The League of Municipalities top legislative priority is the return of Energy Receipts property tax relief funding to local taxpayers. Our advocacy on this issue, spearheaded by League President Janice S. Mironov, Mayor of East Windsor Township, has led to unprecedented progress. Legislators on both sides of the political aisle now agree that this money does not belong in the state budget. This year, we hope to see the Legislature and Governor take the next step and include additional funding in the annual Appropriations Act. On this, and on other important issues in Trenton, your voice has been heard.
We’re also reaching out beyond Trenton to advocate for New Jersey’s municipalities. Many issues under consideration in our nation’s capital have the potential to affect our members. One current challenge is a common deficit reduction ‘solution” that could threaten property taxpayers: proposals to limit or eliminate Federal Income Tax Exemption for the interest earned on municipal bonds. President Mironov has written to every member of New Jersey’s federal
delegation, in both Houses of Congress, to oppose such a change.
By eliminating or severely limiting the exemption, the federal government could receive more income tax from bondholders. However, the change would significantly increase the cost to local governments. If the exemption is removed or limited, local governments will need to offer higher rates of return, resulting in greater expenses to build or rebuild roads, bridges, schools, libraries, water and sewer facilities, fire stations and fund other key projects. These projects are essential, if local governments are to meet the needs of families and businesses. In order to pay higher interest rates, New Jersey municipalities will be forced to either raise property taxes to cover the increased interest or forego needed investments.
If Congress and the President were to remove this common sense way to keep taxes lower—while producing work for local businesses, jobs for our citizens, and improving critical infrastructure—the costs of these projects will increase and property taxes will rise.
We encourage you to add your voice to the debate on these two critical issues. By supporting the return of the Energy Receipts and a continued federal exemption for municipal bond interest, you will be speaking out for the fair treatment of local government—and the citizens we represent
Editorial from New Jersey
Municipalities, Volume 90, Number 5, May 2013