There was a good deal of activity in Trenton today as the Governor called the Legislature in for a special session. At the beginning of the day, Governor Christie was demanding a 2.5% constitutional cap and the Senate wanted him to address them separately. By the end of the day, the Senate showed up for the Governor's speech and Christie was ready to go along with a statutory cap with less exemptions than Democrats proposed, rather than the constitutional cap. You can see 6 ABC's report on the day:So as the day ended, the question was what's next? Sweeney said that the Senate and Assembly will hold budget hearings tomorrow, but he would not call the full body into session:
"We're going to work very hard through the summer - through the summer, all through the summer. We're looking at every Thursday being in, bringing experts in, talking about real policy issues and how we can make New Jersey better," Sweeney said.
"We fulfilled our requirement constitutionally by being here, and he addressed us. The budget committee will be here tomorrow. If he wants, I'll be here Saturday, Sunday. I don't have a life. Honestly, I'll hang out with him in Trenton if he wants. But we're not calling our full Senate in over the weekend," Sweeney said.
"We believe the governor's constitutional authority means when he calls a session of the Legislature, that means the full Legislature. And he can do that as many days as he sees fit," Drewniak said.
"We would hate at this stage, given that we recognize the importance of the spirit of cooperation, to have to bring this to the attention of the attorney general and sue the Legislature to get them to meet their obligation," Drewniak said.
Governor Christie is betting that people don't agree with the governments they elected and therefore will go along with his proposal to cap property tax increases at 2.5% each year. He may be right, but what he's really doing is passing the buck and offloading responsibility. Christie is cynically taking praise for lowering taxes while forcing local governments to make the tough choices on spending.
He's basically saying, "I'm cutting your taxes but I will provide NO leadership on where you can and should cut spending. I want you to like me for saving you money and for you to hate your local officials for denying you services." Christie is taking an easy victory lap while passing the responsibility and blame associated with leadership on to local governments.
It's just like he's doing with the budget. He says he won't sign a budget that raises taxes, even though his budget has tax, fee and surcharge increases contained in it. But in addition to what is in the budget, he cuts funding at all levels forcing local governments to either make drastic cuts or take the hit which he's unwilling to take himself.
Now as the truth comes out, Christie is starting to say that the cap will force consolidation. Of course it will, because he's starving the beast without taking responsibility for the fact that Grandma Bess will be upset when the trash isn't picked up by the local garbage truck. But you notice he isn't pushing legislation to do that directly, because then he would have to take some blame when people are upset.
For all the talk of less government regulation and mandates, here you have the Governor dictating what local boroughs and townships can tax - isn't this just another unfunded Trenton mandate? Christie is hiding all the downside to his cap plan, setting up local government to eat all the consequences. That's Christie leadership.
The Governor and members of the GOP keep saying, and the mainstream media keeps repeating that Chris Christie won't sign a budget that raises taxes. But even Steve Lonegan knows that's a bunch of nonsense. Check out this quote about what Governor Christie is really doing:
"The idea that this Governor is cutting taxes and spending is a complete myth. New Jersey taxpayers are facing a massive $2.56B tax hike which is a direct result of this Governor's reckless cuts to state aid. Homeowners across the state are about to get slammed with one of the biggest property tax increases in state history. This Governor's budget is going to do untold damage to New Jersey's already fragile economy. People are going to be hurt."
Ut oh... Steve Lonegan said what Republicans, the press and even some Democrats aren't willing to say: "the emperor has no clothes." Christie can try to talk tough all he wants about campaign pledges and even use his shrill statements to veto taxes on his millionaire friends, but make no mistake - Governor Chris Christie is raising taxes.
Maybe Assemblyman DiCicco as a new legislator isn't familiar with how the idea of video works. See if you say something that they record on video and then do the opposite, that video will make its way out to the public for further questions. Check out this exchange from a May 5th town hall with Seniors in Gloucester Township and pay attention to how the Assemblyman answers the question he gets:So he says he disagrees with the Governor, attacks the proposals and says that's not how he was raised. But then Democrats gave DiCicco the opportunity to restore the property tax rebates for seniors by extending the millionaires tax. Instead of living up to his word by restoring the rebates, he turned around and voted against it with his felllow Republicans. District members Senator Madden and Assemblyman Moriarty didn't let DiCiccio's tall tale to seniors pass without offering this comment:
Said Moriarty, "He sold out to the governor and the super-wealthy and stuck everyone else with the bill."
