The law also requires a May 22 report by the state treasurer "on the financial condition" of the current fiscal year's budget as well as the succeeding fiscal year's budget. The succeeding fiscal year will start Oct. 1, 2020, and end on June 30, 2021.
Any additional spending for the state operations from July 1, 2020, through Sept. 30, 2020, must be made " through the enactment of a general law that amends or provides for a supplemental appropriation to that annual appropriations act," the law said.
The governor must file a revised budget proposal for fiscal year 2021 by Aug. 25. His initial proposal was submitted in mid-February just before stock markets fell due to the economic impact of the coronavirus.
Also late Monday, Moody's Investors Service changed its outlook on New Jersey to negative from stable. The ratings agency retained its A3 rating on the state's general obligation bonds.
"The negative outlook reflects the expectation that the state will have difficulty balancing fiscal 2020 and fiscal 2021 budget gaps given its low reserves and pre-existing structural budget imbalance," a Moody's report said.
"The state's fiscal recovery will be multiyear, as revenues slowly recover to prior highs while scheduled pension contributions continue to ramp up," the report said. "In addition, if recent stock market volatility persists, the state's unfunded pension liability will grow, further elevating fixed costs."
The report said New Jersey's return to a stable outlook "will depend on the depth and duration of the coronavirus-related economic disruption and on the state's budget balancing actions." Warning signs for the state include "any resulting decline in reserves, increased debt and pension levels and/or growth in the structural budget gap," the report said.