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>> Tonight, Governor Murphy delivers his final budget address, pledging to cut back the rising cost of living.

>> With our budget proposal, we will move forward in meeting our highest priority of all, delivering economic security and opportunity to every New Jersey in.

>> 28 billion in property tax relief and more money to modernize mass transit.

And all aboard, full steam ahead as the Hoboken pass station reopens on time after a 25 day closure.

>> A more reliable service into and out of Hoboken.

>> And the millions in Midtown.

It touting the tools already collected since congestion pricing rolled out.

NJ Spotlight News begins right now.

♪ >> From NJPBS studios, this is NJ Spotlight News with Briana Vannozzi.

>> I am Joanna Gagis in for Briana Vannozzi.

Governor Murphy delivered his eighth and final budget address today in front of a joint session of New Jersey Legislature and outlines key priorities for his final year.

The total $58 billion budget marks another record high spending plan proposed by Murphy.

He is also touting a $6.3 billion surplus and 15 times higher than the surplus when he took office.

Among the key priorities this year leading to the record spending, property tax relief once again fully funding New Jersey's schools, modernizing transit, they arrive together program and a number of health care initiatives that will impact residents.

Here are some key highlights from his last budget address.

>> Over the past seven plus years with the help of everyone in this chamber, we have begun building a new jersey that is stronger, more fair and more prepared for the future.

Though we have come far on the journey, let me be absolutely clear, we have not reached the finish line yet.

Because today, at a time when working families have been pummeled by rising prices and the noise of chaos and confusion in Washington is louder than ever, the reality is working people who keep our state moving cannot afford to slow down.

And neither can we.

Because we need to keep fighting with every fiber of our being for our children, workers, parents, senior citizens, and every New Jersey and who is struggling to get by.

So as I declared last month during my state of the state address, I am not done yet, and we are not done yet.

And with our budget proposal, our administration will continue delivering economic security and opportunity to every New Jersey and by providing yet another round of record high tax relief.

Over the past -- [APPLAUSE] Over the past seven plus years and in partnership with the guys behind me, we have delivered more property tax relief to the people of New Jersey than any administration in history.

Today I am proud to announce that our budget will include a new sales tax exemption for cribs and other critical baby supplies to make life more affordable for more families.

[APPLAUSE] So altogether, we are providing record high relief to New Jerseyans up and down our state, from tenants to working parents to senior citizens.

And with our budget, we are going to provide even more relief to our state seniors through speaker Coughlin's stay NJ program.

[APPLAUSE] This program will provide hundreds of billions of dollars in relief to seniors all across New Jersey so they can afford to remain in their homes and stay close to their kids and grandkids.

Just last year, with the help of Senator Troy Singleton, Senator Lopez and many of you in this chamber, I signed the most important affordable housing law that New Jersey has seen in more than 40 years.

And this year, we are going to build upon that accomplishment by reforming New Jersey zoning and permitting laws to make it easier to build new affordable housing where it is needed most.

With every budget we have introduced, we have provided record high funding for our K-12 schools.

And with our final budget, we will once again fully fund New Jersey's public education system.

[APPLAUSE] And we are also going to reduce volatility in the school funding process by ensuring that no school district sees a steep reduction in state aid from one year to the next.

[APPLAUSE] Altogether, our budget will provide the single largest investment into New Jersey's public schools in history.

And our budget will help parents with young children save even more money, by providing new funding to make free full day pre-k a reality in communities all across the Garden State.

Last year, New Jersey emerged as the fastest growing state in the Northeast, and one of the top 10 fastest growing states in the country.

And while that is fantastic news on many levels, including and especially for our economy, it also means our public transit system is as busy as ever.

And that is exactly why over the past seven plus years our administration has restored and dramatically increased funding for NJ transit.

And now we are -- with the proposed budget we will move forward in fully modernizing NJ transit by providing funding to begin replacing every single outdated bus and rail car that remains in the agency's fleet.

Getting this done will make NJ transit more reliable and accessible for every New Jersey and.

One of my single highest priorities as governor has been restoring trust in Trenton's leadership.

With every budget we have proposed we have sought to make smart, prudent decisions today so our taxpayers feel more economically secure tomorrow and in the decades to come.

In our budget proposal for the next fiscal year, it's no different.

But at the same time, we are also demonstrating restraint when it comes to spending taxpayer dollars.

In fact, our budget will largely cap all new discretionary spending.

Because of our states working families are forced to make hard decisions when it comes to cutting costs, we in the state government should hold ourselves to the same standard.

And that same spirit, I am proud to report our budget will include a more than $6.3 billion surplus, which will help -- [APPLAUSE] Which will help guard us against unforeseen challenges, including the uncertainty that has swept over Washington.

When I entered office, to put this in context, we inherited a budget with a $400 million surplus.

With our final budget proposal, we will make sure we leave the next governor a surplus that is more than 15 times greater.

We have demonstrated that our states leaders can meet our fiscal obligations without compromising on our moral obligations.

And we are doing so once again.

Our budget will make the full payment into New Jersey's pension system for the fifth year in a row.