Madden continued: "I am well aware that facts at times can come forth that would change a legislator's position. I firmly believe that based on the Assemblyman's sudden reversal on this major legislation, 12,000 plus seniors and disabled residents of the 4th District deserve to know why he withdrew his support for their most needed cause - the restoration of the rebates."
The most amazing part of the video is just how far apart DiCicco's statements and actions are. He attacks the proposed cuts as "going after Seniors" and expresses personal outrage by claiming he "wasn't raised that way" only to later on vote in support of the cuts he just finished slamming.
Chris Christie ran for Governor on a platform of change. And while there's certainly been change over the last 3 months, it isn't the kind of change that's necessary, or the kind many voters expected. Big campaign talk of real change to the budget and "shared sacrifice" quickly degenerated into a game of "us vs. them", and Christie's "us" are the super rich and corporations against seniors, children, teachers and students, and the middle class.
It's easy, and it's right, to criticize Christie for who he prioritizes in his cuts, and who he targets. But Christie still has the opportunity to really do something here to fundamentally alter the way NJ runs. He can still bring the real change the people crave. And he can do it by seriously addressing the gorilla on every New Jerseyan's shoulder: property taxes.
As Jason noted yesterday, even Christie admits now that property taxes will increase from his proposals. And there are 2 things that need to be accepted as true because, well, they are true:
I'm a tax guy professionally. Here are some real facts:
NJ's sales tax falls in the middle among the states. Ditto the state unemployment tax (the wage limit is high but the maximum and average rates employers pay are fairly low as compared to other states). State personal income tax is also in the middle among the states for most families. Gas tax? One of the lowest in the US. The fact that NJ's dead last in the country in the amount of money it receives from the federal government as compared to what its residents send is also a big issue. We'll leave that for another day.
Does a village like mine (Ridgewood) need local, county and state police, where there's very little crime? Same question for most towns surrounding mine. What about the extra cost reflected in property tax just to have our garbage collected from the sides of houses, instead of asking us to walk our pails to the curb? Do we need school districts with no schools? Or 600 municipalities with their own governments and duplication of spending all across the state? Or duplicate school administrations? How about the costly fire department equipment rarely used? Shouldn't we get better negotiated contracts binding together more purchasing power? Can we lower costs for many services spread over a larger population?
It's time for us and our elected officials to take a long hard look at the fundamental underlying problems and begin to address them in a responsible manner. Chris Daggett had an interesting proposal but it merely shifted the tax burden from property tax to sales tax - that doesn't go far enough to address the underlying issues. If Christie is really serious about bringing fundamental change to the way that NJ runs, then he has a tremendous opportunity before him. This is something he'd get support for from both Democrats and Republicans. And it would be right.
But if he chooses to continue to indulge in class warfare and employ misleading numbers from conservative think tanks, then he fails miserably at the one thing he has the opportunity to do well. Christie can leave his mark on New Jersey. He can change everything.
Well it's about time. Governor Christie was on with Don Imus yesterday and he made an admission that contradicts just about everything else he's said about not raising taxes:
On raising property taxes:
"We've got to put a cap on property taxes. We've got to get teachers' unions and others to step up to the plate and contribute and sacrifice. That's what we're trying to prevent. Some property taxes will go up but not nearly as much as they would have if people hadn't gone out and voted on Tuesday and voted 'no.'"
Oh, so some taxes will go up? I'm not shocked to learn that, but stunned to hear the Governor finally admit it:
On how much New Jersey property taxes will go up this year:
"Property taxes will go up a little bit this year, I don't think there is any doubt about that. It'll be under 4 percent."
I hope the media, who has continued to let Christie and his supporters parrot the talking point that raising taxes is not an option were watching.
