Murphy says 'everything on table' to solve NJ Transit fiscal woes. Except corporate tax

Gov. Phil Murphy reiterated Thursday that "everything is on the table" when it comes to solving NJ Transit's upcoming fiscal crisis.

Well, almost everything.

He doubled down this week at a New Jersey Business and Industry Association event in saying he plans to allow the 2.5% surcharge tacked on to the corporate business tax for five years to sunset at the end of the year.

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That surcharge, applied only to businesses that receive over $1 million in profit, could generate $1 billion a year, and some transit advocates hoped it could plug the hole in NJ Transit's operating budget going forward, an idea recently endorsed by Senate President Nicholas Scutari.

NJ Transit officials have predicted they will have a $120 million budget shortfall in the coming budget cycle, which starts July 1. The year after, it is expected to eclipse that, rising to $917 million.

More: Could the NJ corporate business tax surcharge survive to fund NJ Transit?

More: NJ Transit has had many fiscal crises. Here's why the one that's looming will be worse

State Sen. Paul Sarlo, who has chaired the Senate budget committee for 13 years, agreed with Murphy about ending the surcharge, which was always meant to be temporary, but didn't come up with alternatives for NJ Transit.

"We need to find some type of dedicated revenue source in the budget. … What does that look like? I’m not sure," Sarlo said at the same NJBIA event.

Finding funding for NJ Transit 'a work in progress'

Murphy was asked the same question about alternatives at an unrelated event Thursday and had a similar response.

"It's a work in progress. It's not hanging over our head tomorrow ... this is really two years from now, but we're going to be laying the tracks, no pun intended, working with NJ Transit to figure that out," Murphy said.

The lack of ideas strengthens the case to keep the corporate business tax surcharge, said Alex Ambrose, a policy analyst at New Jersey Policy Perspective who helped author a report earlier this year that advocated for the surcharge.

"If there is a better solution I would love to see it, but I have yet to see it," Ambrose said. "Using the surcharge is the most straightforward solution."

This article originally appeared on NorthJersey.com: Murphy to end corporate tax that could save NJ Transit