[APPLAUSE] [APPLAUSE] By doing so, every worker who has served our state can enjoy the dignified retirement they have richly earned.

I think it is safe to say that we are facing more uncertainty at the federal level than at any other point in modern history.

This uncertainty is a direct impact on all of us, and most importantly, the people of New Jersey.

We cannot negotiate a budget in a bubble.

And while I sincerely hope that the situation in Washington settles down and that we in turn have a normal, healthy budget season over the next few months, it is by no means a guarantee.

There is a distinct possibility that we will instead need to pursue a break the glass strategy.

What that looks like, we cannot say.

But we must acknowledge and adapt to the new reality.

As I said, last month I had every intention of working in good faith with the Trump Administration to better the lives of the people we serve.

We worked with them a couple of times over the past couple days.

But just as important is if this administration tries to attack our most vulnerable neighbors, I will never back down from defending their rights and freedoms.

In every aspect of the budget I present to you today it is crafted to make our collective dreams for New Jersey a reality.

From meeting our secret obligations to the people we serve to facing our challenges honestly, responsibly, to strengthening the economic security of every New Jersey and, together, we are going to write our state's greatest chapter yet and we will leave our children a state that is better than we found it.

Thank you all so much.

May God bless you and your families, and may God continue to bless the great state of New Jersey and the United States of America.

[APPLAUSE] >> Briana Vannozzi was on the floor of the assembly chamber alongside our finance writer, bringing us live updates and interviews with those on the ground.

They join us now to offer insight on the key budget items announced today.

Obviously we have her do some of this before in governor's speeches, the focus on education, transportation.

John, we heard top line priority from the governor today, property tax relief.

Talk about what some of the programs will look like, and stay NJ, what will it look like and can the state afford it now?

John: Good question.

Another more than $2 billion for the anchor program that provides benefits to homeowners and renters who meet certain income standards.

The good news is the program is fully funded again.

On the other side is the benefits are staying flat, which means if you have had a property tax bill increase or your rent went up the benefits you will get from the state through the programs are not going up along with those increased taxes and rents so every year that goes by with flat funding of these types of benefits, we basically see an erosion of how much of your property tax and rent is offset.

But good if you receive benefits that you will at least continue to get benefits.

>> What would stay NJ look like?

John: Another good question, $600 million to get this program which is supposed to benefit 430 1000 senior homeowners in New Jersey to help them afford record high property taxes.

There is enough money to get the program off the ground and running but the big question is what happens going forward because the price tag is supposed to double in future fiscal years and there is no money set aside for that yet.

>> NJ transit is another huge budget line item here that the governor has talked about.

Last week I spoke with the new head of NJ transit, was that it will cost the state 700 $50 million to modernize our fleet of buses on railcars.

That is just about the total the state is looking to receive from the corporate transit fee.

Talk through what the funding source will look like for New Jersey.

>> That was the big question heading into today, whether or not the state would appropriate the full amount of the corporate transit tax to New Jersey transit.

Last year they took that billion dollars and put it in the general fund, which they could do because New Jersey transit still had some federal money it could rely on and Covid money so you can make the argument that was a smart fiscal choice at the time.

This year, we are going to see $815 million from the corporate transit tax go directly to New Jersey transit.

Rail advocates, progressive advocates, Republican lawmakers, those have been hitting the governor's office hard on this because we know not only does New Jersey transit have a physical quit but federal money will dry up.

They raised fares but they are facing what will be some [INAUDIBLE] The 815 one million is about what is expected in new going forward, give or take.

There is some money that needs to be constitutionally dedicated from not because of a litany of things that happened in 2014 when they made this all possible but they can expect that amount of money this year.

It will help them upgrade the fleets.

>> And let switch to the biggest item, education and the pension payment.

Both have been fully funded by this administration year over year.

We see additional increases in education funding for schools to the tune of close to $400 million, bringing us to a total of 12 million just to fund the schools.

Add to that the pension.

What are we looking at for a pension payment this year?

>> That's right and when you think of it the pension payment which is rising to $7.2 billion and that funds obligations for current workers who are retiring and also retired workers to make up for years and years of the state not making full pension payments.

When you take that direct money to the classrooms and then you add another seven and change for the pension contribution, you are talking about a full third of the total budget just in those two items.

The direct lead to classrooms K-12 public schools, [INAUDIBLE] And then another 7 billion with the largest portion of the pension contribution really going to pay off what is effectively a credit card bill that prior administrations on a little bit of this one have brought up in years when we were not making the full pension contribution, anyone with a credit card just knows that pushes the bill forward.

>> And an important piece of this that I'm sure we will talk about in the days to come is the issue of the school funding formula.

The governor in this budget wrote in 3% floor, eight cap on how much state aid each district could use those school districts can budget, which is really their argument in having to cut staff at the last minute.

>> To that point and to the volatility issue, we do not know what is going to happen with certain funding streams coming from Washington.

Medicaid, when billion in school funding could be at risk.

What happens if we do not receive that funds, has this governor allowed for New Jersey to have some slack to pick up some of the costs?