"Taxpayers are furious by the inaction of the Legislature to address the crisis by passing Proposition 2 1/2," said DeCroce, referring to Gov. Chris Christie's proposal to place on the November ballot an amendment to the state constitution that would impose a hard 2.5 percent cap on the growth of budgets and property taxes.
That would be the proposal that hasn't even yet been drafted as a bill by the Christie administration or Republican lawmakers, which the governor first proposed in a March 16th speech, six days before the Senate and Assembly began their budget-review break
Set aside the policy arguments on the merits of a cap, it's pretty difficult to take action on something that isn't there. Next DeCroce can explain you pass a bill that doesn't exist yet. Maybe taxpayers are also furious at the grandstanding of the politicians like DeCroce too.
Bret Schundler is really going to be in the dog house with the Govenor. First on Monday testifying before the Senate Budget committee, he disagreed with the Governor and said voters should support their school budgets. This was a direct contradiction to the Governor's statement the day before. Now yesterday, testifying before the Assembly budget committee, Schundler acknowledged that after school districts adsorb the cuts from the administration, taxpayers will see an increase in their property taxes:
"Local property taxpayers are being asked by school districts to help also, and by the time this year's school budgets are finalized, we will likely see school property taxes throughout New Jersey up by about 3 to 4 percent. That's a much smaller year-to-year increase than has been typical in the past 10 years."
But, But, I thought they wouldn't sign a budget that raised taxes? Oh that's right, they're making other people take responsibility for it. And that's just what he's acknowledging as the average increase. Some areas may see even larger property tax increases as aid losses are exempt from the 4% cap. We'll see how it all shakes out next Tuesday when voters head to the polls. Take our poll below and let us know if you will be supporting your school budget.
Rutgers-Eagleton has started releasing its latest New Jersey poll results and the first release focuses on Chris Christie and the budget. The poll is based on responses from 953 adults, but most results are for the 809 who claim to have "heard at least something about Gov. Chris Christie's proposed budget."
First, the poll finds Christie has dropped 12 points to just 33% favorable with 37% unfavorable. Recall that the last FDU poll had him drop nine points to 43-32. Keep in mind though that "all adults" is surely a worse sample for him than "2009 actual voters" or "2010 likely votes." Check the full PDF release for subsamples, where you'll find the identified groups that like Christie are "Conservatives" (61-18) and "Income 150K+" (50-31).
Meanwhile "Democrats in Trenton" and "Republicans in Trenton" languish at 26-35 and 25-37 respectively, so I'd guess this poll won't dissuade Christie from confronting the legislature.
The budget is at 13% "very pleased", 30% "somewhat pleased," 21% "Somewhat displeased," and 29% "very displeased." The vast majority of people think the budget cuts will affect them.
The fun part is asking two different questions to half the poll sample each. Professor Redlawsk did a great job here:
[VERSION A] The Governor also proposed a constitutional amendment limiting property tax increases to two and a half percent per year. Would you support such a constitutional amendment?
[VERSION B] The Governor also proposed a constitutional amendment limiting property tax increases to two and a half percent per year. Massachusetts passed a similar law in the 1980's which some say resulted in closing fire stations, libraries, and senior centers, and cuts in school programs. Would you support such a constitutional amendment even if it had those effects?
This is why campaigns--and negative campaigns in particular-- matter. Lower taxes with no consequences [A] is supported 64-27, with every race, party, gender and income supporting it. Lower taxes with negative local consequences [B] gets just 34-57, eking out a win only with self-identified Republicans, conservatives, and the $150K+ crowd.
On Tuesday, Governor Christie will propose a constitutional amendment that would limit property tax increases to 2.5% per year. http://www.nj.com/news/index.ssf/2010/03/christie_will_propose_constitu.html While on paper this seems like a good idea, it immediately reminded me of another good idea at the time that is backfiring today—California’s Proposition 13. http://en.wikipedia.org/wiki/California_Proposition_13_(1978)
California, a state notorious for ballot initiatives, passed Proposition 13 in 1978 in order to help people stay in their long-term homes that they could no longer afford due to rising property taxes. Proposition 13 limits taxes to 1% of a property’s assessed value, which under the proposition is only allowed to increase a maximum of 2% per year. Under this proposition, long time homeowners pay a lower property tax bill than their new neighbors. On paper it is a good idea, but the long-term effects are devastating. Proposition 13 also treats businesses and commercial properties the same as homeowners.
