Failure to Allow Vote on Transitional Aid Bill Likely to Lead to Downgrade by Moody’s
Senate Republican Leader Tom Kean (R-21) said that by stalling on a transitional aid bill that would provide a much needed financial lifeline to several struggling New Jersey cities, legislative Democrats have increased the likelihood that credit rating downgrades will be issued for those cities making future borrowing more expensive.
“The failure of Democrats to move forward on approving a transitional aid bill that is waiting to be voted on will hurt the residents of New Jersey’s cities both now and in the future,” said Kean. “This aid would help our cities to fund critical services including police and fire departments in their current budgets, and would prevent likely credit downgrades that would make future budgets even more expensive for taxpayers.”
Kean’s comments followed a report that Moody’s Investor Services is reviewing Camden, Trenton, East Orange, Passaic, Paterson and Union for a potential credit rating downgrade due to the state’s inability to approve transitional aid for those cities.
Kean noted that legislation sponsored by Senator Kevin O’Toole (R-40), S-3024, would provide $139 million in transitional aid, and that Governor Chris Christie has committed to signing the legislation once it is approved by the Legislature. O’Toole’s bill includes strong and unambiguous oversight provisions to ensure that the aid is used appropriately.
Additionally, the state’s Department of Community Affairs has already announced how much transitional aid will be distributed to eligible cities once S-3024 is approved, including allocations of $61.4 million for Camden, $22 million for Trenton and $21 million for Paterson.
“Just yesterday, the Senate Budget and Appropriations Committee met to consider more than a dozen bills, yet this bill was not deemed to be important enough by Democrats to post for a vote,” added Kean. “The Democrats’ continued inaction will only hurt those who need this help the most.”