Beware those who embrace simple solutions. Yet, the simple solution is exactly what some op-ed writers, business advocates and legislators are now embracing. They say that the property tax problem is simply solved by attacking home rule. Consolidation saves money, they argue. Businesses have successfully merged entities, saved money and continued quality service. Why can't government do the same? Remove home rule, they say, force towns to consolidate and, the savings will result. This is a compelling but superficial argument.

Local governments must change the way they do business, they say.

Well, it would be much easier for local governments to do this if the State upheld its end of bargain, and maintained aid to municipalities, at the very least, to the rate of inflation. State government relies on the sales and income taxes, which automatically adjust to inflation. The private sector has the option of increasing its prices. Local governments are forced to rely on the regressive property tax to support services to residents.

And, it would be easier to change the way local governments do business if labor costs did not drive up local budgets every year. In the private sector, businesses have the option to negotiate changes with their workforce. In the public sector, there is significantly less flexibility to do so, and we must rely on an arbitration system that is weighted heavily in favor of public sector unions.

Consolidation saves money, they proclaim.

We agree that regionalization and service sharing present excellent opportunities for local savings. That is why so many municipalities have been involved for so long in so many such arrangements. Unfortunately, there are many impediments for larger scale sharing of services, such as the labor contracts and civil service requirements that make the sharing of big-ticket items inefficient and ineffective. For instance, under current law if two municipalities wanted to merge their public works departments and one is a civil service municipality and one is not, the one that is not must guide its workers into and through the civil service system. In these circumstances, consolidation would not save money. While sharing of services may reduce costs, the blanket statement that consolidation of services always saves money is plainly false.

The evidence we have seen is that interlocal services may generate modest savings. For instance, a 2003 report from Rutgers, the State University found that reducing the number of school districts in the State in half (a tall order to begin with) would result in a $365 million savings after 4 years. This is a good savings no doubt, but a drop in the bucket in the big picture, and would barely make a dent in the property tax crisis in which we find ourselves.

Furthermore, how will the quality of services be impacted? We recognize that the efficiency of service delivery must be continually improved. But how will the effective delivery of these services to our residents be impacted? That's more difficult to quantify.

Home rule is a myth. It doesn't really exist. There's no constitutional or statutory basis for home rule in New Jersey, they assert.

This is not true. Article IV, Section VII (11) of the State Constitution and the Home Rule Act of 1917 (NJSA 40-42 et seq.) provide for reasonably strong Constitutional and statutory foundations for home rule in New Jersey.

Defenders of home rule are just zealously protecting their own fiefdoms, they exhort.

What some call fiefdoms are democratically elected governments. Home rule is self-determination: locally elected officials are held directly accountable by voters. Those who resist sharing of services must defend that to their neighbors who voted them into office. And procedures, albeit difficult ones, to consolidate municipalities are already on the books, subject to the approval of voters. The State Legislature would do us all a disfavor by substituting their judgments for those of the citizens of the State. Diminishing home rule disenfranchises voters.

Of course, the State Legislature has failed to enact a citizens' convention, refusing to allow the public to have its chance against the property tax monster. Now some want to further erode voter participation by reducing local control.

So, let us present an alternate theory: the property tax crisis we find ourselves in has little to do with home rule.

Instead, the State Legislature should focus on the burdens and mandates it imposes on local governments. For instance, as Governor Corzine rightly noted in his address to the Legislature, state aid to municipalities has been flat for 5 years. This failure to even keep up with the rate of inflation has burdened local budgets.

Labor costs continue to strap local budgets. For instance, in its recent series, "Runaway Pay," the Bergen Record rightly called public employee compensation "the biggest reason for our fiscal woes." The Record's focus on teachers and public safety officers sheds light on the major problem facing local elected officials and the property taxpaying citizens that they have sworn to serve.
On Monday, July 31, local officials were informed by the Division of Pensions that 2007 property tax contributions to PERS and PFRS will total $650 million. That will mean $267 million in new spending, over which local officials will exercise no control, next calendar year.

We support shared services. And if two or more municipalities want to voluntarily consolidate, we'll do everything we can to make it work. In fact, it's part of the League's mission to make such efforts work well. Home rule is not an impediment to these efforts. It just assures that the final arbitrator is the voter. We trust the voters and the local officials to act on their behalf and we don't presume to substitute our judgment for theirs. Instead, it's time for the Legislature to recognize all of the complex factors that have contributed to this crisis - including its own actions and omissions. And it's long past time for progress towards a comprehensive solution.

William G. Dressel, Jr.
Executive Director,
New Jersey State League of Municipalities