Of course with Christie’s proposal, the devil is in the details. Unlike Proposition 13, Christie’s proposal does not address the fluctuation in real estate prices (that I know about). What would a housing bubble and burst such as the recent one do to Christie’s proposal? This leaves me with more questions than answers. Services such as public schools, police, fire, public libraries, and infrastructure have been cut because of decreasing revenue. Especially after the recent storms that New Jersey had this winter, do we really want to gut first responders and infrastructure repair?
Of course now issues like Proposition 13 are not new. California’s financial problems make New Jersey look like a fiscal genius. The budget problems that California faces today can be linked back to Proposition 13. http://www.time.com/time/nation/article/0,8599,1904938,00.html The proposition also dramatically impacted the state’s per pupil educational spending, which is currently 48th in the nation and California’s public schools have suffered. http://www.time.com/time/nation/article/0,8599,1907504,00.html?iid=sphere-inline-sidebar
Now that there is a case study for how Proposition 13 affects the government over the long term, it makes no sense that yet another state would adapt this model. This proposed constitutional amendment is not fiscally responsibl. When the budget is debated between Christie and the Democrats in the legislature, I hope that the Democrats bring up the long-term effects of Proposition 13 on California. This is not a time for the Democrats to act like spineless wimps and they should fight this every step of the way. I’m a recent transplant to New Jersey and I see it as a perfect fit for me. However if Chris Christie has his way, I may have to reconsider in the long-term, as will many New Jerseyans.
It's going to be difficult to keep track of all the promises that Governor Christie breaks, which Candidate Christie made if things keep going as they've started. Lets see what candidate Christie said:
The last thing Chris will do is to follow Corzine's lead in eliminating property tax rebates for 1.2 million New Jerseyans. The rebate currently is the only property tax relief we have, and it provides much needed, meaningful help while we put in place other reforms. We keep the rebate in place to give taxpayers some breathing room in these tough economic times.
Not only wasn't he going to cut, he was going to restore the cuts he said Corzine had made to the program, even though people said he numbers didn't add up. During the primary, Christie attacked Steve Lonegan with a radio ad saying he would get rid of property tax rebates to differentiate his position. But now Governor Christie has a new plan and it could be his latest broken promise if he follows through:
Gov. Christie is considering scaling back or eliminating property-tax rebates in his budget proposal, a move that could yield significant savings but would mean going back on a campaign pledge.
Democrats wasted no time pointing out Christie's latest flip flop and Joe Cryan remined people that it was Christie himself who called reducing property tax rebates 'a declaration of war on the middle class' and pointed to what Republican leaders said just last year
"After all, I couldn't agree more with a key Republican leader who just last year said cutting rebates 'is actually a tax increase' that 'will take money out of people's pockets and continue to drive middle class taxpayers and senior citizens to bankruptcy.'
"That same leader also added, 'It is of great concern when people cannot rely on the governor to keep his word.'
Adam has documented some of the other examples where the middle class will take it on the chin from decisions the Governor is making. Christie is trying to say he has no choice, but while he was handed the problem he is choosing the solutions he wants to go with. Christie's fantasy land promises are coming back to bite New Jerseyans in the ass. And in many cases, its those residents that can least afford that are feeling the burden. He'll continue to say he's not raising taxes, but it's really a word game because at the end of the day, we're all paying more and getting less. It's simply a transfer of who is footing the bill.
I got my new assessment and rate in the mail recently, so I feel the pain in my wallet of the record numbers that are appealing their property tax assessments:
This year, an unprecedented number of New Jerseyans are challenging their assessments in the state with the nation's highest property taxes.
The number of appeals before Essex County's tax board have reached 6,487 this year - nearly twice the 3,631 appeals filed last year. In Ocean County, appeals have nearly tripled to more than 14,000.
