New Jersey - Highest Property Taxes in the U.S.

From the AP:

Barbara Lehman has lived in this central New Jersey community for 30 years, but her time here is nearing an end.

She sent her children through Montgomery's well-regarded schools. And she enjoys the rolling landscape even as housing developments have spread across it in recent years.

But her property taxes have climbed 56 percent since 2000 to a knee-buckling $14,000 a year — a heavy load for a high school French teacher whose salary goes up only about 3 percent a year.

"Oh, it's terrible," Lehman said.

Despite efforts by governors and lawmakers to do something about it, New Jersey has the highest property taxes in America — a burden that is alarming young couples and retirees alike and deepening public cynicism in a state with a long and rich history of graft and self-dealing.

The average property owner in the Garden State pays about $6,000 a year in property taxes, twice the national average.

A recent analysis by The New York Times found property taxes increased two to three times faster than personal income from 2000 to 2004 in the suburbs surrounding New York City. New Jersey's booming Somerset County — where Montgomery is situated — got slammed harder than anywhere else in the region, with property taxes climbing 41 percent there while income increased but 5 percent.
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Susan Horowitz and her husband just marked their 30th year in Montgomery, but they are unsure how long they will be staying. Both are retired teachers who have watched their property taxes nearly double since 2000 to about $12,500 per year.

"I look at my pension as paying my property taxes," Horowitz said. "We love living here and as long as we can afford the taxes — because we've paid off our mortgage — we'd like to stay here, but we just don't know."
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Some lawmakers are looking into merging school systems and municipalities but are likely to run into resistance from local officeholders if they try to force the issue.

Another reason for high property taxes: State and local government owe billions per year to the state's public employee pension system, which has been riddled by abuses.

Also, by court order, the state must send huge chunks of school aid to struggling urban schools, meaning less money is available for middle-class districts.