Murphy's hurdles.

Byline: Jessica Perry

New Jersey is in a "fiscal death spiral" and the last thing the state should do is raise taxes, the legislature's top Democrat warned.

In the days following Gov. Phil Murphy's March 5 budget address, Senate President Stephen Sweeney, D-3rd District, again touted what he calls the "Path to Progress" a list of proposals to lower taxes and reduce public worker pension and health care obligations.

The recommendations were outlined last August by the Economic and Fiscal Policy Working Group, convened by Sweeney. In a series of sit-down interviews with select media outlets in recent days, Sweeney said many of those proposals should have been included in Murphy's budget for fiscal 2020, which starts July 1.

Sweeney's approach, along with that of Assembly Speaker Craig Coughlin, D-19th District, will largely shape what the governor is able to achieve in the upcoming budget negotiations. The process will kick off with a hearing at the Assembly Budget Committee on March 20.

RIP, the millionaire's tax

After Murphy's budget address, Coughlin insisted that a millionaire's tax remains off the table and that the administration should find more savings instead. The proposed $38.6 billion spending plan calls for $1.1 billion in savings by the end of the 2020 fiscal year.

"I think we're going to continue as we do to see if we can find efficiencies and ways to be able to reduce spending," Coughlin said in a March 12 interview with NJBIZ. "We will look for dollars [and] savings wherever we can find."

A large chunk of those savings $800 million comes from reductions to health care expenses, and both lawmakers commended Murphy for the cuts, calling them a "good start."

"Most of the things we said would save money on health care last year, they said wasn't real, [now] they come around," Sweeney said.

He insisted that more savings can be found by going further down that same road, rather than enacting the millionaire's tax.

Under Murphy's proposal, the state would increase the tax rate from 8.97 percent to 10.75 percent for those earning more than $1 million a move the administration says will generate $447 million in revenue. The scheme calls for higher taxes on 18,066 New Jersey residents and another 19,057 non-residents; that is, people who work here but live outside the state.

Murphy failed to enact the tax last year and settled for a "mega-millionaire's tax" on earners above $5 million.

"I'm not supporting it. I'm not raising the income...