On May 25, Assembly Speaker Craig Coughlin unveiled the "Stay NJ Act" property tax relief plan, a comprehensive initiative designed to alleviate property taxes for seniors while also addressing the affordability of healthcare insurance and prescription drugs.
The "Stay NJ Act" establishes a property tax credit program aimed at making property taxes more affordable for senior citizens, enabling them to remain in their homes. Under the program, eligible claimants who are 65 years or older and own a primary residence in New Jersey will receive a property tax credit equal to 50 percent of their property tax bill. There is no income limit for eligibility, and the maximum credit per tax year is set at $10,000.
If a property taxpayer is eligible for both the ANCHOR property tax rebate and the homestead property tax reimbursement, they will receive the greater of either the Stay NJ credit or the combined amount of the ANCHOR rebate and homestead reimbursement. The Division of Taxation Director is required to create a single application form for residents to apply for the ANCHOR rebate, homestead reimbursement, and Stay NJ property tax credit. The Division of Taxation Director will determine which program provides the greatest benefit for each applicant.
The Stay NJ property tax credit will be divided into four tax year quarter credits and applied to the quarterly property tax payments. The State Treasurer will distribute the credit payments to municipal tax collectors on a quarterly basis, at least 10 days before each payment's due date. A dedicated non-lapsing account called the Stay NJ account will be created to hold the funds for the program's administration and payment of property tax credits. The bill appropriates $300 million in State Fiscal Year 2023 which will be increased in subsequent years to support the program. The implementation of the Stay NJ property tax credits will begin in the tax year quarter starting January 1, 2025.
Assembly Speaker Coughlin’s Plan also includes A-2 which, aims to improve access to healthcare by increasing the income eligibility threshold and eliminating the asset test for the Qualified Medicare Beneficiary (QMB) Program, the Specified Low-Income Medicare Beneficiary (SLMB) Program, and the Qualifying Individual (QI) Program. These programs, collectively known as Medicare Savings Programs, assist individuals with limited income and resources in paying their Medicare cost-sharing obligations. Currently, New Jersey follows federal guidelines in determining eligibility based on income and asset limits. However, A-2 grants the Human Services Commissioner the authority to implement a State Medicaid benefit that maximizes federal funding available under these programs, providing assistance to State residents enrolled in Medicare with incomes up to 200 percent of the federal poverty level (FPL) without considering their assets. The assistance covers Medicare Part A and B premiums, copayments, coinsurances, and deductibles. If federal regulations limit the provision of assistance under the SLMB and QI programs, the bill allows the Human Services Commissioner to establish a separate subprogram using State funds only. The Human Services Commissioner is also authorized to establish alternative income eligibility standards within federal requirements, provided it does not exceed 230 percent of the FPL. Importantly, A-2 does not permit the Human Services Commissioner to alter federal requirements beyond the flexibility provided by the federal government regarding income and asset eligibility.
Assembly Speaker Coughlin’s Stay NJ Package also includes A-3, which aims to revise the income eligibility criteria for the Pharmaceutical Assistance to the Aged and Disabled (PAAD) and Senior Gold Discount Prescription Programs in New Jersey. It proposes expanding the income threshold for PAAD to 400 percent of the federal poverty level and increasing the income threshold for Senior Gold to capture individuals above the PAAD limit. The bill also requires automatic enrollment in Senior Gold for eligible residents who purchase prescription drugs at participating pharmacies. The pharmacy would collect necessary information and issue program identification cards and NJSAVE applications. Individuals failing to submit the NJSAVE application within the specified timeframe will receive it by mail. These changes intend to improve access to prescription drug assistance for eligible individuals in New Jersey.
Governor Phil Murphy has expressed concerns about the NJ Stay proposal put forth by Assembly Speaker Coughlin. Murphy's office is reportedly preparing for a potential government shutdown as the deadline to sign the budget approaches. The Governor views Assembly Speaker Coughlin's "Stay NJ" plan as financially irresponsible, citing the program's cost of $1.7 billion and the absence of eligibility limits. With declining revenue projections for the next two fiscal years, Governor Murphy believes the tax cut proposal could jeopardize the progress made with rating agencies.
Contact: Andrew LaFevre, Legislative Analyst, 609-695-3481 x. 116, alafevre@njlm.org