(The Center Square) – New Jersey officials say a move to retire debt will save taxpayers more than $500 million.
The state Department of the Treasury said it is retiring more than $3 billion in combined debt principal and interest.
“At the end of the day, we have substantially reduced our debt load while securing real savings for the taxpayers of this state,” State Treasurer Elizabeth Maher Muoio said in an announcement.
The state’s fiscal 2022 budget included $3.7 billion for the Debt Defeasance and Prevention Fund. Of that, $2.5 billion is for retiring existing debt, while $1.2 billion supports capital construction to avoid incurring new debt.
New Jersey Senate Budget Chair Paul Sarlo, D-Bergen, said paying down the debt will make the state more affordable.
“Our focus in crafting the last two budgets has been on affordability and fiscal responsibility, and our ability to pay down $3 billion in high-interest debt will produce more than $600 million in savings for New Jersey taxpayers,” Sarlo said in a statement.
“Paying down this debt early builds on the savings achieved by making a full up-front pension payment for the first time in decades, freeing up the state budget to make critical investments that will benefit future generations, create jobs and make New Jersey affordable for all of our citizens,” Sarlo added.