SENATE BUDGET AND APPROPRIATIONS COMMITTEE

STATEMENT TO

SENATE, No. 1321

with Senate committee amendments

STATE OF NEW JERSEY

DATED: JUNE 20, 1996

      The Senate Budget and Appropriations Committee reports favorably Senate Bill No. 1321 of 1996 with amendments.

      Senate Bill No. 1321, as amended, requires the State to make an additional distribution of public utilities gross receipts and franchise taxes revenue during Fiscal Year 1996. The amount of the distribution is equal to the amount by which collections of these taxes have exceeded the State anticipated retention of $275 million plus the $685 million previously apportioned for distribution to municipalities during Fiscal Year 1996. In statements to the Senate Budget and Appropriations Committee and the Assembly Appropriations Committee on April 2, and May 22, 1996, the State Treasurer indicated that the State estimates this amount to be $45 million.

      The distribution of the additional collections is first to be made in amounts equal to decreases, if any, resulting from corrections to apportionment valuations made by the Director of the Division of Taxation pursuant to R.S.54:30-2 (which allows the director to correct for clerical errors or omissions in the apportionment of taxes), and then in proportion to the municipal distributions made from the $685,000,000 apportioned and paid earlier in the fiscal year. The supplementary distribution must be used by the recipient municipalities to reduce the local municipal property tax levy, which shall be reflected as a change in the municipal budget.

      As amended and reported, this bill is identical to Assembly, No. 35 Aca of 1996 (Kramer/Wright).

COMMITTEE AMENDMENTS

      The committee amended the bill at the request of the sponsor to delete a special distribution to Wall Township.

FISCAL IMPACT

      This bill appropriates $45 million in additional public utilities gross receipts and franchise tax revenue for distribution in Fiscal Year 1996.