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.
The Governor put out a video talking about how he is trying to avoid many of the double digit tax increases with his plan that will allow municipalities and counties to defer half their pension payments. He says these extraordinary times call for extraordinary measures. See for yourself:I understand the Governor is trying to soften the blow, but the questions will come up regarding the mix between politics and practicality with this situation. People are certainly struggling, but it's also harder to run for re-election defending enormous tax increases. Eventually we are going to have to pay for this and it may be a larger amount with the interest that will be factored in. What happens if towns are still struggling in 2012, do we defer again? At some point we are going to have to start working on the cause of the illness, not just the symptoms.
My opinion? If you're running for office in NJ, you oughta be paying full freight on your make-believe farm. If you're getting too old to make $10k a year on your land and you are a real farmer, then put it into the landbank and keep your farmland assessment. But this idiot game of selling two trees to your bro-in-law for $500 and smiling all the way to the bank as you pay 1/10th of what everyone else in your neighborhood does, just because you can afford five acres and an accountant - that's just an entitlement issue you need to overcome. You're not entitled to a tax break because you have a nice big property. See the following in today's CP:
In New York State, the following eligibility requirements must be met.
* Land generally must consist of seven or more acres that were used for the preceding two years for the production for sale of crops, livestock, or livestock products.
* The annual gross sales of agricultural products generally must average $10,000 or more for the preceding two years. If an agricultural enterprise is less than seven acres, it may qualify if average annual gross sales equal $50,000 or more.
Not so much a play farm anymore, is it? I'm totally in favor of farmland preservation - it's rich guy playground preservation I've got a problem with. And I didn't like it any better when Ellen Karcher did than when Christine Todd Whitman did - and Whitman actually had a pretty good case for being a "real" farmer, considering the ridiculously low bar set in NJ.
Time to raise the bar. Let the rich guys land bank it if they don't want to pay the full tax. I don't know all the ins-and-outs of the landbank process and whether this would constitute an egregious example of eminent domain run amok - I just know I don't approve of 5 acre "play farmettes" paying dramatically lower tax rates than 1/4 acre properties on contiguous lots.
Earlier this month, Senator Barbara Buono (D-Middlesex), Chair of the State Senate Budget and Appropriations Committee, scored points for fiscal responsibility and common sense by advocating the elimination of pension credit for part-time government employees. This past week, she scored a touchdown when she pledged to reject any attempts to insert "Christmas Tree items" into the budget for the new fiscal year beginning July 1. She also proposed the restoration of $62 million in proposed cuts in municipal aid, including $37 million in eliminated tax relief for towns with fewer than 10,000 residents.
This Tuesday we have an opportunity to vote on the largest budget in the state: schools. Schools take in a significant majority of the state's funding sources, including property taxes, sales taxes, income taxes, fees, lottery revenue, etc. and we get a chance to vote on them.
But no one shows up.
We also get a chance to vote on the people who set these budgets, picking new members of our school board. Except that we often don't, with the same people running year after year and no one challenging them. We scream and yell and spend tens of thousands of dollars on council races that have manage budgets less than half the size of school budgets, but these school board races get no one filing to run and ... no one shows up.
We talk about how we need to move the school elections to primary day to make them more noticed, but is that really a solution? If folks can't get off their butts to vote for who educates our children, for how much we spend on that education, for how that education is provided, and for probably 50 percent or more of all state taxes they pay then what's the point?
I don't really mean this, but if they're not interested now with all that at stake simply because the election is in April, then do we want them voting at all?
I'm just frustrated that no one cares, that the polls are so quiet for these vitally important elections.
Are you gonna vote? Do you know who is running? How big the budget is? What programs are being cut, what programs are being added?
