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1-8-07 Articles & Editorial talk about 'missing pieces' of tax reform proposal and note consequences
Corzine to focus on propertytax - Aim is to jump-start reform package Asbury Park Press on 01/7/07 “…One key piece of reform, a long-awaited new school funding formula, has been absent from recent public discussions. The plan may not be ready for the next round of school budgets, Corzine, Roberts and Codey all said, frustrating some lawmakers."That's a horrible possibility," said Sen. John Adler, D-Camden, who was co-chairman of a property tax reform committee that examined school funding. He called the new formula "by far the most important part of property tax reform."..."Taxpayers have waited a long time, and waited too long for government to finally address the school funding issue. Another year delay would be an absolute slap in the faces of all of us as taxpayers and a tremendous disappointment to those of us in the Legislature," Adler said…”

Property taxes balloon despite push to reform Average bill in N.J. increases 6.8% Star Ledger, Sunday, January 07, 2007

"On the one hand, they say we must run municipal government in a smart business-like fashion and on the other hand, they hamstring us with level funding and they do nothing legislatively to deal with the cost-driving issues," Dressel said.

Star Ledger, Sunday 1-7-07 Editorial - Let localities help the taxpayers save

“…Currently about 40 percent of the 610 school districts and 55 percent of the 566 municipalities participate in the State Health Benefits Plan. They must accept whatever the state works out at the bargaining table with the unions and then figure out a way to pay for it. Variations aren't allowed."

Expect plenty of turnover in state Senate and Assembly GANNETT STATE BUREAU, January 8,2007 "...We'll just have to see if that type of sentiment plays out in New Jersey, both depending on what the Legislature does and the way voters sort of take that practical approach as to who they're going to support..."

 

Expect plenty of turnover in state Senate and Assembly

Posted by the Asbury Park Press on 01/8/07

BY GREGORY J. VOLPE
GANNETT STATE BUREAU

TRENTON — Although it remains to be seen whether Democrats' efforts to deal with rising property taxes will placate or enrage voters this year, it's already clear there will be several new faces sworn in to the state Senate and Assembly by this time next year.

Longtime Sen. William L. Gormley, R-Atlantic, announced last week he will not seek another term, ending a nearly three-decade run as one of the Legislature's strongest personalities. He was shortly followed to pasture by Assemblyman Steven J. Corodemus, R-Monmouth, who was seen as a front-runner to replace retiring Sen. Joseph A. Palaia, R-Monmouth.

Sen. Robert Martin, R-Morris, announced months ago he would not run, and Sen. Martha Bark is also expected to be off the ballot this year, meaning the Senate Republicans — the oldest of the Legislature's four caucuses — could lose more than 70 years of legislative experience among those four.

Such is the state of New Jersey politics, where age, frustration and political whims could have more of an impact on the future of the Legislature than property tax relief, the front-burner issue on lawmakers' agenda for the past six months.

There's a good chance that next year's roster could eclipse the number of new members — about six per election cycle since the 1980s, excepting years when there was a change in the district maps — usually seen after an election.

"There'll be more turnover than we've seen in recent years," Rider University political scientist David Rebovich said. "At this time, it looks like the turnover will be largely volunteer, rather than incumbents being ousted in the general election."

When Corodemus bowed out after 15 years, he cited frustration with political scandals and how partisan politics have stymied progress. Assemblyman Joseph Cryan, D-Union, the state Democratic Party chairman, said he wouldn't be surprised to see others cite similar reasons for retiring from state office.

"I think there's a frustration in the process, and I would imagine there will be others that won't be running as well," Cryan said. "They'll make their announcements in due time."

Other factors will affect the face of the Senate next year. One is Newark, where Democrats Sharpe James and Ronald Rice are not expected to survive now that a political foe, Cory Booker, also a Democrat, has taken the reins as mayor. Another is intraparty challenges such as in Hudson County, where Assemblyman and Union City Mayor Brian Stack, D-Hudson, is expected to topple Senate Majority Leader Bernard Kenny Jr., D-Hudson.

