Commentary: Property tax relief redefined | Commentary | -- Your State. Your News.

Jan 28th
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Commentary: Property tax relief redefined

house042909_optBY WILLIAM G. DRESSEL

The current recession has dealt a flurry of blows to New Jersey municipalities. As the foreclosure and unemployment rates rise, the tax collection rate falls.

As the economy stalls, new construction slows with it. As interest rates fall, the rate of return on our reserves falls with them.

This year's state budget proposal would cut municipal revenue replacement funding by about $32 million. Though never welcome, cuts of municipal property tax relief funding are no longer surprising — certainly not at this time.

However, they, inevitably, put upward pressure on property taxes. Still, the cash-strapped state can positively help our similarly cash-strapped property taxpayers. It won't cost the state a penny to relax or eliminate some of the many mandates that have been imposed, legislatively and administratively, over the course of decades. These mandates drive up the costs of local government and force local budget makers to address a laundry list of state priorities, before they can even begin to plan on how best to meet the local need for vital municipal programs and services.

Local officials want to do all that they can to contribute to our economic recovery. And the state can allow us to help, if it will heed our call for immediate mandates relief. At the outset of the budget discussions, we have identified a few areas in need of fast attention.

First, we call for a dramatic reform of the state's binding arbitration law, which forces local officials to submit police and fire contract disputes to the decision of an independent arbitrator. This process has consistently given the police and fire unions raises exceeding increases in the cost of living. And its ripple effect has led to excessive increases in the salaries of virtually all other local employees. Studies and surveys have consistently identified binding arbitration as the biggest driver of municipal costs.

Second, a whole host of state agency mandates force local governments to delay action on necessary improvements. These delays will, most likely, delay the effective use of whatever federal stimulus funding that trickles down to local governments. Accordingly, we ask that any permit application not denied for specific reason within 90 days of submission be deemed approved. And we further ask that a municipal engineer's certification of the subsequent remedy of defects be sufficient for permit approval.

Third, there are various training and certification requirements, which have been put in place by assorted state offices and agencies, over the course of decades, for a range of local officers and employees,. These include training for police officers and dispatchers on the use of Automatic Electronic Defibrillators; and bi-annual gas mask fit testing for officers and dispatchers. In these trying fiscal times, it would be appropriate to allow local policy makers to determine who needs to be trained in what area, how often and in what manner. Accordingly, we ask for the elimination of these, and other, training and certification requirements. That, instead, they be issued as advisories and that local officials be directed to perform a risk assessment, and to devise and implement a plan to meet their individual needs in the most cost effective manner possible.

Fourth, regarding a number of land use and environmental regulations, such as the six year cycle for Master Plan review/reexamination and the Stormwater Management programs, we will ask the state to postpone enforcement of these mandates, until such time as the state can meet its statutory responsibility to fully fund the Consolidated Municipal Property Tax Relief Fund and the Energy Tax Receipts Property Tax Relief Program. If circumstances beyond its control prevent the state from honoring its self-imposed statutory mandates, local officials should be excused from compliance with onerous state imposed program requirements.

Fifth, the League seeks relaxation of the inordinate steps and time limits with which municipalities must comply to institute layoffs.  If this is the last means of compliance with the tax levy cap and loss of revenues, the state should permit more expeditious actions to effect layoffs.

As the budget process unfolds, we will find other mandates that could be lightened or eliminated to help us contain property taxes. We trust the Legislature will seize this opportunity for meaningful and lasting mandates relief. We are eager to work with all interested in delivering on the promise of true property tax relief, as the budget process moves forward.

The recent decision of the Civil Service Commission to allow local governments to implement employee furlough plans proves that at least some in state government see the need to allow local leaders some flexibility, in our current crisis. Governor Corzine led the push for the furlough rules, so we know where he stands. Now we need to see if the Legislature is able to appreciate the problems we face, and if it is willing to give us some tools we can use.

William G. Dressel is longtime executive director of the New Jersey State League of Municipalities.


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