As reported by NJ.com, a plan offered by Governor Phil Murphy for New Jersey’s state government to make up for massive losses in tax revenue with up to $14 billion in borrowing passed the State Assembly yesterday, but still lacks support from State Senate President Stephen Sweeney. The measure cleared the lower house in a 51-28 vote along party lines.

The State Treasurer has lowered by $10 billion how much tax revenue the State may collect through next summer. The coronavirus pandemic crisis and business closures ordered to slow its spread have spurred an economic crisis that’s slammed state tax collections, including personal income taxes, sales taxes, and taxes on corporate income. Murphy says the State would have to make draconian cuts and “historic” layoffs if the State Legislature does not agree to its borrowing plan and the federal government doesn’t come through with more aid. Under the worst case scenario, Governor Murphy pegs the number of public worker layoffs at 200,000.

“It’s a huge step forward,” Murphy said of the Assembly vote. “Bonding is not something we all wake up reflexively wanting to do. But the alternative is devastation for our front-line workers, the very people we need at their positions and posts…health care workers to firefighters, police, educators, EMS and everybody in between. That’s a big step in the right direction.”

The administration is seeking authorization to issue $5 billion in general obligation bonds in the public or private markets, and to have the ability to borrow up to $9 billion from the Federal Reserve.  However, officials say they do not anticipate borrowing the full amount. The bill, which has not been taken up by the State Senate, authorizes the Governor to take out the $9 billion from the federal reserve for a term of up to three years for the State directly and also on behalf of local governments that can’t access the lending program on their own. The State would pay the Federal Reserve 2.8 percent in interest, based on its credit rating and the Fed’s pricing grid. The bill also permits the administration to refinance the general obligation bonds on the public or private markets before they come due.

Please continue to check this blog periodically regarding updates to this bill.  As we all know, the economic fallout from the coronavirus pandemic may have a drastic impact upon all New Jersey public employees, to include New Jersey Public Safety Officers.  As such, it is imperative to ensure all New Jersey Law Enforcement Officer positions and their accompanying rights are adequately protected during these uncertain times.

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Photo of Donald C. Barbati Donald C. Barbati

Donald C. Barbati is a shareholder of Crivelli, Barbati & DeRose, L.L.C. His primary practice revolves around the representation of numerous public employee labor unions in various capacities to include contract negotiation, unfair labor practice litigation, contract grievance arbitration, and other diverse issues…

Donald C. Barbati is a shareholder of Crivelli, Barbati & DeRose, L.L.C. His primary practice revolves around the representation of numerous public employee labor unions in various capacities to include contract negotiation, unfair labor practice litigation, contract grievance arbitration, and other diverse issues litigated before the courts and administrative tribunals throughout the State of New Jersey. In addition, Mr. Barbati also routinely represents individuals in various types of public pension appeals, real estate transactions, and general litigation matters. He is a frequent contributor to the New Jersey Public Safety Officers Law Blog, a free legal publication designed to keep New Jersey public safety officers up-to-date and informed about legal issues pertinent to their profession. During his years of practice, Mr. Barbati has established a reputation for achieving favorable results for his clients in a cost-efficient manner.

Mr. Barbati has also handled numerous novel legal issues while representing New Jersey Public Safety Officers. Most notably, he served as lead counsel for the Appellants in the published case In re Rodriguez, 423 N.J. Super. 440 (App. Div. 2011). In that case, Mr. Barbati successfully argued on behalf of the Appellants, thereby overturning the Attorney General’s denial of counsel to two prison guards in a civil rights suit arising from an inmate assault. In the process, the Court clarified the standard to be utilized by the Attorney General in assessing whether a public employee is entitled to legal representation and mandated that reliance must be placed on up-to-date information.

Prior to becoming a practicing attorney, Mr. Barbati served as a judicial law clerk to the Honorable Linda R. Feinberg, Assignment Judge of the Superior Court of New Jersey, Mercer Vicinage. During his clerkship Mr. Barbati handled numerous complex and novel substantive and procedural issues arising from complaints in lieu of prerogative writs, orders to show cause, and motion practice. These include appeals from decisions by planning and zoning boards and local government bodies, bidding challenges under the Local Public Contract Law, Open Public Records Act requests, the taking of private property under the eminent domain statute, and election law disputes. In addition, Mr. Barbati, as a certified mediator, mediated many small claims disputes in the Special Civil Part.

Mr. Barbati received a Bachelor of Arts degree in history, magna cum laude, from Rider University in Lawrenceville, New Jersey. Upon graduating, Mr. Barbati attended Widener University School of Law in Wilmington, Delaware. In 2007, he received his juris doctorate, magna cum laude, graduating in the top five percent of his class. During law school, Mr. Barbati interned for the Honorable Joseph E. Irenas, Senior United States District Court Judge for the District of New Jersey in Camden, New Jersey, assisting on various constitutional, employment, and Third Circuit Court of Appeals litigation, including numerous civil rights, social security, and immigration cases.