Camden could be a place of interest, where longtime lawmaker Wayne Bryant has recently filed to collect an $83,700 annual pension from four public jobs — including his state Senate post. That move doesn't prevent him from running, but Bryant is under federal investigation for a no-work job at the University of Medicine and Dentistry.

Once the field clears by the primary, the onus will be on Democrats who will hold the fundraising and incumbency edge — a 22-18 majority in the Senate and a safe 49-31 edge in the Assembly.

Republicans will try to convince the public that the Democrats' plan to reduce property taxes — which is still being finalized — will once again fail taxpayers. One political observer suggested property taxes in New Jersey could be similar to the war in Iraq nationally, which crippled Republicans last year, costing them control of both houses of Congress. Such a drastic transformation is not expected in Trenton.

"There really was unhappiness with people's performance," said Rutgers University political scientist Ingrid Reed of last year's congressional races. "We'll just have to see if that type of sentiment plays out in New Jersey, both depending on what the Legislature does and the way voters sort of take that practical approach as to who they're going to support."

That will be the Republican game plan, said state Republican Party Chairman Tom Wilson.

"The outcome of this election depends to a great degree on how successful we as Republicans are in creating a statewide message and a statewide environment — similar to what the Democrats did last year nationally — that focuses on two simple ideas: property tax reform and government reform," Wilson said.

Legislative leaders also expect some new faces in the chamber.

"You're going to see tremendous turnover. I don't think there's any question about it," said Senate President Richard J. Codey, D-Essex, who last week announced plans to pass a package of budget, ethics and government reforms.

"Certainly there will be new members of the Senate, and I hope that the new members will serve with the same distinction that Senator Gormley and other senior members have served," said Senate Minority Leader Leonard Lance, R-Hunterdon.

One other matter to watch is the impact politically powerful public-employee unions will have. Though there's been no official battle cry against specific lawmakers, those who stood front and center saying that tax relief requires fewer benefits for public employees will be targeted.

"We're actually working on that right now," said Carla Katz, president of Local 1034 of the Communications Workers of America, the largest state-employee union with 9,000 state workers. "We certainly have issues with legislators on both sides of the aisle that have attacked public employee benefits and looked to scapegoat our members, and we haven't come to hard and fast decisions yet, but we're in those discussions."

Gregory J. Volpe: gvolpe@gannett.com

Corzine to focus on property tax

Aim is to jump-start reform package

Posted by the Asbury Park Press on 01/7/07

BY JONATHAN TAMARI
GANNETT STATE BUREAU

“…One key piece of reform, a long-awaited new school funding formula, has been absent from recent public discussions. The plan may not be ready for the next round of school budgets, Corzine, Roberts and Codey all said, frustrating some lawmakers.

"That's a horrible possibility," said Sen. John Adler, D-Camden, who was co-chairman of a property tax reform committee that examined school funding. He called the new formula "by far the most important part of property tax reform."

"Taxpayers have waited a long time, and waited too long for government to finally address the school funding issue. Another year delay would be an absolute slap in the faces of all of us as taxpayers and a tremendous disappointment to those of us in the Legislature," Adler said…”

 

TRENTON — Gov. Corzine will try to spur action to rein in property taxes Tuesday when he delivers his first State of the State speech.

Although governors often use their annual addresses to pitch new initiatives, Corzine's speech is expected to focus on renewing efforts that bogged down late last year.

"He will take stock of where we are and indicate that we have some unfinished business," Assembly Speaker Joseph J. Roberts Jr., D-Camden, said.

With legislative elections looming in November in which all 120 Senate and Assembly seats will be decided and property taxes consistently named New Jerseyans' top concern, the political stakes could hardly be higher for the state's ruling Democrats.

Corzine, Roberts and Senate President Richard J. Codey, D-Essex, said last week they have broad agreement on several key proposals, including a 20 percent property tax credit for most homeowners, a 4 percent cap on annual property tax increases, increased oversight of school spending and efficiencies in local government. The task now is to move the plans through the Legislature, where the ideas stalled in December.

"We have a concept that we believe works and we can sell," Corzine said Wednesday.

One key piece of reform, a long-awaited new school funding formula, has been absent from recent public discussions. The plan may not be ready for the next round of school budgets, Corzine, Roberts and Codey all said, frustrating some lawmakers.

