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Gov. Murphy Pitches New Jersey Budget Boosting Education, Transit, Public Pensions

TRENTON, N.J. (CBSNewYork) - Thunderous applause welcomed Gov. Phil Murphy, who before presenting the hard facts on his proposed budget for New Jersey, showed he was ready to take on his own personal challenges.

Over the weekend, the governor announced he is being treated for a possible cancerous tumor on his kidney, reports CBS2's Hazel Sanchez.

"One last item which may not be greeted with the same universal applause, I'm not going anywhere," said Murphy to a room full of applause.

The governor then unveiled a $40.9 billion budget for the fiscal year 2021, boosting overall spending by more than 5% compared to the plan he put forward last year, and increasing taxes on the wealthy.

"The answer to the question of affordability isn't found in rewarding the special interests," the governor said. "It is found in creating new opportunities that reward our middle class - fixing what's broken and addressing the everyday needs of New Jersey's families."

Murphy's plan calls for increased spending on education, transit and public pensions and would set aside $1.6 in surplus, compared to $1.2 billion this year.

"We were told the math couldn't possibly work," he said. "They said we couldn't be pro-growth and progressive, that we couldn't make New Jersey stronger and fairer... Today, we are proving the naysayers wrong."

Murphy wants to:

"This will protect NJ Transit commuters from a fair hike for the third straight year," he said.

The governor is not seeking to raise the sales tax, but he is looking to increase the tax on cigarettes from $2.70 to $4.35 a pack, which is estimated to bring in $218 million.

Murphy's proposal must first wind its way through the Legislature, which can change it, before the June 30 deadline. The state constitution requires a balanced budget be in place by the state of the fiscal year July 1.

Few of the changes Murphy is seeking come as a surprise. He wants to increase the public pension payment from $4.1 billion to $4.6 billion, adhering to a schedule to ramp up payments agreed to under Republican Chris Christie.

He's seeking a boost in aid to school of $465 million, or nearly 5% over last year. New Jersey Transit, which saw its subsidy from the state's general fund fall to as low as $33 million under Christie in fiscal year 2016 would be $590 million under Murphy's 2021 proposal. That's an increase of nearly 30% over last year's general fund subsidy.

As he has in the last two budget proposals, Murphy is calling on lawmakers to boost marginal tax rates on incomes over $1 million from 8.97% to 10.75%. The change is estimated to bring in about $500 million to the Treasury. Lawmakers have balked at it. Senate President Steve Sweeney, though, says he would consider the increase if Murphy can find $1 billion more for the state pension.

There are other changes, as well. Murphy is seeking $30 million for a community college grant program that would provide free tuition to about 9,500 students whose families earn $65,000 or less.

He wants $50 million set aside to expand tuition-free college for the first two years at public colleges and universities.

(© Copyright 2020 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.)

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