>> We were in a budget briefing earlier today where the governor's staff said he is very concerned about three items in particular.

Medicaid, because it is a one-to-one match the state has to make up with federal money.

Transportation, and education.

So he is dead set on making sure this surplus stays at or about $6 million, that is a priority for him.

A lot will happen between now and June with the budget as it always does when we have the added uncertainty of hetero money that likely will get cut.

>> And the governor said he will cap discretionary funding in this budget but like you said, a lot can change between now and June.

Thank you both so much for the insight.

Great work in Trenton today.

Republicans are once again slamming the record level spending coming out of Trenton.

Some say in Governor Murphy is spending the state into ruin.

Senator Declan O Scanlon shared his reaction to the fiscal plan earlier today.

Here is their conversation.

>> Let me bring in Republican budget officer Declan O Scanlon.

I know it is a little tricky with this going on in the background but we want to get you so I know you all have a response [INAUDIBLE] $58 billion budget.

>> This is where it starts.

[INAUDIBLE] When all is said and done [INAUDIBLE] >> And Republicans in the caucus have threatened to sue the governor if in fact items that are not appropriated to a direct state -- >> Provides that if you get a dole out it has to be given out based on sound formula.

Last year there were dozens of line items that did not do it.

[INAUDIBLE] >> I saw you writing down some items during the speech when the governor was calling on his critics to find other areas to cut.

What would you cut?

You said this was a disaster waiting to happen.

>> We have come up with hundreds of items we would cut.

Put in dozens of reforms.

It would provide millions in relief and spending.

It is a lame challenge that [INAUDIBLE] You would have to cut pension, you would have to cut transit.

You cannot cut pension payments.

But there is tons of work in the budgets.

I would cut stadiums [INAUDIBLE] >> The one in Middlesex County.

>> I could find a billion dollars in this budget we could cut when it is finally done this year, it is not hard to do.

>> A lot has been made about the surplus this governor has focused on, the uncertainty of course in what money we will and will not get from the federal government.

As far as being a good fiscal steward, is it not a good idea?

>> It's better to have a balanced budget.

You are better off having [INAUDIBLE] 85 billion dollar balanced budget than a $10 billion surplus.

[INAUDIBLE] Huge billions of dollars of federal money, close to 20 billion of the last seven years, we should hands the next governor a sounds balanced-budget.

We are not.

>> To push back on that, the governor's office says the structural deficit for this budget on paper right now, we know things will change between now and April and June, is about $1 billion so the structural deficit is less than it was, still they are to your point.

But has shrunk.

>> That is wrong.

As we sit here today it is between three and 4 billion and it does not hard to figure out how it works.

If you are looking at the surplus coming down it is about $1.5 billion.

After you take out [INAUDIBLE] We are spending down our surplus at an alarming rate.

>> You have said you are not necessarily against save New Jersey.

>> It is part of the structure because it is not funded down [INAUDIBLE] You immediately get to three or $4 billion of structural deficit without even scratching the surface.

We will find in the next several months as we dig into it.

>> Anything you can get behind or you can see your caucus getting behind?

>> The transit thing was completely absconded by this administration last year, I fully back that, it has happens, transit is a mess and when the governor came into office he said he was going to fix New Jersey transit and at that as a broken promise, it is on life support [INAUDIBLE] Corporate transit fee [INDISCERNIBLE] [background noise] But so much, billions of dollars that should not be happening in a time when we have a structural deficit.

>> Declan O Scanlon, thank you so much, we will catch up with you were that response as well.

>> All the board in Hoboken.

The port authority keeps its word, reopening the station today after it was closed for about a month for renovations and repairs.

During that time, crews fixed the tracks on the 100 17-year-old system, created wider staircases, and resurfaced and refurbished the platforms.

They lifted a 35-year-old tracks switch from underground that was prone to mechanical issues.

It's part of the port authority to year, four hundred $30 million effort to improve the path near the closure created some inconvenience for commuters had to find alternate routes.

While the work is still not done, leadership says the short term pain of the closures will be worth it long run with long-term improvements for commuters.

>> A more reliable service into and out of Hoboken going forward.

And the path forward program, it's a two-year program so we still have more sections of the title we need to work on for track stabilization and we will continue with that work.

>> Tonight, the controversial congestion pricing plan in New York City is pulling in big bucks.

MTA reports the program generated more than 48 million dollars in January alone.

Congestion pricing went into effect last month, charging drivers nine dollars to enter Manhattan.

They say 70% of the money came from passenger cars with 20% generated by taxis and other for higher cars.

The agency says the first figures show they are on track to meet their goal of $500 million in revenue to improve MTA transit system.

The future is still up in the air with President Trump and the Department of Transportation signaling they will and the pricing scheme.

New York Governor has sued the administration to keep the program in place.

That is going to do it for us tonight.

Remember you can download the NJ Spotlight News podcast and listen to us anytime.

For the entire team here in new work and at the Statehouse, thank you for being with us.

Have a great night.

We will see you right back here tomorrow.

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