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January 13, 2009
Trenton, NJ

New Jersey League of Municipalities Reacts to State of the State

Today in Trenton, Governor Corzine delivered the annual State of the State address to a joint session of the legislature. His next major policy pronouncement will be his Budget speech in March. Anticipating that presentation, the Governor suggested we should be prepared for further State spending reductions. Municipal property tax relief funding could again face significant cuts. Those cuts will likely come whether or not the Governor’s pension payment deferral proposal passes.

Accordingly, it appears that the only form of ‘property tax relief’ that we can hope for from Trenton, this year, is the ‘pension payment deferral’ proposal, embodied in S-7. The League agrees that the cause of property tax relief cannot be abandoned, even, in fact, especially, during our current troubles. Accordingly, we sincerely appreciate this effort.

The Governor also will direct DCA Commissioner Doria to have the Local Unit Alignment, Regionalization and Consolidation Commission (LUARCC) submit formal shared service and consolidation proposals to the legislature by March 31.We question the practicality of this time-frame and hope the Commission will resist pressure, in this election year, for a rush to judgment. Precipitous action could saddle our fellow citizens with an ill-advised arrangement for years to come.

The Governor further called on COAH, “to allow for maximum flexibility and ample time for collaborative review” of the plans submitted by the December 31 deadline.   Further, the Governor called for a one-year moratorium on the assessment of the 2.5% non-residential development fee (i.e., the commercial development fee.)     A stay of this fee, however, should go hand-in-hand with a stay on the accruement of a affordable housing obligation that results from commercial development.   Otherwise, funding sources for affordable housing, which were already inadequate, will be further diluted and the taxpayers would again be forced to make up the difference.    If and how this would affect the housing obligations assigned by COAH as a result of commercial development is not yet known. Still, we appreciate the Governor’s attention to the need for administrative flexibility in the current economic climate.   The League will continue to work with the Administration, Legislature Leadership and Senators Lesniak and Bateman and will closely monitor the specifics of this initiative.

Further, the Governor renewed his dedication to the arbitrary and artificial 4% levy cap. The only cap relief the Governor intends to make available is that included in S-7, the pension payment deferral proposal. We regret this position and oppose the cap, which distorts rational budgetary planning.

Concluding, the Governor observed, “Today, we must stand together. In ordinary times, ours is a tough job ... but these are no ordinary times. Given the magnitude of the national economic crisis, the challenges we face are unprecedented and daunting.”

We agree on the need for mutual respect and cooperation in the face of the current crisis and stand ready to work with the administration and the legislature, on a bi-partisan basis.

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For further information contact: William G. Dressel, Jr., Executive Director at (609)695-3481, extension 122 or 609-915-9072.




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