give both the state more time to recover financially from the COVID-19-related economic slowdown… and likely further delay the frozen payments.