Salem County's big political news for the last month has been Governor Corzine's proposed budget, which hits our county in two special ways: The elimination of the Department of Agriculture and the municipal aid cuts to towns below 10,000 people. Since I believe the state is in a terrible mess, and am an opponent of the toll road privatization scheme, I'm not going to rant and rave; I wouldn't want to argue that aid to my little town that helps my property taxes is more important than countless state government functions, and I sure wouldn't want to be governor. But since I write these round-ups for Salem County, I will describe why these particular policies are tough on the county.
I do think eliminating the Department of Agriculture would be a huge mistake. As Freeholder David Lindenmuth observed yesterday, "by some estimates, closing the Department of Agriculture would save as little as $341,000, since the essential functions of the Department would still need to continue." This figure alone should bring us pause. Setting aside the economic value of farming and the well-known benefits of food to humans, in a state where the population has supported otherwise unpopular taxes and borrowing to support Farmland and Open Space Preservation, it seems extremely misguided to undermine these efforts by eliminating the strongest support for working farmers. The old expression was "Penny-wise and Pound-foolish." It's easy to find online that preservation efforts are measured in hundreds of millions of dollars. The saying "Million-Dollar-Wise and Hundred-Million-Dollar Foolish" isn't as catchy, but it's a similar ratio.
Governor Corzine floated a plan recently to raise tolls on the highways in order to pay down the state's out of control debt. The idea is that with lower debt payments more of the money raised by other means -- sales and income taxes, fees, fines, casinos, etc. -- could be used to prop up local government.
Today we learn that this plan, which would likely deliver property tax reduction even if it did raise tolls a similar amount, is unacceptable to the public. According to a Gannet sponsored poll conducted by Monmouth University, 56 percent of the public actively opposes the plan and 70 percent of the public at least leans against it.
The public hates the way things are, but opposes any change except cutting taxes without any offsetting service changes, which is ridiculous.
They want to keep the same services, only get them better. They want to keep the same roads, only repair them and get rid of the tolls. They want the same local governments and services, only make property taxes lower. They want income and sales tax levels reduced, but they want to increase aid to schools and towns.
Give me my home rule, my local township committee, my school board, my fire district, my county government, all my state services ... and give me lower taxes.
Election Day was full of disappointments, but the main disappointment was expressed by the voters in the leadership of our state in general and the Democratic party in particular. The voters told our leaders that their chances are up, and they want property tax results now or they will exact revenge.
The country has not been more pro-Democrat than it is right now. Only 19 percent of New Jersey residents gave the Republican President a positive rating two weeks before the election, and the national ratings have more than 50 percent strongly disapproving. General approval of Democrats to run Congress is more than 20 percent higher than that for Republicans.
This should be a time that a blue state like New Jersey begins to crush the Republicans and put them into the minority for decades. But that requires real leadership and management, something we are obviously not getting from our current leaders. And the voters feel this failure deep in their bones.
A Rutgers-Eagleton poll finds that by a 56%-37% margin, likely voters would support a $450 million bond referendum question to fund stem cell research. Catholics support the measure by 48%-41% and evangelicals and born-again Christians do so by a similar 48%-42% margin. The breakdown is 62%-22% for Democrats, 57%-32% for independents, and Republicans are split 45%-46%.
But even among those who disagree, only a small minority do so on moral grounds. Of those opposing the referendum, 58% say the state can't afford to borrow the money while 26% say it's for moral reasons. Tim Vercellotti, director of polling at the Eagleton Institute of Politics, says "the margin favoring approval of the stem cell research bond issue is typical for recent ballot questions about state uses of public funds, despite public controversy surrounding this type of research. That some of the key constituencies expected to oppose the ballot question, such as evangelical Christians and Republican voters, are narrowly in favor or divided speaks to the strength of public support for the bond issue."
By a much larger 70%-21% margin, voters support the ballot question which would dedicate the entire penny increase in the sales tax towards property tax relief.
The poll shows a steep drop in Governor Corzine's approval rating from 57% in August to 47% today. Two thirds of voters now think there is a lot of public corruption in the state, up from 47% in August, 2004.
