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Dear Mayor:
Legislative leaders have announced the membership and opening hearing dates for the four bi-partisan, bi-cameral special joint committees that will evaluate Governor Corzine’s ambitious Blue-Print for Property Tax Relief and Reform. (See our letter of July 28 for details.)
Judging by some of the statements we’ve seen, it appears that the Legislature will place great stress on municipal consolidation.
Senator Bob Smith, who will co-chair the Joint Committee on Government Consolidation and Shared Services along with Assemblyman John Wisniewski, said, "At the root of the property tax crisis is the duplication and inefficient delivery of services that characterizes the 'home rule' system of government that local officials cling to so zealously.”
Senator Ellen Karcher, who will also serve on the Committee, announced, "I know well the 'multiple municipal madness' that affects so many on the local level, and the strict adherence to the dogma of 'home rule' that drives the cost of property taxes through the roof. Without a push towards consolidating and sharing services, and meeting the obligations of local government more efficiently than we currently do, any attempt to reform the property tax system in New Jersey is doomed to fail.”
We agree that regionalization and service sharing present excellent opportunities for local savings. That is why so many municipalities have been involved for so long in so many such arrangements. We know of none who ‘zealously cling’ to inefficiency. Nor have we encountered the many on the local level affected by the ‘madness’ of a strict adherence to the ‘dogma,’ of which the Senator speaks. Still, it is easy for some, both in the Legislature and the Press, to make home rule the scapegoat for high property taxes, and to paint, as the villains, local officials struggling to provide effective services in a system that they did not create and that they cannot change.
Another good, hard look at how the State can remove impediments to, and encourage greater use of, such relationships can help. But all involved need to realize the limitations of such an approach. For instance, a 2003 report from Rutgers, the State University found that reducing the number of school districts in the State in half (a tall order to begin with) would result in a $365 million savings after 4 years. This would be a good savings, no doubt, but a drop in the bucket in the big picture.
Assemblyman Bob Gordon, who will also serve on the Committee, seems to have a good perspective on the matter. He has said, "Shared services must be a critical component of long-term property tax reform. We must be able to provide municipalities with greater opportunities to consolidate their resources and we must be able to show residents real results in the form of savings on their property tax bills.”
The other members of the Committee, which is scheduled to open its deliberations at 10:00 am, on Tuesday, August 8, are Senator Joe Kyrillos and Assemblyman Joe Malone.
Of particular importance in addressing a major part of the property tax crisis will be the Joint Committee on Public Employee Benefits Reform, which has scheduled its first hearing for Wednesday, August 9, at 10:00 AM.
In its recent series, “Runaway Pay,” the Bergen Record rightly called public employee compensation “the biggest reason for our fiscal woes.” The Record’s focus on teachers and public safety officers sheds light on the major problem facing local elected officials and the property taxpaying citizens that they have sworn to serve.
On the same day that appointments to this Committee were announced, local officials were informed by the Division of Pensions that 2007 property tax contributions to PERS and PFRS will total $650 million. That will mean $267 million in new spending, over which local officials will exercise no control, next calendar year.
This Committee appointed to grapple with this issue will be co-chaired by Senator Nicholas P. Scutari and Assemblywoman Nellie Pou and include Senators Ron Rice and Bill Gormley and Assemblymen Thomas Giblin and Kevin O’Toole.
The Joint Committee on Public School Funding Reform also faces a major challenge in promoting property tax relief and reform. The Committee will be co-chaired by Senator John Adler and Assemblyman Herb Conaway, and includes Senators Joe Doria and Gerald Cardinale and Assemblymen Brian Stack and David Wolfe. It is scheduled to meet on Thursday, August 10 at 10:00 AM.
In accepting the co-chairmanship of the Joint Committee on Constitutional Reform and the Citizens Property Tax Convention, Senator and Majority Leader Bernard Kenny said, "This is a distinguished committee of very capable legislators and I look forward to a bipartisan review of all the constitutional issues involved in meaningful tax reform. My hope at the outset is that we can effect meaningful property tax reform in the coming months without the necessity of a convention later. The immediate task for this panel is to consider what possible changes to our tax structure require constitutional amendments to be considered by voters."
Our hopes mirror those of Senator Kenny, but our expectation is that a Citizens Convention will be needed. And progress toward that probability will be essential.
Assemblyman John Burzichelli is the other co-chair of the Committee, which will meet this Friday at noon. The other members of the Committee are Senators Fred Madden and Leonard Lance, the Senate Republican Leader, and Assemblymen Lou Manzo and Richard Merkt.
The on line version of this letter includes links to member lists of the Committee referenced above. For more information, contact Jon Moran at 609-695-3481, ext. 21.
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