Coming out of last year’s budget deadlock, no one could question the dedication of our State’s political leadership to property tax relief and reform. At Speaker Robert’s behest, one-half of the sales tax increase was set aside for that purpose. A Constitutional amendment was advanced, asking the citizens of our State to make that a permanent feature of all future State budgets. And the historic Special Session for Property Tax Reform, long a wish of Senate President Codey, was set in motion. In his July, 2006 speech opening the Special Session, Governor Corzine presented the Legislature with an ambitious blue-print for reform. The main message that the Governor sent to the Legislature was “The time has come.” 

Throughout the Fall and into the Winter, the Special Session’s four Joint Committees remained passionately focused on that long-elusive goal. The Committee Members, the partisan staffs and, as always, the non-partisan Office of Legislative Services dedicated countless hours and incredible energy to the cause. Any future effort to address the crisis will need to begin with a reconsideration of the record and recommendations of those four Joint Committees.

On January 9, property tax relief and reform provided the primary – and almost exclusive – focus of Governor Corzine’s annual State of the State address. The Governor expressed his hope that the Special Session process would end prior to the Legislature’s receipt of his budget proposal for our State’s next Fiscal Year. (It did not.) And he again indicated his commitment to a Citizens’ Convention, should this process not succeed in reducing New Jersey’s chronic over-reliance on regressive and excessive property taxes to fund essential government programs and services.

In that State of the State speech, the main message Governor Corzine sent to the people of New Jersey was, “The time is coming.” Pending the development of a new school funding formula and until New Jersey lowers its highest in the Nation over-reliance on property taxes to fund essential public services, from the current 45%, or so, to somewhere much closer to National average of about 30%, we continue to wait.

Last month, Governor Corzine signed the ‘caps and credits’ and the CORE reform bills, officially marking the end of the Legislature’s months long effort to end the property tax crisis. Our fellow citizens now know just what the Special Session has accomplished.

Realizing that more needs to be done for property tax reform, Assembly Speaker Joe Roberts and Majority Leader Bonnie Watson Coleman have advanced ACR-20, which would allow the voters to provide for the Constitutional dedication of another one-half cent of the sales tax to property tax relief. If the Legislature gives the voters the opportunity, we are confident that they will again make the best of it.

We know that there are those who support property tax relief, but who are uncomfortable with Constitutional dedication. We understand that. We only hope that they understand why municipal officials are uncomfortable WITHOUT Constitutional dedication.

Over the last century, many taxes that had been collected by local governments were either abolished or became State taxes. In most cases, when these changes were made the State promised to reimburse municipalities either the amount they had been collecting or the amount that the State would collect.  But that commitment has not always been scrupulously honored.

Further, in the 1990’s, Legislators in both parties and in both Houses recognized the fact that increases in population, prices, wages and employee benefits – increases over which mayors and governing bodies have little, if any, control - erode the ability of local officials to keep a lid on property taxes with “level funding.”

Appreciating that fact, they put laws on the books that were supposed to preserve the property tax relief benefits of at least these two programs, into the future, by adjusting annual relief by the rate of inflation.

According to State sources, in FY 2001, the State provided municipalities with about $1.604 billion in general property tax relief funding. In the State’s last full Fiscal Year (2006), the figure was around $1.693 billion. Though we appreciate the State’s struggle to provide a little more than a 5% increase in tough budgetary times; at about half the rate of inflation (11%), that’s hardly enough to help us to stem the rising tide of property taxes.

We understand the State's fiscal problems and did not ask the Legislature to honor its statutory commitment to full municipal property tax relief funding. Still, it is important to remember that, with the passage of the current budget, our local property taxpayers will have been denied $283.7 million of relief, over the past five years.

No matter how much you think government should spend; no matter where you think money is needed or money is wasted; no matter what the appropriate level of revenue we need to meet our responsibilities to the people who elected us, the simple fact of the matter is that there has to be a fairer way of raising it. THAT is the crying need of the property taxpayers of our State.

Accordingly, we fully support ACR-20. We sincerely hope that it will appear on this November’s ballot. We honestly believe that the voters need to be given at least this opportunity to advance the cause of property tax relief.