Governor Corzine has offered a serious budget that seeks to address the state’s severe structural budgetary deficits. It includes some troublesome spending cuts and tax increases. As always, the first concern of local officials has to be property tax relief funding.

  The good news is that formula funding will not be going down. So, you can anticipate the same amount you received in FY ‘06 through the Consolidated Municipal Property Tax Relief Act (CMPTRA) funding program, through the Energy Tax Receipts Property Tax Relief (ETR/PTR) program, through the Legislative Initiative Block Grant (Per Capita) Aid program, and through the Municipal Homelands Security Assistance program. In other words, no cuts in general formula aid programs.

The bad news is twofold. First, Extraordinary Aid funding, which is annually awarded, based on need and the availability of funding, will be cut from $43 million in the current Fiscal Year, to $30 million for FY ‘07. That means fewer municipalities will get this emergency funding and that those who do may get less than they need. Second, for the fifth straight year, local property taxpayers will be denied the benefit of annual inflationary adjustments that are required by state statute in both CMPTRA and ETR/PTR funding. In the 1990s, Legislators in both parties and in both Houses recognized that increases in prices, wages and employee benefits would erode the ability of local officials to keep a lid on property taxes with “level funding.”

We appreciate the problems that are being faced by the Administration and by the Legislature, as they struggle to responsibly close a massive, inherited deficit. We only hope that they, likewise, recognize how “level funding” contributes to the problems being faced by local budget makers and the property taxpayers, whom they have sworn to serve. We also appreciate the Governor’s renewal of his promise to advance the cause of long term property tax reform, as soon as an agreement is reached on the FY ‘07 spending plan.

We will need to be on guard against those in the Legislature, and elsewhere, who refuse to acknowledge the connection between “level funding” and inflation, on the one hand, and rising property tax bills, on the other. Some find it easier to call for forced consolidation of municipalities and school districts, than to seek meaningful property tax reform.

Editorial from New Jer

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EXECUTIVE DIRECTOR'S MESSAGE FROM 407 WEST STATE STREET   Budget News The Good and the Not So Good Governor Corzine has offered a serious budget that seeks to address the state’s severe structural budgetary deficits. It includes some troublesome spending cuts and tax increases. As always, the first concern of local officials has to be property tax relief funding.   The good news is that formula funding will not be going down. So, you can anticipate the same amount you received in FY ‘06 through the Consolidated Municipal Property Tax Relief Act (CMPTRA) funding program, through the Energy Tax Receipts Property Tax Relief (ETR/PTR) program, through the Legislative Initiative Block Grant (Per Capita) Aid program, and through the Municipal Homelands Security Assistance program. In other words, no cuts in general formula aid programs. The bad news is twofold. First, Extraordinary Aid funding, which is annually awarded, based on need and the availability of funding, will be cut from $43 million in the current Fiscal Year, to $30 million for FY ‘07. That means fewer municipalities will get this emergency funding and that those who do may get less than they need. Second, for the fifth straight year, local property taxpayers will be denied the benefit of annual inflationary adjustments that are required by state statute in both CMPTRA and ETR/PTR funding. In the 1990s, Legislators in both parties and in both Houses recognized that increases in prices, wages and employee benefits would erode the ability of local officials to keep a lid on property taxes with “level funding.” We appreciate the problems that are being faced by the Administration and by the Legislature, as they struggle to responsibly close a massive, inherited deficit. We only hope that they, likewise, recognize how “level funding” contributes to the problems being faced by local budget makers and the property taxpayers, whom they have sworn to serve. We also appreciate the Governor’s renewal of his promise to advance the cause of long term property tax reform, as soon as an agreement is reached on the FY ‘07 spending plan. We will need to be on guard against those in the Legislature, and elsewhere, who refuse to acknowledge the connection between “level funding” and inflation, on the one hand, and rising property tax bills, on the other. Some find it easier to call for forced consolidation of municipalities and school districts, than to seek meaningful property tax reform. A united effort at all levels of government to lower our regressive property taxes would be good news indeed.       Editorial from New Jersey Municipalities, Volume 83, Number 4, April 2006