The Supreme Court in New Jersey has ruled against Republicans blocking the state’s Governor Phil Murphy, a Democratic, from borrowing $9.9 billion intended to help state offset the plummeting tax revenue caused by the pandemic.
The lawsuit filed by the New Jersey Republican State Committee came following a law passed by the legislators on July 16 to approve the borrowing.
The lawsuit said that such law violated the state’s constitution on appropriation and debt limitation clauses.
Ruling in support of the borrowing, the Supreme Court said the state’s COVID-19 Emergency Bond Act was constitutional, although would have to meet a condition.
It was said that officials would have to ascertain that projected revenue and fiscal shortfalls were actually caused by the pandemic.
However, the Chief Justice Stuart Rabner said that the plaintiffs have not been able to prove beyond reasonable doubt that the law was not constitutional adding that they have not met the heavy burden.
Stuart Rabner further said that COVID-19 qualified as a disaster and that permits the state to avail itself of the emergency financing to offset the shortfalls it already forecast.
Contrary to the state’s projection for June 30, 2021 before the pandemic strike, it was estimated that the state would collect much less tax revenue due to the presence of coronavirus; thus the need for the $9.9 billion cap.
New Jersey, a state with about 8.88 million populations, had earlier been a hotspot for the pandemic. It however currently have lower infection rates compared to other states across the country.
As of Wednesday, New Jersey has recorded about 187,328 coronavirus cases and 15,890 deaths.