"It's 14,129. I know that number by heart. I've been in the industry 35 years. It's a record," said L. Ozzie Vituscka, the county's tax administrator. "They're scared and rightly so."
Many local boards are getting extensions on their deadlines because they are so overwhelmed by the case load for appeals. Just how many people are appealing around the state:
So far, 15,918 New Jerseyans have reached the county boards or the state tax court - nearing the record of 16,300 set in 1992, said Lynne Allsop, court executive with the state's Tax Court Management Office in Trenton.
With thousands more appeals yet to be heard in the counties and a couple months to go to tally the incoming cases from extensions, that record is certain to fall, she said.
Declining home values and the difficult economy, coupled with many areas that haven't done a re-evaluation in years make the climate right for homeowners to appeal. Tax appeals can provide slight relief, but that doesn't address the underlying property tax problem.
Anyone who still thinks it's going to be easy as a talking point to fix New Jersey's problems should take a look at a few recent examples to see the roadblocks along the way. First let's look at the proposed merger between Sussex Borough and Wantage, which was voted down last week 3-1:
The consolidation seemed to make sense: The towns already share three regional schools, a construction department and a court system and, served by the State Police, wouldn't have to quibble over police. Plus, the towns had assets (land and utilities) to share. In an unsettling economy, when cutting property taxes is the driving political issue, this one seemed like a rural no-brainer.
They're actually much further along in the process of working together and sharing services than many other towns, but they still said no, despite the projected savings:
According to the Consolidation Study Commission report, the towns - if they merged - could have saved $585,000 in the first year. Future savings could have been greater with even more cost-cutting. That's a nice chunk of change, but it wasn't enough to persuade residents to erase a border - especially those in Sussex Borough, population 2,000.
It will remain to be seen if a Christie administration will force these consolidations, but something is going to have to give because this happens all over the state. Some of the smaller towns feel like they will lose their identity and be swallowed up by the larger town, while the savings are not really worth it. So they're will to pay a little more to keep their Home Rule. Lets look at the recent consideration given to merging just police services in Medford and Medford Lakes:
The budget for the Medford Lakes Police Department is approximately $1.1 million dollars. A consolidation study indicated that Medford Township police officers could provide services for roughly $600,000.
Ten years from now, Medford Lakes predicts its police budget would be approximately $2 million dollars. The study indicated that Medford Township police could provide services for roughly $700,000.
The savings to residents would equate to roughly $1.3 million dollars.
But despite the proposed savings, Medford Lakes council decided the residents wanted to "keep our cops" and voted down the proposal. They didn't even put it to the voters before putting an end to the year long plan and proposed savings. As the Courier Post put it:
We complain of high property taxes...yet balk at any real opportunity to shrink the government's size and cost.
If we're not going to consolidate and merge towns, at least a step in the right direction would be to start with bulk purchasing for better rates. It's not just towns, we have commissions and authorities with bonding power, local school boards, regional school boards, county government, state government and more.
Of course erasing borders and overcoming the feeling that smaller towns are losing their autonomy as they perceive it will be more difficult, but if we don't start taking steps in the right direction we're not going to be walking at all. And we can't afford to stand still anymore.
The Corzine campaign is out with a new web ad this evening hitting Chris Christie over comments he made to the New York Times saying that he's breaking his campaign promises before he even gets elected to office. First, from the NY Times article:
Regarding property tax rebates, Mr. Christie now says he cannot fully restore them - though his commercials omit this qualifier - and that he will send back the money only "on a sliding scale depending on what the economic conditions were." He explained the turnabout by saying he was "prioritizing out of a set of bad choices."
Referring to looming deficits, he added, "It's not like I can click my heels and say, 'Make the bad stuff go away.' "
The change is one of several recent reversals. Mr. Christie now also disavows a promise, made in a primary-season debate, to roll back a sales tax increase. He has backed away from a pledge to avoid using "one-shot" revenues to close the budget deficit. And he is now deferring until later in his term plans to eliminate a business tax surcharge, cut income taxes across the board, identify a permanent financing source for open-space preservation and restore higher-education financing to 2002 levels.
