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June 18, 2010

Re: Urgent Alert for Local Action: Legislators Again Seeking to Divert Municipal Energy Funds for State Budget

Dear Mayor:

PLEASE CONTACT YOUR STATE LEGISLATORS IMMEDIATELY! IF FUNDING RESTORATION IS NOT A PART OF THE BUDGET SENT TO GOVERNOR CHRISTIE NEXT WEEK, YOUR PROPERTY TAXPAYERS WILL, LITERALLY, PAY THE PRICE.

Only you can convince your Legislators to begin to deliver promised relief for your property taxpayers. And, with action on a State spending plan scheduled for next week, time is running out.

By now, we know of no one who disputes the fact that a law of the State of New Jersey requires annual inflationary increases to both Energy Tax Receipts Property Tax Relief (ETR) and Consolidated Municipal Property Tax Relief Aid (CMPTRA) funding.

If the State had complied with the law (and increased ETR and CMPTRA distribution by the rate of inflation in each year) from 2002 to 2012, then municipalities could expect to receive $2,258,890,000. If, however, the proposed budget is adopted, as is, the State-wide distribution would be $1,342,100,000. That would make this year’s annual funding gap over $916 million.

Further, we know of no one who denies that the sales tax was imposed on energy production and transmission and corporate taxes were imposed on energy providers, in order to replace revenues derived from Franchise and Gross Receipts Taxes that were originally collected by municipalities and were always intended for local use.

If the State budget under consideration is not amended, then according to the State Treasurer’s most recent estimates, it will be balanced by skimming $480 million, derived from the sales tax on energy production and distribution and corporate taxes on energy providers. 

Finally, we know of no one who disputes the fact that municipal property tax relief funding suffered actual cuts of over $26 million in 2008, $32 million in 2009 and $271 million in 2010.

Despite these facts, it now appears that the Legislature will not close the gap, nor end the skim, nor even begin to restore the $331 million it cut from municipal property tax relief funding in 2008, 2009 and 2010.

We understand that Legislators plan to introduce a budget that will provide for State tax relief, if revenue collections meet certain expectation. (See Press report on this at http://www.njslom.org/letters/2012-0618-energy-tax.html) Please urge them to take action on a proposal that would pledge restoration of municipal property tax relief dollars in this State Fiscal Year, if similar conditions are met.

If the State is prepared to promise State tax relief, assuming revenue projections prove accurate, then the State should be prepared to promise local relief under the same conditions.

PLEASE CONTACT YOUR LEGISLATORS TODAY AND INSIST THAT YOU EXPECT THEIR SUPPORT FOR THE THAT PROMISE.

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

Very truly yours,

 

Hon. Janice Mironov, First Vice President,
NJLM; Chairperson, Energy Receipts Restoration
Task Force and
Mayor, East Windsor Township

William G. Dressel, Jr.
Executive Director

 

 

 

 

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