"That's a horrible possibility," said Sen. John Adler, D-Camden, who was co-chairman of a property tax reform committee that examined school funding. He called the new formula "by far the most important part of property tax reform."

"Taxpayers have waited a long time, and waited too long for government to finally address the school funding issue. Another year delay would be an absolute slap in the faces of all of us as taxpayers and a tremendous disappointment to those of us in the Legislature," Adler said.

Education costs account for the bulk of property tax bills, making the formula a major reform element. Corzine said he remains committed to creating a new formula, but that delivering one for the next set of school budgets is not "essential."

Roberts said lawmakers believe a careful review of the plan is most important.

"What's key with the new school funding formula is that there be a very thorough public discussion of it," Roberts said.

Corzine, Codey and Roberts all said schools could still receive additional aid while the administration works on the new formula.

Republicans have chided Corzine and his fellow Democrats for not acting faster on tax reforms.

"We have to address the property tax issue, and we have to do it immediately," said Senate Minority Leader Leonard Lance, R-Hunterdon.

Others question whether the proposal that would have the largest immediate impact on tax bills, the $2 billion tax credit plan, will last.

"The taxpayers of New Jersey want a property tax cut that will be substantial and sustainable beyond this year," Assemblyman Francis Bodine, R-Burlington, said.

Democrats expect to use the existing $900 million property tax rebate program and half of the recent sales tax increase — about $700 million per year — to pay for most of the credits. As the situation stands, that would leave a $400 million hole after the program's first year, when a timing quirk makes two years of sales tax revenue available.

Codey and Roberts said they expect cost-saving reforms to help close the gap.

They also expect a 4 percent cap on annual property tax increases to keep levies in check and have tied the idea, which has met resistance, to the credit program.

Some 100 mayors are expected to attend Corzine's speech at the Trenton War Memorial building, in part to oppose the caps. Advocates for local government say the proposed limits will force cuts in valuable services.

"It's going to mean wholesale cuts in personnel and services," said William Dressel Jr., executive director of the New Jersey State League of Municipalities.

An effort to use the state's toll roads as leverage for a cash infusion is another item likely to make Corzine's agenda this year. Corzine hopes the plan will reduce state debt and free up money for other priorities — possibly school funding.

With Sen. Joseph Vitale, D-Middlesex, and other lawmakers working on ambitious plans for widespread health coverage, Corzine also may touch on that issue Tuesday. Corzine has championed universal health care in the past.

A plan for a comptroller to monitor government spending, another Corzine campaign priority he has linked to property tax relief, is expected to advance in the Assembly Monday, a day before he speaks. The Senate plans to act on a measure to make school budgets easier to decipher. Those steps would help inch along property tax reforms even before Corzine speaks.

Property taxes balloon despite push to reform

Average bill in N.J. increases 6.8%

Sunday, January 07, 2007

BY JOE DONOHUE AND ROBERT GEBELOFF

Star-Ledger Staff

 

“…William Dressel, executive director of the New Jersey State League of Municipalities, said the 6.8 percent increase in property tax bills did not surprise him. He credited local officials with preventing taxes from climbing higher given that municipalities have received little new state funding for five years; during that time, insurance costs have soared and police and fire salaries have risen about 4.5 percent annually.

"On the one hand, they say we must run municipal government in a smart business-like fashion and on the other hand, they hamstring us with level funding and they do nothing legislatively to deal with the cost-driving issues," Dressel said…”

As lawmakers scrambled to enact a property tax reform plan last year, the problem grew by a record $1.4 billion, a Star-Ledger analysis has found.

Local government agencies hit landowners with a $20.9 billion levy in 2006, of which $15.4 billion was billed to homeowners. That pushed the average residential tax bill up 6.8 percent to $6,170 -- an increase of $390.

In the mid-1990s, the state's property tax levy -- the total amount collected to run local government and schools -- took three years to rise by a similar amount. But with costs increasing and aid from Trenton relatively flat, local officials have passed more than a billion dollars of their costs onto landowners every year since 2002.

The largest increase prior to 2006 was $1.2 billion in 2003.