And while approval of the Democratic-led legislature has dropped from 37% in 2004 to 30% today, Democrats may not suffer much at the polls. By 10 points, likely voters prefer Democrats to Republicans for the Assembly (42%-32%) and Senate (44%-34%). In both cases, the split is similar to the results from 2003 (41%-32% for Assembly, 43%-33% for Senate).
Among likely voters, 28% said reducing property taxes was the top issue the next governor should address. Overtaking corruption as the #2 issue in 2005, 21% said reducing the budget crisis should be the top priority, while corruption registered a close third at 19%.
A recent study by Rutgers University shows residents of the Garden State are leaving in large numbers. More than 72,000 residents left New Jersey than arrived here just last year alone. As a result, tax revenue was reduced by nearly $700 million while New Jersey's economy lost approximately $10 billion in personal income because of the exodus. The emigration is likely to continue and will only swell budget deficits in the years ahead. While Governor Corzine has stated that the exodus is the result of retirements and that is true to at least some extent, there is much more at play:
Yes boys and girls. The NJ Assembly GOP posted his letter on their little tax website without his permission and without attribution.
Joe Cryan didn't miss the softball he had been lobbed...
"This is property tax plagiarism by the Republicans," said Assemblyman Joseph Cryan, D-Union, the state Democratic Party chairman. "It's one more chapter in the real horror story of the GOP's failure and dishonesty on property taxes."
Seriously, is there anything the NJ GOP can't screw up?
The general reason for giving a tax abatement is to entice developers to build where they ordinarily wouldn't want to build. For example, any of the dozens of sites in Hudson County contaminated with chromium. The basic idea is that you allow the developer to recoup some of the extra cost of building in less desireable areas.
That idea has been sold so far down the Hudson that it's probably off the coast of Bermuda by now.
Downtown Jersey City is the only place in the world that gives you a riverview across the Hudson of Lower Manhattan (technically, Hoboken and Bayonne can claim a bit of a view, too, but Jersey City has the primo view - especially once the Freedom Towers go up). Comparing property values and taxes from Manhattan make Jersey City a freaking bargain as it is. The waterfront has been booming for years.
There is a $2.5 billion budget deficit projected for 2008, yet this year's proposed $33.5 billion budget represents about a $2.7 billion increase over last year. What is going on here?
The short answer is it's an election year gimmick. The longer answer is that a huge chunk of the increase comes from boosting property tax relief to up to 20% so that voters are placated by a check/credit that we already know we can't provide them with next year.
While it's critically important to address rising property taxes, introducing structural deficits in the state budget is not the way to do it. Governor Corzine vowed to end the practice of one-shot gimmicks to balance the budget. It's disappointing that he's letting the legislature get away with it to score cheap political points. The legislature didn't even begin to address the root problem with property taxes, and the fact that they are producing an unsustainable budget is proof.
Corzine should admit - for the sake of the state's fiscal integrity - that the political will is not there to fix the property tax problem and that it's time for him to call for a citizens' constitutional convention. It may or may not succeed at solving the problem, but we know that under the best conditions, the legislature couldn't do it.
S everal months ago, the Jersey City Council, worried about a looming property tax hike, extracted a pledge from Jersey City fire officials that naming 17 new captains would be the last promotions to be made for a while.
So, how do these officials explain and justify the cost of the scheduled promotions of four battalion chiefs to deputy chiefs, along with four captains to the rank of battalion chief slated to happen today?
After tomorrow, the JCFD and its 600-person department will have 11 deputy chiefs, whose base pay is $129,000 but could be more depending on their seniority. Comparatively, the city's Police Department has a 900-person force with only four deputy chiefs.
Believe me, I like it when the fire department is fully staffed and able to do its job. The problem is that this doesn't do that at all. I'd rather see the extra money given as an across-the-board pay raise than to bulk up an already bloated city department.
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