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February 21, 2008
Re:

Upcoming Budget

 

 

Dear Mayor:

Next week, on February 26, we will get our first look at Governor Corzine’s budget proposal for the State’s next Fiscal Year. Based on his commitment to ‘freeze’ overall State spending, the Governor has warned us that discretionary spending will need to be slashed by at least $2 BILLION.

Since all Municipal Property Tax Relief funding has been regarded, in the past, as discretionary, despite statutory requirements to the contrary; and since that funding has often been ‘frozen,’ even when OVERALL State spending has increased; absent assurances to the contrary, we need to fear cuts in Municipal Property Tax Relief funding in the upcoming budget and in all future years.

Governor Corzine has acknowledged that flat funding of municipal property tax relief programs in an inflationary environment is, in fact, reduced funding. He said just that in 2006 Budget Address and in his Speech opening the Legislature’s Special Session for Property Tax Reform, later that year. Yet this budget proposal could mark the seventh straight year, in which the New Jersey Legislature adopts an Appropriations Act that under-funds key municipal property tax relief programs (CMPTRA and Energy Taxes). State statutes require annual inflationary adjustments in those programs. For five years, funding remained flat. Then last year, this municipal property tax relief funding finally increased – by 2%. By adopting these budgets, our local property taxpayers have been denied about $300 million of relief, over the past six years. That money went to fund other State priorities - priorities other than property tax relief.

No one level of government can be reasonably blamed for the entirety of our current property tax crisis. There is more than enough blame to share. But officials at every level of government in New Jersey need to focus on doing all that they can to deliver meaningful and consistent property tax relief and reform to our long-suffering fellow citizens. And a failure to fully fund municipal property tax relief at, at least, the statutorily specified levels will indicate that officials at the State level have clearly lost that focus.

We will provide you with on-going analyses of State budget developments over the upcoming months, beginning with a look at the Governor’s proposal early next week.

 

                                                                        Very truly yours,

 

                                                                        William G. Dressel, Jr.
                                                                        Executive Director

 

                       

 

 

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