THE LATEST: N.J. Democrats acting fast on $38.7B budget that defies Murphy. And now Republicans are praising them.

In the state budget they will unveil Monday, Democratic lawmakers reject Gov. Phil Murphy’s calls for tax hikes on millionaires and increased fees on gun owners, corporations, opioid manufacturers and bear hunters in New Jersey, NJ Advance Media has learned.

The Democrats who control the state Legislature have insisted they won’t support a millionaires tax, and their proposed $38.7 billion budget preserves just one of the Democratic governor’s proposed tax increases. They would raise a single tax — paid by HMOs — while taking money out of the state rainy day fund, cutting spending and tweaking revenue estimates for the coming fiscal year to balance the budget.

Their spending plan, as expected, breaks from the budget proposal introduced by Murphy in March. This is the second year state Senate President Stephen Sweeney and Assembly Speaker Craig Coughlin, both Democrats, have tried to block Murphy’s quest for a millionaires tax and defied his leadership by proposing their own annual budget for how the state government spends taxpayer money.

While Murphy says he wants to tax increase on income over $1 million to put the state on sturdier financial footing long term, lawmakers say they don’t need the revenue to balance next year’s budget and they won’t agree to the tax hike without cost-cutting reforms.

The Senate Budget and Appropriations Committee will take up the spending plan at its 2 p.m. hearing. Sweeney, D-Gloucester, and Coughlin, D-Middlesex, plan to hold votes on their budget Thursday, more than a week before the constitutional budget deadline.

It will then be up to Murphy to respond. He could negotiate with the Legislature, sign it, veto it in part, veto it in whole or refuse to act altogether. Several of those actions would put the state at risk of another government shutdown.

A senior administration official said last week “all options remain on the table.”

Sweeney said Monday at the Statehouse that lawmakers will consider overriding Murphy “If the governor did line-item and it was something of substance that matters to the members in my house or the speaker’s house.”

“I don’t know why the governor wouldn’t sign the bill. It’s a Democrat budget. It’s done by Democrats. It addresses a lot of the priorities the governor has," he said. “I would expect the governor to support the budget.”

While also making cuts, the Legislature’s budget adds more than $150 million for legislative priorities, including $50 million more for NJ Transit — on top of $25 million in new cash proposed by the governor — and $50 million for the state to begin picking up more of the cost to local school districts of providing extraordinary education, according to a person familiar with the budget who spoke on the condition of anonymity, and budget documents obtained by NJ Advance Media.

It adds millions to fund wage increases for direct support professionals who assist people with intellectual and developmental disabilities, and for employees at subsidized child care centers. It tacks on $48 million to study and provide grants toward municipal shared services, a priority for the Senate president and governor, and school consolidation, documents show.

They offer $18 million more toward the Senior Freeze property tax relief program and would expand the veteran property tax deduction, which is expected to cost $23 million.

The Legislature’s proposed tax relief contrasts with Murphy’s pledge to provide 2 million taxpayers a $125 tax credit if lawmakers agreed to the millionaires tax, which his administration estimated would generate $536 million.

The add-ons also include tens of millions of dollars in smaller grants to projects and programs across the state, including $3 million to the Turtle Back Zoo, $750,000 to the East Brunswick Senior Center, $5 million to Cooper University Hospital, millions more for higher education and $14 million to extend postpartum Medicaid coverage to six months. First Lady Tammy Murphy has focused on reducing maternal mortality rates in New Jersey.

The Legislature also wants to delete much of the $33.5 million in additional funding Murphy wanted to expand his free community college initiative, though they’ve proposed raising the income limit from $45,000 to $65,000 in hope that more students will qualify for aid, documents show.

They plan to pay for all these changes by, in part, raising estimates of how much money the state will collect in taxes next year — a maneuver Murphy’s administration is likely to dispute. For all of last year’s budget drama, much of it broke down over disagreements over number crunching revenue estimates, and these alterations are ripe for a redux.

While Murphy’s state Treasury Department thinks the state is going to lose out on more than $1 billion next year from businesses cashing in on corporate tax credits, the lawmakers’ proposal would revise that, projecting optimistically they’ll lose $175 million less than Murphy budgeted, according to the source.

They’re also counting on reaping another $100 million from a one-time tax on repatriated foreign earnings.

Plans to allow people purchasing lottery tickets to pay with debit cards would bring in another $25 million, according to a legislative source.

The differences between the governor’s and the lawmakers’ budget demonstrate the deep divide among Democrats on fiscal matters. As Murphy, undeterred, promotes the millionaires tax with assists from a deep-pocketed political action committee and passionate public-labor unions, Sweeney is urging cuts to public workers’ pension and health benefits to lower government costs.

The backdrop to this budget brouhaha is an all-out political war over the state’s corporate tax break programs, which will expire at the end of the month. George Norcross, a South Jersey power broker and close Sweeney friend and ally, filed a restraining order against a task force convened by Murphy to investigate whether tax credits doled out to businesses to stay in or move to the Garden State were improperly awarded.

Norcross, has declared all-out war on Murphy, calling him a “liar” and “politically incompetent.”

Murphy last week threatened to veto legislation approved in Assembly committees that would extend the controversial economic development programs through January.

Samantha Marcus may be reached at smarcus@njadvancemedia.com. Follow her on Twitter @samanthamarcus.

Brent Johnson may be reached at bjohnson@njadvancemedia.com. Follow him on Twitter @johnsb01. Find NJ.com Politics on Facebook.

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