newjerseynewsroom.com

BY WILLIAM G. DRESSEL, JR.

COMMENTARY

Due to a lack of action on the proposed 2.5% Constitutional property tax levy cap, in late June Governor Christie called the Legislature into a "Special Session." When the Session convened on July 1, the Governor stated his intent to have the Legislature continue to meet until property tax solutions are in place. He included, among those solutions, the 33 initiatives of his "toolkit."

This is the third major attempt at property tax reform in the last decade. We continue to hope that it will prove more successful than the previous two.

In 2004, Governor McGreevey's "FAIR" (Fair And Immediate Relief) plan included relief for our hardest hit taxpayers; stricter spending caps; and a plan to advance towards a Citizens' Convention for Property Tax Reform. Today, all that remains of that plan is the caps. In 2006, Governor Corzine's Special Session for Property Tax Reform produced property tax credits that have vanished, and property tax levy caps that have been tightened.

It has now been over two months since Governor Christie signed the new 2% levy cap into law. At that time, he recognized that ‘toolkit' management reforms and mandates relief had to be passed to make the cap workable. It now appears that inertia has set in. Agreement on management reforms and mandates relief has NOT been reached. And we believe that Governor Christie and the Legislative Leadership must break the log-jam.

The longer we wait for reforms and relief, the greater the likelihood that other matters will distract State level policy makers and divert their attention away from these pressing needs. We have seen this happen with previous efforts directed toward property tax reform. We believe that we are beginning to see this process at work in Trenton, yet again.

All around the State, responsible municipal officials have begun planning their 2011 budgets. At this point, those plans MUST account for the new cap. At this point, those plans must be based on the assumption that meaningful management reforms and mandates relief initiatives will NOT be in place. At this point, those plans must also be based on the further assumption that next year's State budget will not provide statutorily required revenue replacement funding.

Mayors, Governing Bodies and Administrators will do whatever they can to prevent negative outcomes. Under current assumptions, and with no meaningful management reforms, we anticipate service cuts, lay-offs and furloughs, depleting service to taxpayers all around the State. These consequences will delay efforts to foster our State's economic recovery.

These results may be unavoidable in 2011. Going forward, the situation can only improve IF serious reforms are enacted and unfunded mandates are relieved or repealed. Attention to the Binding Interest Arbitration mandate should top the list of State priorities for meaningful property tax relief.

Meanwhile, the Legislature, which held some hearings and meetings on management reform and mandates relief over the summer, is now holding hearings on other priorities and other bills. And the Governor has begun a new series of town hall meetings, promoting a new series of reforms.

Where are the major toolkit tools that were supposed to help local officials control run-away costs? Where is arbitration reform? Where is civil service reform? Where are the mandates relief measures? State policy makers need to advance management reforms and mandates relief initiatives that will allow municipalities to continue to deliver vital services and programs to their citizens and businesses, despite the caps - and despite continuing cuts in municipal revenue replacement funding.

New Jersey citizens are sick of paying the highest property taxes in the Nation. The new 2% levy cap will only slow the spread of the disease. It is not the cure. Yet, after two ‘special sessions' within four years, that's the best that we've gotten from the Trenton establishment. But the special session, convened in July to take action on a toolkit, has not finished the work it began. State leaders must seize this opportunity to finally deliver significant and sustainable relief and reform.

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

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