Friday, July 28, 2006

Corzine's Property Tax Proposals

From Bloomberg:

New Jersey's Corzine Offers Proposals to Lower Property Taxes

New Jersey Governor Jon Corzine proposed asset sales, debt reduction and changes to the public- employee pension system as part of a plan to raise money to reduce the state's property taxes, the highest in the nation.

Corzine also proposed the creation of an appointed state comptroller to audit the finances of New Jersey agencies, and a 4 percent cap on increases in property-tax bills. Property taxes now account for almost half the taxes collected in the state, compared to a national average of about 30 percent.
...
Corzine said he plans to have technology in place by July 2007 that would allow the state's treasury office to replace rebate checks with direct credits on property-tax bills. The governor proposed using $350 million of the dedicated sales-tax revenue for these credits. When combined with existing state funding for rebates, the tax credit program would be more than $1.6 billion, he said in his speech.
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One area of reform, Corzine said, will address pension and benefits for public employees. The state has an $18 billion deficit in state-run pension funds for teachers and other public employees, after lawmakers deferred contributions to eliminate budget shortfalls.

Corzine said his administration will be prepared as early as the middle of September to begin negotiations with state employee unions, whose contracts expire next July 1. Topics of negotiations will include raising the minimum retirement age and requiring public employees to pay part of their medical expenses, Corzine said.
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Another element of Corzine's reform plan calls for reducing the state's more than $30 billion debt burden, the governor said. New Jersey has $2.3 billion in debt service this year, money that could be put to better use elsewhere, Corzine said. That figure will expand by more than 25 percent in just four years, he said.
...
Corzine said he has directed his administration over the next three months to prepare a list of assets that could be leased or sold, to raise money for debt reduction. He didn't say what assets could be up for sale or lease, though he has said in recent months that he wouldn't rule out a leasing of the New Jersey Turnpike or other state toll roads.
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New Jersey's debt has more than tripled in the past decade, to $30 billion in fiscal 2006 from $8.1 billion in 1996. The state has a credit rating of AA, the third-highest investment grade, from Standard & Poor's, and Aa3, the fourth-highest rank, from Moody's Investors Service.

6 Comments:

Blogger grim said...

The speech can be viewed online here:

GOVERNOR CORZINEā€™S PROPERTY TAX RELIEF ADDRESS

grim

7/28/2006 12:12:00 PM  
Blogger grim said...

Corzine to lawmakers: Make history, cut taxes

Repeating that he wanted "action, action action," the governor said property taxes must not rise by more than 4 percent a year. He told lawmakers that after years of failing to cut them, "everything must be on the table" and that political leaders must be able to tackle all the most difficult political issues: "the sacred cows, third rails, 800 pound gorillas."

That includes potential tax increases, prodding towns and schools to merge, cutting public employee pension and health benefits, allowing towns to assess other taxes or impact fees, and changing how New Jersey funds public education.

"It will take years to fully correct the situation but it is absolutely imperative that we begin today," Corzine said in a 30-minute speech interrupted nine times by applause. "The property tax burden is simply overwhelming to our citizens and their economic well-being. If we were a business, we would be bankrupt."

7/28/2006 12:13:00 PM  
Anonymous Anonymous said...

From my political machine experience, this is what I saw as it will relate to local property taxes generally:

The carrot: $250M/yr for regionalization/consolidation of services

The stick: No state aid for towns that do not consolidate/ 4% cap on property taxes, so even if you keep your 100 cops for a 5,000 people town -you won't be able to afford it in 3 yrs / And if you don't do as I say, I will charter a constitutional convention which would eventually put thru deeper cuts on perks (double dipping,etc) because the ones running it will be people like Steve Lonegan -the crazy right winger blind & bitter mayor of Bogota in Bergen County.

Take it or leave it.

7/28/2006 02:35:00 PM  
Anonymous Anonymous said...

PS.I nearly forgot --A hidden thing to enhance local revenue & possibly stop sprawl, that is very easy to oversee - Is allowing localities to assess impact fees. So Mr.Developer you want to build those townshouses - please fork over $5 million for school construction, & road upgrades.

7/28/2006 02:39:00 PM  
Anonymous Jung said...

Eliminate pension for all public jobs altogether. We're all grown-ups.

If they have difficult time attracting employees, then just raise the salary. But I have a feeling that even with no pension benefit, people would be still fighting over any openings for cops, teacher, and toll booth positions in NJ.

And please, will somebody jack up the co-pay to $25 minimum? I believe that amount is necessary to curb frivolous doctor visits, and also get patients to fight against doctors who demand frivolous multiple visits by the patients.

4% cap on the property tax hike sounds ok to me, but if the towns raise it full 4%/year for 10 years, it will be almost 50% nominal increase. But I think I can live with that. Certainly beats the hell out of 50% my tax bill going from $5900 in 2002 to $9200 for 2005. I nearly choked on my own head when I saw those bills.

7/28/2006 03:33:00 PM  
Anonymous Anonymous said...

The eaisiest way to correct the promblem is do away with pesnions in this state. Like Corzine said make the new government workers take a 401K and all government works should pay there own healthcare. One thing that I know he will not do is anyone receiving a pesnion should not be working at this time. And they should only be allowed 1 pesnion. For all those reciveing 5 or 6 or however many pensions, making 700K /year on them. That crap needs to end right now. Give them on pension and cap it at 100K/year. Thats a big reason why this state is so broke, we have to pay all these ridiculous amounts for pensions for the greedy scumbags. And they need to stop giving large corporations tax breaks if the agree to hire so many people per year. As if companies like johnson and johnson need a tax break. They had 24 Billion dollars to dole out to try and buy that company the was bough by Boston scientific. If there are all these large corporations in NJ making billions per year, well than why are we still in debt? Why is corzine scrounging to find money? Plus with all these a gabillion houses they have built over the past 10 or so years in this state, why are we still having money issues. Look at all that new found property tax money. I say with out NJ residents the government is nothing. I think if everyone cut there monthly property tax in half and just paid that, I think that would be fair. Come on where is all this money going????? I am not sure how many NJ homeowners there are, but if there are 1 million homeowners in NJ corzine states that the average property tax in NJ is 6000/year that 6 Billion doallars /year. Now if all those 1 Million people work and NJ government takes 10% of your pay check and lets say the average salary in NJ is 65K well than thats 6500/year 6.5 Billion dollars. So we are up to 12.5 Billion. Sales tax now 7% avearge home owner spends 10,000/year 700 Million to the government. All these big busniesses is this state have to pay taxes. Lets say there are 10 companies making 10 Billion /year thats 3 Billion they should be paying in taxes being a corporation.
So right there that 30 Billion + 12.5 Billion thats 42 Billion. So where is NJ hiding the rest of there money??

7/31/2006 04:27:00 PM  

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