A-4175, which was passed by the Assembly on June 4, would permit the issuance of $5 billion of state debt without voter approval to address the massive fiscal and economic dislocations caused by the COVID-19 pandemic. Among the purposes to which the proceeds of these bonds could be put is funding general state operations through the annual appropriations acts for fiscal years 2020 and 2021. The bill requires that all proceeds from bonds be paid into the state Treasury.

This attempt to reduce what would otherwise be an unprecedented shortfall in state revenue raises at least two serious issues under our state constitution. Article VIII section II paragraph 2, the “balanced budget” provision of the Appropriations Clause, mandates that the total appropriations in a fiscal year may not “exceed the total amount of revenue on hand and anticipated which will be available to meet such appropriations during such fiscal period, as certified by the Governor.”