Property Tax Reform Bills Sent to Governor Update

The Senate on January 29 gave final legislative approval to property tax reform bills that would create a State comptroller position to monitor spending, reform pension laws, and encourage towns to consolidate and share services. The measures now go to Governor Jon Corzine. Meanwhile, the Senate is scheduled to vote February 5 on A-1 (Roberts, McKeon)/S-20 (Codey, Kenny), which would cap annual property tax increases at 4 percent a year and provide tax credits of 10 to 20 percent to homeowners with annual household incomes under $250,000. The bill passed the Assembly on January 29.

With final passage of these measures, the property tax reform effort that began over the summer is nearing an end. From the beginning, NJBIA urged legislators to focus on reducing local government spending because that is the driving force behind New Jersey’s highest-in-the-nation property taxes. NJBIA supports these bills because they would improve the current system, although the Association had pushed for stronger cost controls.

Also, NJBIA is pleased the Legislature did not attempt to shift more of the tax burden onto business by further raising business taxes or removing the uniformity clause to the New Jersey State Constitution, which requires that business and residential property be taxed at the same rate. Here is a look at the measures that have been sent to the Governor.

A-2 (Watson Coleman, Burzichelli)/S-15 (Kenny) would establish the Office of the State Comptroller to audit State spending and contracts. The comptroller also would review local independent audits, but conduct a local audit only if an independent audit uncovers material deficiencies.

A-15 (Wisniewski, Gordon)/S-12 (Smith, Sweeney) would create the Local Unit Alignment, Reorganization, and Consolidation Commission to recommend consolidation and shared services among the State’s 566 municipalities and 186 fire districts. Those recommendations would then be put to a referendum in the affected municipalities. If a majority of voters approve the referendum in each municipality, those municipalities would be regionalized as the commission recommended.

A-20 (Panter, Pou)/S-14 (Adler, Karcher) would mandate that public officials and employees convicted of bribery or corruption automatically forfeit their pensions.

New Jersey Business & Industry Association ( www.njbia.com ).  - 2/05/2007