New Jersey’s property tax system has been in place since 1851 and is the most expensive in the nation. It requires reform on the local level to reduce costs and cut extravagant spending to provide for those who need relief the most. The property tax is a grassroots issue affecting every taxpayer, and in spite of a decade of promises by Democrats to fix it there has been no relief. The Assembly Republicans have solutions to solve these crises:
Sharing Local Services. New Jersey has 565 municipalities, most with their own fire department, police department and school system among other local expenses. The costs to run and pay for these services has become unmanageable for small and less-wealthy municipalities. Shared services should be a completely bi-partisan approach to cutting property taxes. In Gloucester County, the first year of sharing EMS services saved taxpayers over $2.5 million, and sharing jails saves $14 million annually. Millions and millions more could be saved statewide by expanding that to other services in all counties.
Dedicate Income Tax To School Funding. A study by the state League of Municipalities found that dedicating the income tax to school funding would reduce property taxes statewide by about 35 percent. The dedication would also increase school funding by $1.3 billion if income tax revenue reaches its projection, which is nearly $500 million more than a fully funded formula. The extra school funding would protect homeowners from property tax increases in the future, making the state more affordable than it has been since the income tax was initially passed in a failed effort to lower property taxes and fund schools. This is a common sense solution that should have been in place from the beginning.
Civil Service Reform. Civil-service rules determine how public employees are hired, promoted and fired, and century-old civil service laws are a barrier to efficient local government. These laws act as a roadblock protecting underperforming employees. Often, top performers are let go in favor of those who have seniority. Further, employee preferences make it difficult for local governments to share services and save taxpayer money because fewer positions are needed. In this case, civil service laws protect a few at the expense of the taxpayers.
End Sick Time Payouts. When public employees retire, they get paid for the sick days they didn’t use. Essentially, taxpayers are spending billions to pay for their employee’s good health, even though they already paid for it. Payouts have been capped at $15,000 since 2010, but that hasn’t done enough as towns are raising taxes and borrowing money to make these payments. Considering the nearly 450,000 public employees, even a $7,500 cap could cost New Jersey taxpayers more than $3.25 billion.
If we end the payouts, New Jersey and its localities could save billions. Instead of raising taxes to try to fund these liabilities, we should be cutting the liability and putting the money toward other obligations.