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This Special Session Joint Committee held its first opening hearing yesterday. Legislators comments revealed that their focus is already narrowed to finding ways to merge school districts and to merge municipalities, and their various services. There was talk of forcing that consolidation too. It is notable that many schools already share services and would welcome enabling statutory latitude to do more sharing and also to find more ways to cut costs. For schools for example, it would help if the state did not mandate dual spouse coverage for employees covered under the state health benefits plan. But the state has chosen to restrict schools in that way, even though towns and counties and higher education insitutions do not have the same requirement imposed on their entities. GSCS is wary of the committee's rather preordained approach here, while real cost drivers are seemingly put on the side. It is with particular interest that we read Star Ledger writer Tom Moran's article today that exposes the reality underlying their premise that merging local government units will provide meaningful property tax reform. Read to see what Moran concludes, bolstered by New Jersey local government expert Ernie Reock's [emeritus/Rutgers] take.
Star Ledger - "To this expert, home rule is not the devil of Jersey taxpayers"
Wednesday, August 09, 2006 , Tom Moran Star Ledger staff
Sen. Robert Smith gave his gavel one crisp whack to announce the start of his war against rising property taxes. This man meant business.
The key to winning this fight, he said, is to attack the tradition of home rule that has chopped
Each has the power to raise property taxes. And each has its own little bureaucracy to feed, in a school, a town or a fire district. On the opening day of hearings into local government consolidation, Smith was identifying his villain.
"Home rule was a great 19th-century concept," he said. "In the 21st century, it has led to the highest property taxes in the nation."
This is an article of faith in
The problem is it's not really true.
At least that's the view of the only man who has looked hard at the actual numbers, former
"There is money to be saved, but it's not very much," he says. "I guess I'm a skunk at this party."
Reock may be the state's leading authority on local government. For 32 years he was the director of
Now 81, he still swims laps regularly and still shows up most days at his cramped office in downtown
Reock speaks softly. You get the impression he doesn't want to be the skunk at the party. It's just that he's a trained academic, and that's where the facts took him.
"I went back to the 1940s with all the data we have," he says.
Reock first took a hard look at the issue when talk about the costs of home rule boiled up in the 1990s. He looked at the data on school spending, which absorbs the bulk of property tax revenue.
What he found is that most of the money goes to teacher salaries and benefits, which would not be affected by mergers.
When he examined towns that had agreed to share a high school -- just the sort of move that was supposed to save money -- he found their per-pupil spending actually increased for some reason.
Larger districts did tend to save some money on administration. But even if the state went on a merger binge and reduced the number of districts by half, the costs savings would be modest.
Reock puts the number at $365million. Which sounds like a lot until you realize it amounts to less than 2 percent of the state's property tax bill.
The entire savings, in other words, could be gobbled up three times by the average annual increase in property taxes.
Even Senator Smith, despite the grand talk, says he would consider a savings of $500million to be a "terrific success."
Yes, that's better than nothing. And Reock agrees that it makes sense to move in this direction.
But if you want to find the real action on property taxes, you have to pick a different legislative committee. There's one on the lavish benefits we provide to public workers, which could yield larger sav ings. And another on school funding, which is the biggest of all.
Politicians prefer to talk about home rule because it seems to suggest we can control property taxes without real pain. We don't need to increase class sizes or give up services. We can just slice off a layer of unneeded bureaucracy.
This won't be so easy.
"People think this is a silver bullet. But you're not going to solve the property tax problem this way," Reock says.
"Maybe I'm just cynical. But maybe I'm realistic."
Tom Moran's column appears Wednesdays and Fridays. He may be reached at tmoran@starledger.com or (973) 392-1823.
Lawmakers look at consolidation
Posted by the Asbury Park Press and other Gannett newspapers on 08/9/06
BY JONATHAN TAMARI
But one former official who tried to trim expenses through consolidation said those plans often fail, or produce only small gains.
"I count myself an advocate of shared services, but I've seen as many failures as successes, especially when the big-buck services are included," said Regan Burkholder, a former municipal administrator who has worked on shared services in
As an example, Burkholder told lawmakers on a committee studying government consolidation that six months of work to coordinate with towns around
Burkholder said it would likely take "coercion," rather than incentives, to save the kind of money that would make a dent in property taxes. He compared shared service deals to sand castles: "Lots of work, undone in a moment."
Democrats and Republicans on the joint committee studying government consolidation, however, said fewer administrators would mean less costs to taxpayers.
Sen. Robert Smith, D—Middlesex, the committee's co-chairman, said
"I believe that maintaining our current system of 616 autonomous districts is inefficient and wasteful, and it only promotes duplication and inequality," Smith said.
