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March 13, 2012

LEAGUE ASKS SENATE COMMITTEE TO RESTORE ENERGY TAX FUNDING

Dear Mayor:

Today in Montclair, the Senate Budget and Appropriations Committee began consideration of the Governor’s proposed State spending plan for the Fiscal Year beginning on July 1. League of Municipalities’ President, Mayor Art Ondish of Mount Arlington Borough, was among the first to testify. (Mayor Ondish's Testimony)

Mayor Ondish urged the Committee “ … to begin to end the State’s chronic dependence on local revenues to balance its budget. We want you to begin to restore to local budgets the dollars that have been diverted for many years to State purposes.”

Taxes on gas and electric utilities were formerly collected by the host municipalities.  When the State made itself the collection agent for these taxes, it promised to dedicate the proceeds to municipal property tax relief. For years, though, State budget makers have diverted funding from Energy Taxes to fund State programs.

“Instead of being spent on local programs and services and used to offset property taxes,” Mayor Ondish noted, “the money has for the past ten years, and for many years before that, been spent as successive Legislatures and Administrations have seen fit. 

“The cumulative impact of years of underfunding has left many municipalities with unmet needs. Whether related to deferred investments in local infrastructure, the loss of public safety personnel, dangerously low fund balances, or any other local need, local elected officials are in the best position to decide the best use for these resources. Further, these monies were always intended to fund local programs and services.”

Mayor Ondish asked the Committee to acknowledge, “ … the amount of utility tax money distributed to municipalities for property tax relief has shown little, if any, growth for the past twenty years. The proceeds going to the State’s budget, however, have grown significantly.

“The revenues are coming in. The taxpayers are paying the taxes. The diversion hasn’t saved them a penny.

“The diversion of our municipal resources to cover State spending needs to end. We call on you to provide us with this important tool to relieve the worst-in-the-nation property tax burden borne, for too long, by the people of New Jersey.”

It is important now for all Mayors to add their voices to this effort.   Please contact your State Senator to express your strong support for the restoration of these vital property tax relief dollars.

For more information, visit our Energy Tax Restoration Resource Center at http://www.njslom.org/energy-tax-resource-center.html.  

Also, please see the column authored by Mayors Mironov of East Windsor and Bencivengo of Hamilton in Tuesday’s Star-Ledger regarding Energy Tax Restoration: http://blog.nj.com/njv_guest_blog/2012/03/nj_must_stop_swiping_property.html

If you have any questions, contact Jon Moran at 609-695-3481, ext. 121 or jmoran@njslom.com

Very truly yours,

William G. Dressel, Jr.
Executive Director

 

 

 

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