TRENTON - New Jersey faces a tax revenue shortfall of more than $800 million for the current fiscal year, the Christie administration announced late Monday, vowing to take "any and all actions" to make up the difference.
That figure dwarfs the $145 million shortfall the state projected through March, leaving lawmakers scrambling for answers as the end of the fiscal year approaches June 30.
"This thing got dropped in on us like a bomb today," Senate President Stephen Sweeney (D., Gloucester) said in an interview. "It's serious, to be that far off this late in the year."
He added: "You don't get this late in the year where it's such a big number, where it's like, 'How do I fix this?' "
The administration still expects to make up the shortfall via "lapses," or unspent money.
The Treasury Department attributed about $700 million of the shortfall to flagging gross income tax receipts, which it said are "notoriously volatile due to [their] extreme reliance on a relative handful of taxpayers."
The revenue is also affected by swings in capital gains and business income, the department said.
It said it discovered the shortfall as it reviewed collections following the April 15 income tax deadline. The department said it usually receives large checks in April from the state's highest earners.
The department said the shortfall was largely due to the so-called fiscal cliff at the end of 2012, when George W. Bush-era federal tax cuts on high income-earners expired.
For example, it's possible that some people decided to sell stocks at the end of 2012 knowing that tax hikes were coming the following year.
Collections on corporate business, sales, and use taxes were also lower.
"The state will take any and all actions necessary to offset the reductions in anticipated revenues, including the identification of additional lapses and savings opportunities, as well as the exercise of the full range and scope of executive authority, including, but not limited to, reserving and/or impounding budgeted appropriations," Treasurer Andrew Sidamon-Eristoff said in a statement.
News of the shortfall comes as the Democratic-controlled Legislature debates Republican Gov. Christie's $34.4 billion budget proposal for fiscal 2015. The state must pass a balanced budget by June 30.
This month, the budget officer for the state's nonpartisan Office of Legislative Services projected a revenue shortfall of $526 million through fiscal year 2015. OLS officials could not be reached Monday evening.
The Treasury Department noted that OLS's estimate for gross income tax revenue was not much more accurate than the amount projected by the governor in February. The OLS estimate of the shortfall was just $87 million greater than the administration's.
It said other states, such as Connecticut, were grappling with similar unexpected shortfalls.
"This is everyone's problem to solve, and we're now going to have to roll up our sleeves and get to work solving this without damaging the valuable programs needed by residents," Assembly Speaker Vincent Prieto (D., Hudson) said.