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Mandates Relief for 89 Will Benefit 566
by William G. Dressel, Jr.
Executive Director, NJ League of Municipalities

In Trenton last Wednesday, the State’s Council on Local Mandates nullified provisions of the State Budget that would have required 89 municipalities to enter into ‘cost sharing’ agreements with the State Treasurer, in order to fund the State Police budget Failure to accept the Treasurer’s terms would cause a municipality to forfeit all or a part of its property tax relief funding.

In overturning this imposition, the Council rejected the State’s two main arguments regarding this unfunded mandate. The State, first, contended that the Constitutional prohibition on unfunded mandates did not apply to new costs imposed by the State’s Annual Appropriations Act. If the Council had accepted this radical doctrine, the State would be free to begin to impose new charges on property taxpayers in any or all of our 566 member municipalities, in order to fund other agencies of State Government, such as the Division of Local Government Services.

The State, further, argued that by setting aside any funding (In this case, $5 million in SHARE Grants was earmarked to assist the taxpayers saddled with the $12.6 million bill.), the State could exempt itself from the Constitutional ban. If the Council had accepted that argument, State legislatures and regulators would have been able to easily circumvent the will of the over-burdened property taxpaying people of the State, who amended their Constitution to curtail that practice.

The Council on Local Mandates was created when the people of New Jersey voted in 1995 to limit the ability of State government to impose unfunded mandates on local governments. The people endorsed the amendment because such mandates force municipal officials to increase local property taxes to fund, not local initiatives, but State established priorities. Prior to the Amendment, it was too easy for State officials to enact a policy to satisfy an interest group, and leave it to local officials to figure out how to pay for it. State officials took credit for the policy. Local officials got the blame for raising the necessary revenues through the only means available – the property tax. The Council, therefore, exists to protect our property taxpayers. Within the limits of its Constitutional responsibility, the Council has now done all that it can do to prevent this State mandated property tax increase.

The question now becomes, “Will the Administration and the Legislature respect the spirit of the Constitutional Amendment and of the Council’s decision?”

 

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