State leaders say they are painfully aware taxpayers are feeling the pinch and that they must act soon to adopt both immediate relief and longer-lasting reforms.

"It's got to get done, plain and simple. No ifs, ands or buts about it. The quicker the better," said Senate President Richard Codey (D-Essex), who said he hopes a comprehensive set of reforms can clear the Legislature within six weeks.

In 2000, only six communities had an average property tax bill over $10,000. Now, homeowners in 55 towns can expect to pay five-figures to support schools, police and other local services, according to the analysis.

The average annual tax increase in the state has hovered between 6 and 7 percent for five years now, more than double the rate of inflation -- a trend that Jerry Cantrell of Randolph finds "completely unacceptable."

"Given they are more than double the cost of living increase, this policy is effectively creating a statewide inflation spiral," said Cantrell, president of Silver Brigade, a mostly senior citizen group dedicated to property tax reform. "Our government continues to spend at rates outpacing the private sector and the nation as a whole while private sector salaries are remaining relatively flat."

Assembly Speaker Joseph Roberts (D-Camden) said the relentless increase shows the need for a 4 percent cap on annual spending. "I know the average property tax bill has been hovering at around $6,000 for a number of years and that is clearly moving in the wrong direction. I think more than anything this shows the need to cap the growth in government spending," he said.

The Star-Ledger analyzed tax rates collected from 21 county tax boards and the tax assessments of more than 3 million individual real estate parcels. Among the other findings:

·  More than 273,000 individual homeowners now pay $10,000 a year in property taxes -- up from 72,000 in 2000.

·  Homeowners in affluent Millburn pay the highest average bill -- $16,511 -- but the average bill increased by 10 percent or more in 94 towns last year.

·  Among municipalities with the 25 highest bills, 10 are in Bergen County, while six are in Essex County. Bergen County residents had the highest average bills -- $8,404 -- with Essex County taxpayers paying only slightly less at $8,262. South Jersey residents received the smallest bills, with taxpayers in Cumberland County paying the lowest average: $3,021.

Since the start of a special session in July, Gov. Jon Corzine and legislators have been wrangling over a plan to provide immediate relief from the nation's heaviest property tax burden while also establishing a long-term strategy for slowing tax increases.

The short-term fix is a tax credit of up to 20 percent for those earning $100,000 or less, with smaller reductions for those earning between $100,000 and $250,000.

With all 120 lawmakers seeking reelection this year, Roberts said the Democratic majority hopes to enact the tax credit soon, even though Corzine has expressed concerns about how to pay for the $2 billion-a-year program in the future.

"We are looking for this to be passed in the Legislature early in the year," Roberts said. "People will see relief in their August tax bill. That is our plan."

A Corzine spokesman said The Star-Ledger's analysis reinforces the governor's belief in the need for a cap on yearly property tax increases.

"These numbers are exactly why Governor Corzine has been fighting for a 4-percent cap on annual increases," said spokesman Anthony Coley. "A 4 percent cap will make property tax reform sustainable and lasting, and New Jersey homeowners deserve and expect just that."

Lawmakers will act on other parts of the property tax plan as early as tomorrow, when the Assembly takes up bills to encourage local consolidation, including a commission to encourage mergers of municipal services, and the creation of an independent state comptroller.

Republicans eager to win back one or both houses made it clear they will keep the heat on until something gets done.

"The Legislature promised New Jersey property tax relief but failed to enact any substantial reform," said Assemblyman Guy Gregg (R-Sussex). "Where is the alleged relief everyone was supposed to get?"

William Dressel, executive director of the New Jersey State League of Municipalities, said the 6.8 percent increase in property tax bills did not surprise him. He credited local officials with preventing taxes from climbing higher given that municipalities have received little new state funding for five years; during that time, insurance costs have soared and police and fire salaries have risen about 4.5 percent annually.

"On the one hand, they say we must run municipal government in a smart business-like fashion and on the other hand, they hamstring us with level funding and they do nothing legislatively to deal with the cost-driving issues," Dressel said.

Former state Sen. William Schluter (R-Hunterdon), co-chairman of Citizens for the Public Good, a coalition of good government groups that support a citizens property tax convention, said a convention is the only hope for real reform. Even a 20-percent credit is unlikely to calm taxpayers for very long, he said.