His biggest surviving pledge is to roll back Mr. Corzine's tax increase on people making more than $400,000 a year.
One of the main reasons environmental groups went with Christie was because he supported a permanent financing source for Open Space. So now he not only opposes the bond question, but won't come up with a permanent solution as promised. And what happens if a Christie economy doesn't get better? Do those choices get deffered to the next Governor? Here's the ad:The Democrats have been all over Christie's comments to the NY Times today. Assemblyman Greenwald had this to say:
"It's amazing that Chris Christie has waited until only four days before the polls open to admit that his entire economic plan was built on a foundation of sand," said Greenwald (D-Camden). "The more Christie tosses his grandiose promises of the spring under the wheels of his campaign bus, the more it becomes obvious that his proposals were meant only to make good sound bites, not sound fiscal policy. New Jersey couldn't afford Christienomics in the 1990's, and we can't afford it now."
And Assemblywoman Quigley didn't miss the chance to hit Christie for his latest broken promises:
"It only took 268 days since he threw his hat into the ring, but with four to go until the election Chris Christie has finally come to terms with the devastating fact that his fiscal platform is a non-starter," said Quigley, a member of the Assembly Budget Committee. "But now he faces an even more painful reality: telling prospective voters that his entire plan was a mirage."
He may have only formally declared 268 days ago, but he's been running for much longer than that. It's amazing that of the few specifics he does give, they always seem to get him in trouble. He lost his shared values in the course of a "website re-design", he tried to delete the words mandate-free from his website altogether and since he can't hide the fact that his fiscal don't hold up when exposed to the real world, he's backing away before he can even implement them.
1. Make noise. Let your elected officials know you are out there, that you're angry and that you want them to lower your tax bills.
Look of course no one is happy about taxes, but lets see them encourage people to try and understand the problem we actually have rather than just inciting more anger. They continue with their steps in the plan:
3. On Tuesday's editorial page, we will publish a survey we will provide each of the candidates for state office in November. It will ask them to state their three most important ideas for reducing taxes and government spending, and which of the 20 points in the Asbury Park Press/Gannett New Jersey tax relief plan they would push for if elected. The candidates' responses to the surveys will be posted at APP.com. If you don't see their response, badger them until they have completed the survey.
Yes, badger your representatives and candidates until they complete the Asbury Park Press survey of their very own tax plan. Why do a newspaper even have a tax plan, they're supposed to report on the plans of others. They continue:
5. If you, your friends or neighbors have been involved in any anti-tax initiatives at the federal level, draw on those experiences to help organize networks or build on existing ones to keep the pressure on Trenton.
Go find national anti-tax people so they can add to the complaints, because that will help solve the problem. How about keeping the pressure on the newspapers to report the news, not make it themselves? And let's not forget the step in the action plan where you find other people who read the Gannett newspapers:
6. Network with people who have expressed views similar to your own in the "Tax Crush" series Story Chats and the Sound Off portion of our online "Tax Crush" section. Join forces, work together.
Search the online comments section for other outraged people to make yourself more angry. That's responsible. It's quite clear they're pushing a partisan agenda, which while not surprising is still disappointing, because now more than ever we need real reporting to inform the readers of the complex issues facing our state.
This opinion which appeared in today's Bergen Record addresses distortions based on the Tax Foundation's analysis focused solely on property taxes. What I found most interesting is the total tax burden in NJ is lower than many states, it is just disguised by the tax structure.
Taxes will go up for those making over $400,000 per year.
Pre-school expansion will be delayed.
Only a fraction of the pension contribution will be made.
There probably won't be aid to the unemployment fund.
These moves are said to be temporary. Republicans are already denouncing the lack of property tax rebate checks in press releases, saying other things should be tried first. I'd say with furloughs, pay freezes, etc. just about everything is now being tried.
