New Jersey’s Short-Term Legislative Outlook

October 12, 2021

The New Jersey Legislature returns in November. What can we expect? Will we see movement on the Business Alternative Income Tax (BAIT) clean-up bill and other issues important to Garden State CPAs and the business community? Top New Jersey lobbyist Dale Florio gives us his insight on what might be accomplished during the lame duck session and the new legislative session that begins in January 2022. He also discusses the prospects for the Nov. 2 election in which the Governor and all 120 seats in the Legislature are up for vote.

Episode Transcript

Jeff Kaszerman: The New Jersey legislature returns in November. What can we expect? This is the IssuesWatch Podcast. Hi. I'm Jeff Kaszerman, vice president of government relations at the New Jersey Society of CPAs and welcome to the IssuesWatch Podcast. Our guest for this episode is Dale Florio, who heads up the Princeton Public Affairs Group, which is New Jersey's largest and most influential lobbying firm. He's worked in this field for, I guess, almost 35 years. And the NJCPA has been a client of theirs since 1998, so I have known Dale forever. Today, we're going to take a look at the important business issues that are likely to be addressed in New Jersey's two-month lame duck session, a session that starts in November. We're also going to look at what can we expect in 2022, when the new legislative session begins. I'm also hoping to learn a bit about Dale's personal experiences in working the halls of the state house in politics, especially during this pandemic. Welcome, Dale. It's good to have you again.

Dale Florio: Jeff, always a pleasure to be a guest on your show.

Major Issues

Jeff Kaszerman: Thanks. Let's jump right in. What do you see as the big issues impacting businesses and taxpayers that could move in lame duck or perhaps if not then, then the two-year legislative session that begins in 2022? What do you think will be those issues?

Dale Florio: Well, I think one of the big ones coming out of this election cycle, Jeff, will be whether or not the Governor and the Legislature are willing to help businesses with the most recent increase in the unemployment insurance rates. Collectively it's a $250 million hit to businesses around the state. And, certainly, all businesses are evaluating what their current rates are now. And if you're in the contracting business, anything that runs the risk of seasonal layoffs, your rates are going to be high. I think people are hoping that the Legislature and the Governor will come back and be willing to commit some of the federal dollars that are available. New Jersey's sitting on a big chunk of money that hasn't been spent yet. Anywhere between $4 and $7 billion.

I think there's also people holding out hope— I'm not as optimistic — but they'd like to see possibly a corporate tax decrease, especially in light of what happens or not at the federal level. As you know, tht there is a corporate tax increase as part of the infrastructure discussions. Depending on which way that goes at the national level, does the Governor, does the Legislature look at not only the corporate rates but also the personal rates? Because if the federal government moves in that direction, New Jersey certainly will be the highest corporate rate in the country. And, as you know, at the federal level they're talking about people that make over $400,000. A lot of money, but when you look at New Jersey, there are a lot of people with combined income that are making $400,000 or more just to live here because of the expense. A lot of people are looking to see what Congress and the President do, and that may dictate a lot of what we might see in the lame duck.

Jeff Kaszerman: Right, right. That unemployment insurance, helping that out with the fund, Murphy has already said no, implicitly, to doing that now, because — I forget all the details — but he basically let the costs go up without throwing any money in. Can he change it in 2022? Or does he have to wait for the next year to say, "Hey, I'm going to put some money into this."

Dale Florio: I don't have an answer to that question. Certainly, the Legislature could direct him to do something. Obviously, he has a chance to veto it. Could provide a business tax credit to offset the increase. I'm just not sure legally whether he can do something now, once it went up, which just up October 1, a couple of days ago.

Jeff Kaszerman: Yes. Let me ask you about something the Society was very active in — and that actually our former president wrote the initial draft — and that is the business alternative income tax. We were quite happy to see that pass, that saved businesses between $200 and $400 million in the very first year. However, it still needs some clean up, and we expect legislation to be introduced in a week or two. What do you think the chances are that something like that, which I don't think will really have any opposition, what are the chances of that moving in lame duck?

Dale Florio: I've heard and talked to legislative leaders who, as they're out there campaigning, they've heard from the business community about the cost of doing business, the cost of the impact of the pandemic. And again, because of the surpluses that we've been running on tax revenues, because of the amount of money that's available through the federal ARPA legislation, I think legislative leaders are looking to see where there are opportunities — strategic and targeted opportunities — to be helpful to small businesses especially. This is, as you know, it's been well over 10 years since New Jersey's had this kind of money available.

Jeff Kaszerman: I thought they'd never had this kind of money, but all right.

