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  • NJ A316
  • Requires an annual State debt affordability analysis be included in the State Debt Report.
In Committee
Crossed Over
2016-2017 Regular Session
This bill requires the State Debt Report to include an affordability analysis to provide executive and legislative policymakers a clear, data-driven framework for evaluating and establishing future State debt management and issuance priorities. The purpose of the bill is to enable a more fully informed fiscal policy discussion on the State's long-term debt portfolio to ensure sufficient financial capacity for essential capital projects. The bill requires the State Debt Report to include a detailed analysis and narrative discussion of the State's ability to afford an increase in its overall debt and the affordability of the amount of any such increase. The affordability analysis will include: · An estimate of revenues generally or specifically available for the next 10 fiscal years to pay debt service; · An estimate of additional debt issuance for the next 10 fiscal years for the State's existing borrowing programs; · A schedule of the annual debt service requirements, including principal and interest allocation, on outstanding State debt and an estimate of the annual debt service requirements on the additional debt projected for existing borrowing programs for each of the next 10 fiscal years; · The calculations and listing of pertinent debt ratios, including, but not limited to, debt service to State revenues available to pay debt service, debt to State per capita personal income, and debt per capita for the State's net tax-supported debt; · The estimated debt capacity available over the next 10 fiscal years benchmarked to various debt ratios of debt service to State revenue exceeding current actual percentages; · A comparison of the State's debt ratios with the comparable debt ratios for the 10 most populous states; · An overview of the State's general obligation credit rating and a review of the criteria used by municipal securities rating services in rating governmental obligations; and · Such other information as the Commission on Capital Budgeting and Planning deems relevant to the foregoing matters. The bill requires State agencies, independent authorities, and other entities issuing debt secured by State revenue, or assisting in the issuing of that debt, to provide all information determined necessary by the commission in order to complete the debt affordability analysis. In an effort to finance essential capital projects for the benefit of State residents at favorable borrowing terms, the State must strive to establish a stable and improved credit standing with investors. Authorizations of state debt must take into account the ability of the State to meet its total debt service requirements in light of other demands on the State's fiscal resources. Thus, this bill will assist the Executive and the Legislative branches to exercise a long view of full, fiscally relevant and future-looking analysis of debt affordability in order to exercise prudence in undertaking the authorization and issuance of debt.
2nd Reading in the Assembly, Budget, Budget and Appropriations, Passed Assembly
Received in the Senate, Referred to Senate Budget and Appropriations Committee  (on 11/3/2016)
Date Chamber Action Description
11/3/2016 S Received in the Senate, Referred to Senate Budget and Appropriations Committee
10/20/2016 A Passed by the Assembly (66-7-1)
10/13/2016 A Reported out of Assembly Committee, 2nd Reading
10/13/2016 Assembly Budget Hearing (14:00 10/13/2016 Committee Room 11, 4th Floor)
1/27/2016 A Introduced, Referred to Assembly Budget Committee
Date Motion Yea Nay Other
Detail 10/20/2016 Assembly Floor: Third Reading - Final Passage 66 7 7
Detail 10/13/2016 Assembly Budget Committee: Reported Favorably 10 2 1