Muoio Moves a Step Closer to Formal Approval as New Jersey’s Financial Boss

John Reitmeyer | March 27, 2018 | Budget
Senate committee approves acting State Treasurer for the permanent position after grilling her about tax policy and spending

On raising the income ceiling, state Treasurer Elizabeth Maher Muoio has indicated Murphy administration willing to listen.
Acting State Treasurer Elizabeth Maher Muoio has already managed the release of Gov. Phil Murphy’s first state budget plan, and made a major decision affecting the public-employee pension system. But she’ll have to wait a few more weeks for her nomination to get a final review from the full state Senate.

Yesterday Muoio’s appointment to the state’s top financial position won the approval of the Senate Judiciary Committee, after she was interviewed by members of the panel for over an hour on issues related to tax policy, spending, and even her work on fiscal matters while serving as a member of the Board of Freeholders in Mercer County more than a decade ago.

Muoio is now on deck to be reviewed by the full Senate on April 12, during what is shaping up to be a busy week for the former state assemblywoman; she’s also scheduled to appear that week before the budget committees in both the Senate and Assembly to discuss the $37.4 billion budget plan Murphy put forward earlier this month.

“I’m looking forward to the vote on the 12th, and hoping for a great outcome,” Muoio said after her confirmation hearing ended yesterday.

If she does win the approval of the full Senate, Muoio will be just the second woman in the state’s history to have done so. But that milestone was the subject of an awkward moment that Muoio had to navigate during yesterday’s hearing, after Sen. Gerald Cardinale (R-Bergen) pressed her to further explain her decision to highlight that likely achievement during her opening statement. The first woman to win Senate confirmation for the treasurer position was Feather O’Connor Houston, who served in the administration of former Gov. Tom Kean Sr.

The question that drew audible gasps

“Do you believe that your gender makes you more qualified for this job? Your opening statement and the introduction seems to have indicated that, and I find that unusual because I thought that appointments were supposed to be judged on ability, not on the gender of the person being appointed,” Cardinale asked, drawing audible gasps from some in the audience.

“I think part of my point, and I didn’t say it, it’s actually a shame that I’m going to be, hopefully, the second confirmed woman treasurer in the state of New Jersey, in our 200-year history, it’s hard to imagine that there were not more qualified women that could have taken this post in 200 years, and I’ll be the second if I’m fortunate enough and blessed enough to receive the vote of both this committee and the full Senate,” Muoio said in response.

“That was my point, not that I’m more qualified, I just am proud to be able to sit here as potentially the second one, and wish I wasn’t just the second one because I know there are far more women who would have been qualified to take this position over the years,” she went on to say.

With more than 3,000 employees, Treasury is one of the state’s most important departments, overseeing an annual state budget of nearly $35 billion, and the day-to-day operation of the $77.5 billion public-employee pension system. Treasury also administers state property-tax relief programs and handles all major borrowing issues, among other responsibilities.

Pension-system tweak

Murphy, a Democrat, announced his selection of Muoio to fill the position of state treasurer in mid-December, and she’s been serving as acting treasurer since he was sworn into office in mid-January. During that time, she decided to ease a last-minute change made by former Gov. Chris Christie to the way the state projects long-term investment returns gained by the pension system. Citing a need for a more realistic assumed rate of return for pension-system investments, Christie lowered the rate from 7.65 percent to 7 percent in one immediate step. But Muoio has announced the state will gradually get to the lower rate over several years, starting with a drop to 7.5 percent.

Muoio has also been heavily involved in the rollout of Murphy’s fiscal year 2019 budget plan which calls for several tax increases and an overall $2.7 billion increase in spending.

Both the pension-system policy and Murphy’s budget proposal were the subject of questions posed to Muoio by members of the judiciary panel yesterday, including Sen. Kristin Corrado (R-Passaic). She specifically wanted to know if Murphy and Muoio had looked for places to cut spending in the budget before deciding to propose higher taxes and increased spending.

‘…cut to the bone’

Muoio said other department heads had been asked about the need for belt-tightening, and that some funding requests weren’t granted in the final budget. But she also said many departments had been “basically cut to the bone” by the Christie administration.

Corrado also pressed Muoio to explain her support for spending in Mercer County when she was a freeholder in the 2000s. Prior to joining the Assembly in 2015, Muoio served as a councilwoman in Pennington, and as a county freeholder in Mercer County, before holding a position as the county’s director of economic development and sustainability.

Corrado said an audit of Mercer County’s spending from Muoio’s freeholder days found some irregularities, and she asked Muoio what, if any role, she played in the problems detected by the auditors. Muoio said the spending plan in question was administered by the Republican county executive, and that meeting minutes from that time indicate she raised questions about issues covered by the audit. Those issues were ultimately resolved when a Democrat took over the county executive position in Mercer County, Muoio said.

“I’d like to thank you for bringing that up. I agree with you that that was a concern, and I’m glad you brought it to our attention,” Muoio told Corrado.