by Nikita Biryukov, New Jersey Monitor
NJ Transit will reduce its budget by 5% in line with Gov. Phil Murphy’s request for state agencies to cut spending amid a budget crunch, but it will not slash services, the agency’s new CEO says.
Kris Kolluri, who took the helm of the transit agency on Jan. 16, said NJ Transit has already cut its spending by the amount Murphy is seeking. The agency operates on a $3 billion budget.
“In the four weeks I’ve been on the job, we’ve already produced a 5% cut — if not more — without cutting a single bit of service. It isn’t magic. It’s just hard work. It isn’t easy, but we have to make those decisions,” Kolluri said Wednesday at an event hosted by the South Jersey Development Council.
Speaking to reporters after the event, Kolluri declined to provide specifics about the cuts.
“My view is — I’ve been through five of these before — that we have to make an earnest effort to find efficiencies where we can without cutting service, and the governor will detail more of that as time goes on,” said Kolluri, a former commissioner of transportation.
Murphy is set to deliver his final budget address next week (he leaves office in January). In October, he tasked department heads with identifying cuts equal to 5% of preliminary budget targets in a bid to bridge broad deficits in the state’s current spending plan that are due to expand in the next fiscal year, which begins July 1.
Kolluri said he does not share fears held by some observers that revenue from a new 2.5% business surtax, called the corporate transit fee, would not reach NJ Transit. Transportation advocates and some industry groups have worried lawmakers may redirect revenue from the tax, which is statutorily dedicated to NJ Transit, to make up for shortfalls elsewhere in the state budget.
“I have not seen any indication that the corporate transit fee will not come to transit,” Kolluri said. “That’s for us, priority one, and I think you’re going to see evidence of that.”
The tax is expected to generate roughly $800 million for NJ Transit until it expires at the start of 2029.
New Jersey’s current budget calls for the state to spend $2.1 billion more than it takes in through taxes. Absent broader shifts in the state budget, expiring one-shot revenue sources will raise that deficit to more than $3.8 billion in the next fiscal year.