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GSCS On the Scene in Trenton: State Budget poised to pass late Monday...Cap Proposals, Opportunity Scholarship Act in Limbo
GSCS 'On the scene in Trenton' - On Wednesday the Senate Budget & Appropriations Committee passed the State Budget bill (S3000) and the Assembly Budget Committee passed its counterpart A3000 on Thursday.... S3000/A3000 are scheduled now to be voted on for final passage this Monday.....at the end of the week, the Senate Budget & Appropriations Committee also passed S29, Senate President Sweeney's 2.9% cap bill..... On Friday, the Assembly passed A3065 McKeon-Barnes which is the identical companion bill to S29. FYI S29/A3065, now poised for a final session vote this Monday, 'Reduces school district, county, and municipal property tax levy cap from 4% to 2.9% and permits unused school district, county, and municipal increases to be banked for three succeeding years' (Identical bill A3065 McKeon-Barnes).)...
GSCS 'On the scene in Trenton' - On Wednesday the Senate Budget & Appropriations Committee passed the State Budget bill (S3000) and the Assembly Budget Committee passed its counterpart A3000 on Thursday.... S3000/A3000 are scheduled now to be voted on for final passage this Monday.....at the end of the week, the Senate Budget & Appropriations Committee also passed S29, Senate President Sweeney's 2.9% cap bill..... On Friday, the Assembly passed A3065 McKeon-Barnes which is the identical companion bill to S29. FYI S29/A3065, now poised for a final session vote this Monday, 'Reduces school district, county, and municipal property tax levy cap from 4% to 2.9% and permits unused school district, county, and municipal increases to be banked for three succeeding years' (Identical bill A3065 McKeon-Barnes).)...
The Democrat's cap bill S29/A3305 is somewhat more responsive to concerns of schools than the Governor's 2.5% cap proposal in that it does allows for Commissioner cap waivers, however all waivers must be based solely on a district's "failure to meet core curriculum content standards [T & E];another difference is that this bill "eliminates the ability of a ...school district to submit a public question to the voters to exceed the allowable tax levy"; "in the case of a school district it would allow cap banking of any portion of the permitted 2.9% increase plus applicable adjustments not used by the school district in a budget year'; S29/A3065 also does not require a constitutional amendment, which should provide more flexibility to adjust to potential issues that may occur in the future; a notable difference from the Governor's proposal is that S29 focuses only on local spending, while the Governor proposals a corresponding 2.5% cap on state spending as well as local spending..... Some folks in the Trenton halls believe that the Governor will immediatley veto it S29/A3065 it if does pass.....GSCS has concerns about S29/A3065, in particular that it does not allow for a voter override, nor has its precipitous timing allowed for viable debate and analysis.....
Legislative leadership has talked of holding "hearings in July but with no specific mention of what bills could be heard then, including the Governor's cap proposal but we are hearing that is likely.....
FYI, as of Thursday night, the Opportunity Scholarship bill (S1872)- while the subject of heated, informal pro and con debate int the Statehouse all day Thursday - was not posted for a hearing, or a vote, in either house...
It remains to be seen what, if anything will come of S1872 this summer. For S29 Statement click here on
Statement on S29 - Senator Sweeney's 2.9% cap bill
Statement from bill S29 Sweeney/A3065 McKeon-Barnes: S29/Sweeney STATEMENT (Identical bill A3065 McKeon-Barnes) "This bill reduces the tax levy cap for school districts, counties, municipalities, fire districts, and solid waste collection districts from the currently permitted 4% annual increase to a 2.9% permitted annual increase. The bill also establishes the tax levy cap as the permanent mechanism for the calculation of the maximum allowable increase in property taxes that may occur between budget years. Under existing law, the 2007 tax levy cap law is scheduled to expire June 30, 2012. The bill narrows the purposes for which waivers to authorize the raising of additional tax levy may be requested from the Local Finance Board to only those purposes related to the provision of government services that the board deems essential to protect the public health, safety, or welfare. In the case of school districts, a waiver may only be requested from the Commissioner of Education for a district’s failure to meet the core curriculum content standards (thorough and efficient). The bill also eliminates the ability of a local unit or a school district to submit a public question to the voters to exceed the allowable tax levy. The bill would also permit levy cap "banking" of any portion of the permitted 2.9% increase under the property tax levy cap that is not used by a county or municipality in any budget year. In the case of a school district it would allow cap banking of any portion of the permitted 2.9% increase plus applicable adjustments not used by the school district in a budget year. Under current law, if a county, municipality, or school district does not use the entire 4% increase, perhaps because it uses surplus that year to keep tax rates steady, the difference is lost. This can be a problem in a succeeding tax year if circumstances require an unexpected increase in expenditures to maintain services. Under the bill, the cap is being reduced, but any unused permissible increase amount under the reduced levy cap limit could be used in any one of the next three succeeding budget years. This concept is similar to cap banking under the municipal and county appropriations cap law (N.J.S.A.40A:4-45.1 et seq.). Cap banking was also authorized under the statutes which established the formula for the calculation of a school district’s spending growth limitation, which was last operative in the 2006-2007 school year, and which is being repealed under this bill as the tax levy growth limitation becomes the permanent mechanism to calculate school district tax levy increases. The bill also deletes language in current law in order to eliminate a levy cap penalty that occurs when a county or municipality acts responsibly to reduce its debt servicing expenditures. The reduction in the property tax levy cap would be applicable to the local budget year next following enactment of the bill, and the opportunity to bank any unused portion of the allowable increase would commence in that local budget year so that any unused portion of the current 4 percent levy cap would not be available to be banked. The current levy cap, enacted in 2007, has been effective in holding down the rate of property tax increases. According to the information posted on the Division of Local Government Services website, the average municipal property tax bill rose 3.7% from 2007 to 2008 and 3.3% from 2008 to 2009. The tightening of the existing levy cap laws will act to further control such increases."
