A recent Star-Ledger editorial boldly proclaimed: “Christie tax plan helps the rich; Sweeney’s cut helps middle class.” Of course they were talking about the competing tax cut proposals put forth by the Governor and the Senate President.
While the numbers they reported may be accurate—
middle class tax payers will get a bigger cut under Senator Steve Sweeney’s plan than the one put forward
by Governor Chris Christie—the editorial makes one huge factual misstatement.
It claims that “Sweeney is delivering an actual property tax cut.” That is patently false. What he proposes is expanding the property tax credit on New Jersey income tax returns. If Senator Sweeney’s tax cut proposal is passed, no one’s property tax bill will go down.
To be fair, Senator Sweeney has supported real reforms to New Jersey’s tax structure in the past, but he had his hat handed to him. That was back in 2006, when then-Governor Jon Corzine called a special session of the legislature to tackle this problem.
In one instance, Sweeney supported pension and benefit reform legislation but had the rug pulled out from him by the very same governor who called on the Legislature to act.
In an even more high profile move, Sweeney proposed using Gloucester County—where he was also Freeholder Director at the time—for a pilot program to consolidate school districts. When he called a public meeting to discuss the idea, the NJEA showed up. The plan was DOA.
Based on these experiences, perhaps Senator Sweeney can be forgiven for being a little gun shy in calling for real property tax reform. But the current proposal is not going to reduce the burden on local governments or enable them to lower property tax bills.
Governor Christie, on the other hand, has had some success in this area. He can claim credit for a 2 percent cap on property tax increases and a number of cost containment measures. Less than a year ago, though, he was still urging the legislature to act on the remaining items in his “toolkit” package.
However, something happened when the calendar turned to 2012. The governor dropped his call for legislative action. An outsider listening to both his State of the State and Budget addresses this year could have walked away thinking that property taxes really aren’t a big deal in this state.
They are. In a recent Monmouth University poll, 42 percent of New Jersey residents named property taxes as one of the most urgent issues facing the state. A similar number also named jobs, but no other issue came close—not income taxes, education, transportation, or corruption. Keep in mind that the poll did not prompt people with these choices. In other words, nearly 3 million residents are consciously thinking to themselves, “Will they ever do something to lower property taxes?”
While property taxes have been an issue for decades, it’s important to note that public anxiety has never been as widespread and intense as in recent years. Even renters—who never see a property tax bill—prefer a property tax cut over an income tax cut. The bottom line is that the state’s property tax burden hampers economic growth for all residents.
Unfortunately, the actions necessary to tackle the property tax problem are not on the table right now. All eyes are turned to upcoming elections with the 2013 Gubernatorial election and 2014 U.S. Senate contest shaping 2012 state policy decisions.
Confronting property taxes requires a hard look at how we fund certain services at the county, local, and school levels. It requires fundamental reform.
The Governor never ascribed to this approach. Going back to the 2009 campaign, candidate Christie focused more on income tax cuts, saying that property taxes could be brought down through cost containment alone. On various occasions, he said structural reform was either a last resort or simply not a consideration.
The Governor and Senate President are banking on the notion that no one, especially local officials, really wants fundamental reform. They are banking on the fact that politicians and citizens alike will be frightened off by the large number of unknown factors.
Will fundamental reform undermine the delivery of services? Will it alter Constitutional guarantees? How will public education—the biggest draw on the property tax pot—be funded? Will property tax reform threaten “home rule?”
These are all valid questions. But New Jersey is at a crossroads. These are questions we must be willing to address in a candid and forthright manner.
As it stands now, local governments will continue to get squeezed—forced to cut valuable services that will increase disparities in the state’s communities. And still, there is no doubt that Garden State property taxes will continue to rise. While an argument can be made that the rate of increase is now under control, the public does not consider the current situation to be satisfactory.
Taking on the state’s more pressing issue will require a concerted effort—and no uncertain amount of political courage—on the part of state and local leaders. Only then will property taxes be treated honestly as the top item on New Jersey’s policy agenda.
Patrick Murray was named the founding director of the Monmouth University Polling Institute in 2005. In that short time, the Monmouth University/ New Jersey Press Media Poll has established itself as the Garden State’s “poll of record” for its in-depth tracking of public policy and quality of life issues. The Institute has also conducted polling in seven other states.
In 2010, PolitickerNJ.com named Mr. Murray “Pollster of the Year” and he has appeared on their New Jersey Power List of the 100 most politically influential people in the state for the past two years. He frequently appears as a commentator on state and regional TV and radio, and has also appeared on national media, including CNN’s The Situation Room and ABC’s Good Morning America. During federal election years, he serves as a national exit poll analyst for NBC News.
Originally published in New Jersey
Municipalities, Volume 89, Number 5, May 2012