Dale Florio: Well, you're probably right to say that as well, but it's a once-in-a-lifetime opportunity. I think the leadership and the Legislature, they're looking at: do we do things that won't create more problems because we're now funding something that eventually the funding will run out and then we've got to depend on tax revenues? Or do we do projects that have a near-term immediate impact but won't create a legacy cost, like infrastructure projects, things of that nature? There are a lot of wheels turning about how to do that. I'm not sure that those conversations are happening with the Governor's office at this point. Certainly, if the Governor gets reelected, you can expect the traditional lame duck versus Legislature that's going to be looking at reelection the next time around. Plus, you're also going to have probably some people in the Legislature that are now looking to maybe be the next nominee for their party, which creates a whole other level of politics between the legislative branch and the executive branch.

Jeff Kaszerman: Well, never a dull moment. We have another bill that's very technical but basically it provides a tax break for vendors who work in the cannabis industry, who are minorities and aren't really going to have, I think, revenues higher than $10, $15 million, $20 million tops. We have a bill introduced. Is cannabis sort of all locked up now? And what I mean by that is they're sort of not looking at changes because of how much time they spent on it a year ago and how big and cumbersome the statute is already and the regulations. Do you think they're looking to whether or not they would consider something like that during lame duck or beginning of next year?

Dale Florio: It's not locked up in terms of this cannabis story. And to your other point, because the bill was and is so cumbersome, anytime you do something that extensive, there are going to be fixes. And I think they're going to be constant fixes. It would not be a surprise that not only that, or other tweaks that they would want to make. Whether they want to do them all or start to do that again in lame duck, unclear. We're still waiting for the first round of applications to be available for people to fill out. The regulations only recently came out and there were a lot of questions. I think you're going to see changes to the statute for years to come until it develops a cadence. But legislation like you just described would be very much in play because I think there's a bipartisan executive branch, legislative branch goal to really make this a homegrown industry as much as possible.

Jeff Kaszerman: No pun intended, right?

Dale Florio: There you go! And not be dominated by the outside market. Now, once we get 18 months into the first licensees, we'll see. There's some concern that 18 months isn't long enough before somebody can start to buy other licenses. But I know the goal is to try to make this as very much a local business opportunity for New Jersey residents.

Jeff Kaszerman: Right. Any predictions on when you can actually go to a store, a retail store and buy cannabis? Is that long?

Dale Florio: I would say sometime mid to late first quarter. Even though there's a delay in the application forms, hopefully the decision-making process won't be that long. I know we're still waiting on the 2019 round of medical marijuana applications, but I don't think that foretells what we will see on the retail side. I think they want to get them out. People that are very optimistic about being able to get a retail license, have done a lot of work in terms of securing locations. And so I think things will pop up pretty quickly, even if the storefront isn't exactly what they want to look like. I think the product will flow and so mid to late first quarter.

Jeff Kaszerman: We should revisit this issue in half a year. There so many aspects to this, like whether or not municipalities are going to allow it, so on and so forth but we'll save that for another day.

Dale Florio: Yeah, fun conversation for sure.

Election Predictions

Jeff Kaszerman: What are your thoughts on the elections coming up? Do you have any predictions?

Dale Florio: New Jersey, because we are the year after a presidential election, I think there's always a huge let down in terms of activity. And certainly, the presidential election was a very spirited contest. Needless to say. It dragged on, it wasn't over even though it was over.

Jeff Kaszerman: That's for sure.

Dale Florio: I think there's a little bit of a political letdown that kind of dovetails into New Jersey's gubernatorial election. We're now into October, New Jersey activity in politics is always a last three, two week affair. Both candidates have been working pretty hard. The polls, at least the public polls, would suggest that the Governor has a 10-point lead. Others would tell you that it's a lot closer than that. If you talk to operatives on both sides in both parties, they believe it's going to be close. But New Jersey Democrats have a million-person registration differential over Republicans.

For the Governor, if he can get his base to come out, he should win. But it's going to be a low turnout. And I think that's what has observers saying that it would be close. They would certainly say that the Governor is going to pull this one out. And on paper that's I think what you would see as well. The presidential election, I think, was mid to high sixties in terms of turnout. If it gets to 45%, maybe, in New Jersey, that just tells you the differences. You have to keep in mind that when Christie was reelected, that was the lowest gubernatorial turnout at that time. When Governor Murphy was elected in the first term, his first term, that then exceeded the low turnout. The last gubernatorial election was the lowest turnout we'd ever had. We'll see what happens this time, but I think most people are suggesting somewhere in the mid-forties.

Jeff Kaszerman: Yeah. I recall when I was younger, and maybe it's true except for Christie and Murphy, I remember in New Jersey they didn't care about the presidential election but the gubernatorial election was like trench warfare.

