NJ Assembly panel advances bill to reduce property taxes, designate state songs
Legislation to reduce New Jersey's notoriously high property taxes was voted out of the Assembly State and Local Government Committee on Monday during the panel's first meeting with Assemblyman Troy Singleton as chairman.
Singleton, D-7th of Palmyra, took over leadership of the committee at the start of the new two-year session, and he used his first meeting to post bills aimed at lightening the state's heavy property tax burden by returning millions of dollars in funds collected from energy companies and utilities, called energy tax receipts, to municipalities, as well as another measure intended to help towns and other local governments save money by using electronic procurement for some biddings, purchases and property sales.
Singleton also posted a bill seeking to designate five official state songs of New Jersey.
Most of the discussion was devoted to the energy tax receipts measure, which would phase in the return of $331 million in funds diverted from municipalities to the state's general fund during the 2009, 2010 and 2011 fiscal years.
Close to $1 billion is collected by the state annually from utility and energy companies in lieu of property taxes for the use of public lands for infrastructure such as power lines, pipes, plants and substations, as well as for government services that utilities receive, notably police and fire protection.
Mayors say the money is supposed to be returned to their communities as part of their annual state aid. However, they claim large sums of the revenue have been diverted to the state's general fund at the expense of their towns, which have endured reduced or flat aid for several years.
The aid is used to pay for services and keep property taxes in check.
The legislation to phase in the $331 million in diverted funds was penned by Singleton and colleagues Herb Conaway, D-7th of Delran, and Jay Webber, R-26th of Morris Plains. The return of the funds would occur over a five-year period beginning in fiscal year 2017, but the bill would mandate that all additional aid be applied directly as an offset to local property tax levies.
The language ensures that the aid is used as direct property tax relief rather than to fund local spending and services.
Jon Moran, senior legislative analyst with the New Jersey League of Municipalities, said the league supports the "vast majority" of the legislation but would like the levy reduction mandate removed or amended, arguing that local officials have demonstrated their dedication to controlling property taxes and deserve more flexibility in determining how to use the additional funds.
"We urge you to trust local officials to balance local needs and local resources," Moran said during the hearing, adding that the aid is one of the three main sources for funding services, along with property taxes and fees.
Webber said the state faces a property tax "crisis" that necessitates the tough language mandating the money be used as a direct property tax offset.
Last year, property tax bills rose on average 2.4 percent, despite the restrictions imposed by the state's 2 percent property tax cap, which exempts some costs for schools and municipalities. Those exemptions include debt service, declared disaster responses, and increases in health and pension costs.
It's unclear if Gov. Chris Christie will support the measure. He vetoed an earlier version of the legislation penned by Singleton in 2012. That did not have the tougher language mandating the funds be used to reduce tax levies.
Singleton said the legislation's goal is to return money to taxpayers' pockets as quickly as possible.
"Whatever we can do to put money back in the pockets of those who are actually funding the bill — I think we should all hold hands and realize this is probably the best we can do under the current (fiscal) environment we have," he said prior to the committee's 5-0 vote to release the measure.
In addition to the energy tax receipts bill, the committee unanimously approved legislation to allow local governments to do electronic bidding for the purchase of some goods and services. The New Jersey Press Association opposes the measure because it allows towns and schools to reduce their paid legal advertisements to a brief notice and link to a website.
The state song bill also advanced, designating five songs as the official state song, state anthem, state children's song, state ballad and state popular song.
The bill specifies that "I'm From New Jersey" by the late Red Mascara, of Phillipsburg, Warren County, would be designated as the state song.
Mascara penned the song in 1960 and spent over 50 years lobbying lawmakers to name it New Jersey's official song. He died in June with his dream still unfulfilled.
During Monday's hearing, lawmakers heard from Mascara's grandson, Christopher Lee, who thanked Singleton for posting the bill recognizing his grandfather's song.
"I wish he was here to see this, because I think this is the year it will be in writing and New Jersey will have a state song," Lee said.
Also testifying Monday was Delran High School senior Lucca Lewis, who spoke on behalf of a group of students that has lobbied to have "I'm From New Jersey" named the state song.
"We've supported Red's campaign for the last three of his 54 years to finally get New Jersey its first state song, and we will continue to fight for him and New Jersey," Lucca said. "Let's get it passed this time."
Conaway, a co-sponsor, said the bill was important both for New Jersey's culture and because of the residents who have lobbied for its passage.
"It stands as a testament for what can happen when people get behind a bill and stick with it," he said.