But Lynne Strickland, executive director of the Garden State Coalition of Schools, said parents enjoy hands-on, local control.
"They like the sense that they can walk in the door and talk to teachers up to the superintendent and have a viable hand in their kids' education," Strickland said.
The New Jersey School Boards Association said there are pitfalls to consider.
"We don't want to sound obstructionist. We do support consolidation," said NJSBA spokesman Mike Yaple. "But it should lead to educational and economic benefits, and any shift to a county-wide system should be decided by the voters."
Yaple said more than half of school districts save money by not joining the State Health Benefits Program and could pay more if forced to join it. And if districts merge, he said, state law requires the larger district's union contract to be the one used — even if its salaries are more generous and therefore costlier to taxpayers.
"The biggest obstacle would be apportionment — how much each community pays," Yaple said. "When school districts regionalize, the amount they pay changes. So it's a virtual given that one town's taxes will go down, and another town's taxes will go up. The Legislature has always had the ability to consolidate school districts by legislative fiat, and the fact that they haven't done it recognizes some of the very real concerns that taxpayers would have."
Several lawmakers pointed to
"We can no longer ignore the fact that our state has become a bureaucratic nightmare," said Sen. Joseph Kyrillos Jr., R-Monmouth.
Members of the Somerset County Business Partnership, which helps coordinate government cooperation, said they have had some success in slashing that bureaucracy.
In 2005, partnership officials said, they saved
"Shared services is a means to hold back the deluge. It is a patch on a broken system," said Gregory Bonin,
Bonin said existing laws provide significant obstacles to contracting government.
When Branchburg tried to work with the county health department, for example, he found that existing laws would have made the change more expensive, not less.
Assemblyman John Wisniewski, D-Middlesex, the committee's co-chairman, said the panel will explore ways to make consolidation easier and encourage cooperation that will streamline government, despite likely opposition.
"This committee was not created for the purpose of winning a popularity contest. It was created for the purpose of initiating and executing change," Wisniewski said.
The
"We believe in self-determination," said the league's executive director William Dressel Jr.
Tax-cut panel focuses on consolidation
Special legislative committee seeks mergers among municipalities and school districts
Wednesday, August 09, 2006
BY TOM HESTER
Star-Ledger Staff
Lawmakers looking at ways to cut property taxes warned local officials yesterday they should prepare for a future of less government and less spending.
"All constituencies and interest groups need to be brought to the table and have a reality check," said Assemblyman John S. Wis niewski (D-Middlesex), co-chairman of a special committee looking at government consolidation and shared services, which held its first meeting yesterday in Trenton.
The state's 616 school districts are clearly in the sights of Sen. Bob Smith (D-Middlesex), the panel's other co-chairman.
"I call it the Willie Sutton theory: That is where the money is," said Smith, paraphrasing the infa mous bank robber of 1930s and 1940s. "Sixty-five percent of local property tax dollars go into the schools. That is 616 bureaucracies, 616 school superintendents, 616 lawyers, 616 purchasing departments. It is crazy."
The six members of the Joint Committee on Government Consolidation and Shared Services, one of four panels leading a special ses sion on property taxes, vowed to examine ways to reduce the 1,389 governments and agencies that have the power to levy taxes in New Jersey. That breaks down to 21 county and 566 municipal governments, the 616 school districts, 186 fire districts and 300 local authorities.
Assemblyman Robert M. Gor don (D-Bergen) indicated that the examination could reach as far as the hometown firehouse.
"Little
Smith said he intends to push his idea of establishing 21 county school districts. In each, one staff of administrators would oversee the operation of existing school districts, purchasing, transportation and health and insurance costs while allowing the schools to retain their hometown identity.
It dovetails with legislation sponsored by Assembly Speaker Joseph Roberts (D-Camden), who wants to create 21 "super" superintendents appointed by the governor who would have the power to promote shared services and approve school budgets and local superintendents' contracts and salaries.
Smith said 11 states have some sort of county-based school systems.
"
The New Jersey School Boards Association said no more than 58.9 percent of property taxes -- about $11 billion -- goes for school costs. Mike Yaple, a School Boards Association spokesman, said the group does not oppose school consolidation as long as it is approved by voters and can be shown to reduce taxes for all districts involved.
Wisniewski said the committee also will examine streamlining more than 200 state laws and civil service statutes that may impede local government consolidation or shared services, as well as the possible elimination of state government agencies that are no longer needed.
Robert H. Levin, chief of the state Office of Legislative Services' Local Government Section, told the committee that threatening local government with a "stick" to combine could violate the constitutional standard of "state mandate, state pay."
The last time towns consolidated was in 1995, when Paha quarry became part of Hardwick in
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Following article re: Joint Committee on Public Employee Benefits Reform, meets in