Dale Florio: I think that's true if you're talking to the political class, people in both parties. This is what it's all about. Even from a congressional standpoint. I think the political parties seem to care more about county and state government than they do about their congressional representatives at the time. I apologize in advance for any member of Congress that might tune into your podcast at some point. I think that's pretty much the case and that's why. But I think to the voting public at large, where they often look at their politics through the prism of national politics, again, the year after a presidential election there tends to be a little bit of a letdown in terms of interest and then consequently the turnout.

Jeff Kaszerman: Okay. And that makes sense. Any differences, or stark differences, you would expect if Jack Ciattarelli — who happens to be a CPA — any stark differences in issues that would move under Ciattarelli versus Murphy and what we've seen for the last four years?

Dale Florio: I think that part of Governor Murphy's, its not his problem, but so much of his time had been taken up managing the pandemic. Issues that are important to New Jerseyans outside of the pandemic, there hasn't been a whole lot of attention given to them. And so his attention's been diverted. Assuming that we're moving in the right direction, we're coming out of this and it should rally administration. I think you'll see a much more favorable ear toward business, especially small business. Listening to the candidate, he's talked about redoing the school funding formula, which is the basis for a lot of our property tax issues in the state. Most governors fear dealing with that. The last time it was dealt with was during the Corzine administration. Governor Christie didn't do anything with it and this administration hasn't done anything with it. They've put more money into the formula, but I think many observers would say that the formula, just because of population growths and school population increases and declines, the formula now needs to be adjusted to acknowledge all of that. I know that that's a big part of candidate Ciattarelli's platform.

Lobbying During COVID

Jeff Kaszerman: Right, right. COVID has had a huge impact on how the Legislature and state government have operated and functioned over the past 18 months. And so can you tell us a little bit about what that was like and what is was, or still is, like lobbying in the era of COVID?

Dale Florio: This is very much of a hands-on business. Democracy, at least at our level, is not a spectator sport. You really have to engage. There's a big difference between talking to a staff member or a member of the Legislature, on the phone as opposed to being say, in their face, talking about an issue. All of that was taken away and has remained away since early March of last year. To everybody's credit, whether you're on the state government side or you're on our side of the street, if you will, everybody's adjusted really well. The accessibility to staff and legislators has been extraordinary. Zoom, which has become part of everybody's daily routine, everybody's doing those but there's still a difference, Jeff.

When you can't see somebody in the hallway and capture them for about five minutes or so, just to talk through an issue. Now everything is really scheduled. where I could have walked through the hallway, talked to seven different people on seven different issues. Now I've got to call them, hopefully get them and or schedule something. I would say the intensity is certainly there. The level of the number of issues has remained but the throughput of actually getting to all of it in a timely way has probably been the most difficult part of it.

Jeff Kaszerman: Okay. Do you think any of these things like Zoom and other ways of operating that came up with during coronavirus, do you think any of that will remain in some way shape or form in state government, the Legislature?

Dale Florio: I hope it does stay where you say, "You know what? This is a really important issue, Senator. I'd really like to come in and talk to you about it." I think we will qualify things that need to be done in person or things that we can do by Zoom and a lot of routine things, "Hey, this is great. Just wanted to talk to you. I wanted you to meet our client." Or, something that's really big where we need a little time, where the face-to-face really would be good, I think that's when that needs to happen. I think we should look at it as a tool to get more done, more accomplished, as opposed to having to be just in front of somebody on a regular basis.

Jeff Kaszerman: Yeah. That's exactly what I thought.

Looking Back

Jeff Kaszerman: You opened your lobbying firm, Princeton Public Affairs Group about 30 years ago, which was a few years before I became active in politics. And it did not take long your firm to take off and become, really, the most influential and largest lobbying firm in New Jersey. And, of course, that's why we have been using you as our lobbying firm for almost 25 years. Now, of course, we like you guys also; you're good to work with. What are the biggest changes you've observed over the past 30 years in the state house and in politics in general?

Dale Florio: Actually, February 1 will be 35 years. And working with you for as long as we have and quite frankly, the brand that the Society is building in New Jersey as a go-to business forecaster, has been great. We've really enjoyed the partnership. Probably the biggest changes, the number-one change, is the lack of communication or the inability for all members, whether they're of the same party or of opposite party, to actually get together and get to know each other. Trenton used to have a very active evening scene in terms of restaurants. You're familiar with Trenton. That's changed dramatically. People don't go out.

Jeff Kaszerman: Why is that?

Dale Florio: Well, some of it has to do with the pay-to-play laws where the reporting requirements to go out to have dinner with somebody. That communication or getting to know somebody has really gone away, and we see it at the national level as well. Some of that is driven, I think, by social media. But so that to me, that's the number,one issue. Also, back at least when we got started in the late ’80s, early ’90s, there was a better balance politically. And now it's, New Jersey is, we can call I guess, a blue state. And so I think that at times when one party just dominates, the minority party isn't as loud of a voice as it would like to be. You can argue whether you get better government or not when things are a bit more competitive, but things have not been competitive. Although we've had Republican governors, from a legislative standpoint it's one party.