Assembly Budget Chairman Lou Greenwald put out the following statement:
Thus far, the parallels between the gubernatorial campaigns of 1993 and 2009 appear striking. On the one hand, the Democratic Governor has toured New Jersey in an effort to present bold, politically risky solutions to the enormous challenges confronting state finances. On the other, Republicans have exploited popular resentment of our state's high cost of living and opposed efforts to achieve fiscal solvency. Yet those who think the coming campaign will mirror the anti-tax revolt of 1993 should consider the consequences of that election and its significant impact on our state's current fiscal health.
On Thursday, New Jersey lawmakers, lobbyists, and business leaders made the annual Chamber of Commerce sponsored train trek to the nation's capital. State Senator Jennifer Beck (R-Monmouth), rumored to be on Chris Christie's shortlist of candidates for Lieutenant Governor, criticized Governor Jon Corzine's handling of fiscal issues. Pointing out the failure of his asset monetization plan, she asked, "What's his legacy?"
Former Bogota Mayor Steve Lonegan, himself in hot pursuit of the Republican gubernatorial nomination, believes the state's problems can be solved by implementing tax and spending cuts with the zeal of a "kid in a candy shop."
Senator Beck, Mr. Lonegan, and their fellow Republicans fail to recall their own party's legacy of fiscal irresponsibility. In the aftermath of Christine Todd Whitman's 1993 victory over Jim Florio, Republicans enacted the very policies that led to our present predicament. According to a 2001 report published by New Jersey Policy Perspective, Whitman Administration budgets were:
... dangerous to the state's economic health. New Jersey cut its income tax more deeply than other states and reduced more than 40 other taxes. This tax cutting went along with increased, not reduced spending. So, despite unprecedented prosperity, New Jersey never got its budget in true balance, usually spending $400 million more than its current revenues.
The use of one shot revenue sources, increased borrowing, and the numerous withdrawals from so-called savings accounts ultimately resulted in a reduction of aid to municipalities and an increase in property taxes. The last time Republicans controlled the State Capitol they robbed Peter to pay Paul, growing the size of government while taking credit for significant cuts in income taxes; cuts that only transferred the burden to towns strapped for cash in the face of shrinking assistance from Trenton.
Governor Corzine announced in his 2008 State of the State Address that New Jersey needed to restructure "our fiscal practices, balance sheet, and most vitally, our culture" or "our options, our priorities, and our future will be continually constrained." One year later, he faces criticism over his inability to win passage of proposals such as the monetization plan and pension payment deferrals. However, upon considering the Governor's quiet success at reigning in runaway budgets through spending cuts and state workforce reductions, a different picture emerges.
New Jersey's budget for Fiscal Year 2009 spends $600 million less than it did last year. That is the largest year to year decrease in state history, and three times larger than any reduction in the past. Moreover, it dedicates $650 million toward debt reduction, resulting in a savings of $675 million over the next five years. Perhaps most importantly, this budget moves us closer (from $1.8 billion to $600 million) to eliminating the use of one-time revenue sources, a gimmick employed in the past by Democratic and Republican Governors alike.
According to a recent article in the Philadelphia Inquirer, Mr. Lonegan would veto programs that he believes are wasteful or "out of step with his conservative view." Like most of the naysayers in his party, specifics are not the former Mayor's strong point. However, the question begs to be asked, where would Republicans cut? Would they reduce the $16.7 billion - fifty percent of the overall budget - allocated for property tax relief? Or would they prefer to cut the $11.5 billion allocated for aid to public schools?
Through consolidation of departments, this year's budget already reduced the cost of state government by $300 million. The size of the state workforce has been reduced by 2,000. Legislative pork in the form of Christmas Tree expenditures have been eliminated. There are no new taxes, and none of the existing ones have been raised.
The failure of Governor Corzine's asset monetization program does not erase the significant progress he has made in restoring sanity to fiscal policy. Christie Whitman won in 1993 because she painted Jim Florio as a tax and spend liberal instead of recognizing him as the pragmatic problem solver that he was. As the present campaign unfolds, Republicans will look to the same tired playbook. It is important for Democrats to push back against these criticisms, point out the Governor's record of responsibility, and remind voters what happened the last time Republicans were in charge of New Jersey's purse strings. In some ways, 2009 may resemble 1993, but it diverges in one crucial respect: we know how the story ends.