"They will change property taxes to what they were three years ago," Schluter said. "Were people happy with their property taxes three years ago? No."

Joe Donohue may be contacted at jdonohue@starledger.com or (609) 989-0208. Tom Hester contributed to this report.


______________________________________________________________________________________

Star Ledger, Sunday 1-7-07 Editorial - Let localities help the taxpayers save

 

“…Currently about 40 percent of the 610 school districts and 55 percent of the 566 municipalities participate in the State Health Benefits Plan. They must accept whatever the state works out at the bargaining table with the unions and then figure out a way to pay for it. Variations aren't allowed.

 

If a school board wants to negotiate higher co-pays or re quire employees to contribute to health coverage costs, it can't. Or if a town wants to provide an incentive for an employee to opt out of the state plan because he is covered by his spouse's plan, it can't.

 

None of that makes any sense, especially when the task of finding ways to limit property tax increases falls on mayors and school board members.

 

So if the bill is objectionable, why not tailor new legislation to give mayors and school boards the power to gain even more tax savings for homeowners? …”

 

 

The calculus for controlling property taxes is complex, involving a series of fixes that each attack a contributing cause. Placing reasonable caps on tax increases, providing more state aid, reining in public employee benefits and requiring consolidation of school districts and even municipalities must all be part of the equation.

 

The need to use every tool available has never been greater. A Star-Ledger study found that it cost $1.4 billion more last year than the previ ous one to run local governments and schools. That comes to $390 per home, pushing the average New Jersey property tax bill above the $6,000 mark -- $6,170 to be exact. And there's one more troubling stat: In 2000, homeowners in only six towns were paying an average of more than $10,000. Last year 55 towns exceeded that number.

 

Obviously, politicians in Trenton are central to the effort, but so are mayors, town council members, freeholders and school board members who draw up the budgets that determine tax rates. But cur rent law doesn't allow local officials to be treated as equals in the quest to stunt property tax growth.

 

It's illogical for Statehouse policy designers to adopt a strategy that ignores requests by local officials to have a more expansive array of options for controlling costs.

 

As part of a four-month review of the Hydra-headed property tax problem and what could be done to limit future increases, four legislative committees issued 98 recommendations and then drafted bills to implement many of them. Among them was a measure that would have given local officials the power to negotiate the details of health benefits with unions representing county, municipal and school employees. Amazingly, that is something they can't do. Placing that power in the hands of local officials could save millions.

 

Currently about 40 percent of the 610 school districts and 55 percent of the 566 municipalities participate in the State Health Benefits Plan. They must accept whatever the state works out at the bargaining table with the unions and then figure out a way to pay for it. Variations aren't allowed.

 

If a school board wants to negotiate higher co-pays or re quire employees to contribute to health coverage costs, it can't. Or if a town wants to provide an incentive for an employee to opt out of the state plan because he is covered by his spouse's plan, it can't.

 

None of that makes any sense, especially when the task of finding ways to limit property tax increases falls on mayors and school board members.

 

A bill that would grant the locals that authority was sidelined when Gov. Jon Corzine basically dismissed much of the work done by the four legislative committees by saying all employee benefits should be handled through contract negotiations, not through legislation. While he says he supports the idea of allowing localities to do their own bargaining, there were other provisions in the bill that he opposed.

 

The New Jersey School Boards Association has compiled statistics showing districts that dropped out of the state program and went on their own were able to reduce costs through negotiations with local unions.

 

West Orange saved $2 million over the course of a three- year contract by encouraging employees who could get coverage under a spouse's policy to do so. The state plan does not allow that.

 

Perth Amboy's teachers will pay 25 percent of their health insurance costs, and Somerset Hills and Hillside negotiated a contract that places new employees in a less expensive managed care plan for at least their first three years on the job.

 

The governor recognizes that lowering health care costs will provide the most significant and immediate budget savings. And any cost conces sions he can wrangle from the state unions will benefit towns and school boards in the state plan.

 

So if the bill is objectionable, why not tailor new legislation to give mayors and school boards the power to gain even more tax savings for homeowners?

 


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609-394-2828



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