The need to compromise, at times, is more compromise within one political party, as opposed to both sides. We saw a lot of things getting accomplished during the Christie era because the Governor was forced to work closely with the legislative leadership. There were achievements by both sides. In the absence of that, sometimes you don't necessarily get that level of compromise when it's all one party. And we saw this back in the ’90s when it was Christie, Whitman and the Republican legislature, it was the same thing. It's not just the Democrats. It was the Republicans back in the ’90s as well. Split government, I think people would argue, might be better in terms of reaching compromises. But so those are the two big things that have changed. The inability and just the lack of time or the wherewithal for members to really get to know each other personally. And then New Jersey has just swung back and forth and is clearly now a blue state.

Jeff Kaszerman: Right, right. I've always said that if you have a competitive state with the Legislature and the Governor and things are close between the two parties, then they compromise and everything happens between the two and they fight each other. But when you have just one party, that whole dynamic transfers to the party itself, with one faction fighting another and so on.

Dale Florio: Some of your observers would say, "Gee, I'm listening to Dale say this, well, how does he explain Washington DC, where even though the Democrats are in control, the House majority is only six for the Democrats and it's split in the Senate it with the vice-president as the tiebreaker." Well, the difference there is that the congressional rules are so convoluted that you need super majorities to actually override what the minority party wants to do. In New Jersey and in most states, that's not the case. If we had those kinds of majorities in New Jersey where the Democrats were only up six in the House and the Senate was split and the Lieutenant Governor would have to come in, it would be a different story because legislation that just has a single subject, as opposed to these large omnibus bills that have multiple things in them and then cause all the friction.

Jeff Kaszerman: When I first entered the political arena — this is embarrassing — I thought that I was going to be the white knight who comes to the rescue of a public that was ignored and lied to by greedy, inept politicians who were only interested in their own power. Well, within a year or less, I had a totally different perspective. While there are bad apples and politics, just like any other profession, what I've come to recognize is there are many, many well-meaning, hardworking and really bright and knowledgeable lawmakers. In fact, when I think back to my original attitude, I kind of cringe at my self-righteous stupidity. How about you? Any big difference between your expectations before you really became involved in politics or just in the beginning of that and what the reality turned out to be?

Dale Florio: I think when I came into the system, you tend to put people, at least at a young age, I put them up on a pedestal. What I quickly realized that they're average people too. And I think that's one of the beauties of a state legislature, and I suspect this is the case in most states, these are men and women who have other jobs and they bring those experiences to their role as a legislator. And I think that's certainly what was intended when they created state legislatures.

That was clearly the intention when they created the federal government and Congress, that these would be least, it started out as men back in the early days, that would come in and bring in their experiences. Now that's become a professional class of politicians. We do have full-time legislators, but, by and large, most of them came from somewhere, whether they were in a licensed profession, whether it's a CPA or a lawyer, teachers. And that's, I think, very important because they bring those experiences in terms of when they're looking at legislation, we have bankers, we have people from all walks of life and that's the cool part.

Jeff Kaszerman: Right. That's funny because you had politicians on a pedestal that maybe they shouldn't have been on. And I just thought they were all evil and should be underneath a rock. Dale, I always enjoy talking with you and thank you for taking the time to be with us today. And I'm sure we're going to, well we'll definitely have you on our next budget preview, which is in March, and hope we can get you in for something else, maybe cannabis or there's certainly plenty to talk about. Good to have you.

Dale Florio: Thanks, Jeff, so much, always good to see you.

Jeff Kaszerman: Thank you all for listening and watching. You can track legislative issues important to CPAs and the business community at And I encourage all NJCPA members to contribute to the NJCPA PAC. At an average of only $4 per member, New Jersey CPA's PAC support is far below that of other professions in the state so please consider making a contribution today at And of course, remember to vote on November 2!


Dale  Florio

Dale Florio

Dale J. Florio brings over three decades of public affairs experience to the service of his clients. With a highly successful track record at all levels of government, Mr. Florio is widely recognized as one of the most influential public affairs professionals in the Garden State. In fact, PPAG– Princeton Public Affairs Group has been consistently named New Jersey’s Number One Lobbying Firm for the last fifteen years in a row.A graduate of Allegheny College with a B.S. in Economics and Seton Hall University Law School, Mr. Florio was admitted to the practice of law in New Jersey and Pennsylvania.

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Jeffrey  Kaszerman

Jeffrey Kaszerman

Jeff Kaszerman is the vice president of government relations for New Jersey Society of CPAs. He works with the CEO and board of trustees to create and implement advocacy initiatives that protect and promote the interests of the CPA profession, the business community and the public.

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