The 2% Question: Will Murphy Sign on to Cap Waiver?

Some 40 school districts across New Jersey could bypass state’s property tax cap under bill awaiting governor’s signature
Senate President Steve Sweeney

12/20/2019 13:40 PM  Update: Gov. Phil Murphy’s office said on Friday that he still opposes the measure and plans to veto the bill. NJ Spotlight will have more detail when we return to full coverage on Jan. 2.

With millions of dollars in education spending hanging in the balance, Senate President Steve Sweeney made a bet in offering an olive branch to school districts facing deep cuts in state aid.

But it’s still wait-and-see if Gov. Phil Murphy will go along with it.

On Monday, both the state Senate and Assembly approved bills that would provide a waiver for certain districts to exceed caps on local property tax increases in the face of state aid cuts arising under Murphy’s and Sweeney’s push for leveling out the state’s school funding system.

The number has been fluid as to how many districts would be affected, with Sweeney’s office saying 40 districts would be eligible for the waiver.

But Murphy has so far opposed the proposal, saying it would lead to state-imposed property tax increases. He has instead used his veto power as leverage for his push for higher income taxes on all millionaires to make up the funding deficits.

Murphy’s office Thursday was silent on whether he would sign the latest bill. Sweeney on Monday said there had been little communication with the governor so far and he was holding out hope, although with no promises.

“We’re trying to get 40 districts the ability to catch up,” Sweeney said after the votes Monday. “If [Murphy] chooses not to, we’ll go from there.”

The Senate Majority office on Thursday provided a preliminary list of districts likely to come under the proposal, allowing them to waive the 2% on cap on property tax increases without a separate approval of the voters.

The districts are each below what the state’s funding law deems as adequate funding levels for their schools, but at the same time face cuts in state aid due to enrollment or other decreases.

The latest list includes the following:

  • Bradley Beach
  • Brick Township
  • Clearview Regional
  • Freehold Regional
  • Haddon Heights
  • Harrison (Gloucester County)
  • Hillsborough
  • Lakewood
  • Leonia
  • Lower Township
  • Manalapan-Englishtown Regional
  • Middle Township
  • Old Bridge
  • Point Pleasant Beach
  • Somers Point
  • South Brunswick
  • Toms River

The state’s main education groups, including the NJEA, have each supported the bill as needed relief to districts.

The chief lobbyist for the New Jersey School Boards Association Thursday said he thought Murphy’s camp would go along, but he too was making no promises.

“I think they are starting to understand what the bill actually does,” said Michael Vrancik, director of government relations for the association. “I think it is starting to sink in and there has been a softening in their position.”