2 percent cap on N.J. property tax hikes supported by Assembly Democrats

Wednesday, 07 July 2010 14:06

statehousenjgov010510_optSenate to vote on proposal Thursday


The Assembly Democratic majority Wednesday joined in supporting the 2 percent cap on annual property tax hikes and government spending agreed upon Saturday by the Senate Democrats and Republican Gov. Chris Christie.

Assembly Speaker Sheila Y. Oliver (D-Essex) said the proposal would be discussed Wednesday (CQ) an Assembly Budget Committee hearing in Trenton.

"The Assembly Democratic caucus β€” as it always does β€” had an energetic discussion about property tax reform and where New Jersey goes from here,'' Oliver said. "We believe the plan to cap increases at 2 percent and provide exceptions incorporates many of our ideas to control property taxes and is a significant change from the governor's initial plan. The proposal has our support.''

Oliver described the 4 percent cap implemented by Gov. Jon Corzine and the Democratic-controlled Legislature three years ago as a success and said she is confident a new 2 percent cap will help property tax payers.

We will take all thoughts concerns into consideration as we continually look to ensure the cap remains sensible," Oliver said.

No additional Assembly action on the proposal has been set. The Senate is prepared to hold a floor vote on the proposal (S-29) on Thursday.

On Saturday, after lengthy negotiations Senate President Stephen M. Sweeney (D-Gloucester) and Christie agreed on a 2 percent cap insread of a 2.9 percent version sent to the governor by the Democratic-controlled Legislature.

Under the proposal, there will be a so-called hard 2 percent cap that would have limited exceptions while giving local voters the ultimate decision making authority in whether or not the cap should be exceeded. The cap would need to be approved only by the Legislature and Christie and not voters statewide on the November ballot.

At the hearing, the mayors of East Windsor, Cherry Hill, Collingswood and Elizabeth joined Bill Dressel, director of the League of Municipalities to urge the legislators to focus on what they described as an immediate need to enact local government cost containment reforms.

"The Governor was right when he said, β€˜New caps without the toolkit are unworkable,' East Windsor Mayor Janice Mironov said. "Having reached agreement on unworkable new caps, the Trenton establishment needs to get serious about the struggle against oppressive, regressive property taxes. Local governments need to see action on the toolkit management reforms and on mandates relief initiatives before the governor signs any new caps. Local governments need assurances that the Trenton establishment will end the diversion of vital municipal revenue replacement funding, such as the Energy Tax, which was never intended for State use. Property tax reform takes more than caps and cuts."

Cherry Hill Mayor Bernie Platt told the committee, "Mayors throughout the state need real reforms to an antiquated property tax system that has not evolved in more than 200 years. We need significant management reforms that will give town halls throughout the state the flexibility to keep the cost of doing business lower and allow municipalities to preserve the health and public welfare of our residents. No elected official ever wants to raise taxes and imposing a cap without the proper vehicle to manage it will not build true property tax reform."

"The "toolkit" to help towns control personnel costs must require arbitrators consider the 2 percent cap and the cost of health care benefits," Collingswood Mayor Jim Maley said. "Because health care costs are outside the cap, they must be considered separate from the cap to allow towns to adequately control their costs."

Elizabeth Mayor Chris Bollwage said, "We need real solutions to real cost drivers, whether they are inside or outside any arbitrary cap. On pensions and health benefits, if employees are required to contribute a reasonable percentage of the actual costs of the benefits, then our citizens will see real, sustainable relief."

"Absent cost containment initiatives or an end to the diversion of municipal revenue replacement funding," Dressel said, "these new caps will only shift the burden of deciding whether to slash vital municipal services or increase property taxes from local elected officials to the citizens who elected them."

Assemblywoman Connie Wagner (D-Bergen) agreed with the mayors and Dressel.

"... This cap is just a piece, not a solution,'' she said. "Capping taxes that already too high provides stability, but not much more. That's why we really have to start looking hard at fixing New Jersey's over reliance on property taxes. To that end, I've signed on as a sponsor of a bill (ACR-102) that is designed to reduce the average residential property tax bill by about 25 percent. I hope this bill becomes a big part of our debate in the coming months as we continue working to bring real relief to taxpayers."

Assembly Republican Budget Officer Joe Malone (R-Burlington) said, ""The bipartisan agreement to place a hard cap on property taxes makes it imperative for us to go further and enact the rest of Governor Christie's proposals that will give local officials the ability to truly shrink the size of government and lower property taxes.''

Malone added, "We cannot afford to let this historic opportunity pass by now that there is finally bipartisan momentum to put the priorities of property taxpayers first."