Promoted by Jason Springer: A thought provoking, well written post on the politics of Affordable Housing.
Democrats must be prepared to transform the statewide mandate of the Council on Affordable Housing (COAH) or else ready for Republican criticism that may diminish our support among suburban voters.
On Friday, former Bogota Mayor Steve Lonegan traveled to Freehold to stump for votes in his campaign for the Republican nomination for Governor. Lobbing rhetorical grenades is the conservative gadfly´s specialty. He likened his campaign to the American Revolution and compared Governor Corzine and the Democratic majorities in the Legislature to the tyrants of Europe and Asia. The twenty-first century Washington continued with a blistering attack on COAH and promised that when the general election is through, the self-financed Corzine will be living in one of the program´s 40,000 units.
Next November´s election will not only determine who occupies the front office in the State Capitol. It will test New Jersey Republicans´ability to make inroads into the Democrats´legislative majority. As New Jerseyans sweat under the burden of economic recession, unless Democrats present a compelling narrative for affordable housing, COAH and its cumbersome regulations have the potential to unite the feuding factions of the GOP and erase our party´s gains in suburban battlegrounds.
From a policy perspective, the need for affordable housing remains as clear today as it was when the Supreme Court ordered state action on the issue in 1984. According to the U.S. Census, New Jerseyans pay 30 percent or more of their income for housing, the fourth highest percentage in the nation. However, members of both parties recognize that in its current form COAH often results in continued overdevelopment and an increase in property taxes as municipalities struggle to fund essential services and public schools.
Democrats in the Legislature have already indicated their willingness to take on the challenge. In his capacity as Chair of the Economic Growth Committee, State Senator Ray Lesniak (D-Union) introduced legislation (S2485) that directs the State Housing Commission to take into consideration the impact of its assessments on local property taxes. Lesniak also wants COAH to provide housing not only to low income individuals, but to those in the middle class who do not qualify for the program but nonetheless struggle with New Jersey´s high cost of living. Called work force housing, the change will allow individuals such as secretaries, firefighters, and recent college graduates to qualify for assistance while remaining in and contributing to the economies of their hometowns.
In his recent State of the State address, Governor Corzine indicated his willingness to "allow for maximum flexibility and ample time for collaborative review" of affordable housing plans. In the coming months, the Governor and Democrats will face the challenge of articulating the need for COAH regulations to a public that is leery of continued development.
Affordable housing may be an issue that Republicans can use to their advantage, but thus far they have offered no policy alternative other than S2292, a bill re-establishing the regional contribution agreements that circumvented the intent of affordable housing in the first place. Their advocacy of a return to the failed status quo does nothing to address the real problem. On the other hand, Lesniak´s call for work force housing demonstrates the Democratic Party´s understanding that suburban housing is not only out of reach for the working poor, but for many sons and daughters of middle class suburbanites.
New Jersey is a blue state and New Jersey Republicans are a party rife with ideological divisions. Criticism of COAH presents them with an issue that they can rally around. However, they will need more than bombastic rhetoric and stale policy solutions to convince voters of their ability to solve the problem. Democrats have demonstrated our willingness to ease the burden on municipalities without abandoning our commitment to providing affordable housing to those who are struggling under our state´s high cost of living. The remaining challenge for lawmakers is to deliver on the promise of reform and communicate the results of that work to the residents of our state.
Seven counties in New Jersey ranked in the nation's top 10 highest property tax bills from 2005 to 2007, according to a recently released study by the Tax Foundation, a nonprofit group monitoring fiscal policy.
Hunterdon ranked highest on the list at third place with a median property tax of $7,708, according to the report. Bergen, Somerset, Essex, Morris, Union and Passaic counties also made the top 10.
Now to be fair, many of these locations have some of the highest property values and income levels are higher than many areas in the country. This is also a study from a conservative think tank, so make of it what you will. The report gives you the numbers and factors that contribute to them, but doesn't give a workable solution to fixing the problems that exist. Despite the lack of context, there's no doubt we'll see the claims in future campaign literature.
