Another push for local governments to share work and cut costs

NJ property-tax bills hit another record high. Will lawmakers agree on measure said to cut bills?
Credit: (AP Photo/Seth Wenig)
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Legislation intended to help local governments save money by pooling services has the potential to ease pressure on New Jersey’s soaring property-tax bills — a lofty goal for a state where those bills recently hit a record high.

Among other provisions, a measure that cleared the full Senate last week seeks to address technical hurdles including civil service rules that can often block local governments from sharing services and then potentially spending less.

How quickly the bill moves in the Assembly remains to be seen. But this is the time of the year when a flurry of legislative activity can occur swiftly in Trenton as lawmakers negotiate and draft a new annual budget before a July 1 deadline.

To be sure, the pandemic is expected to continue to be an important issue in New Jersey for months to come, despite economic restrictions being eased and emergency orders pulled back amid an overall improving public-health outlook. But taxes in general, especially property taxes, are always a key concern in New Jersey.

“Identifying and implementing government efficiencies that will produce cost savings for taxpayers is more important than ever as we seek to recover from the economic hardships suffered by so many businesses and people as a result of the pandemic,” said Senate President Steve Sweeney (D-Gloucester), a primary sponsor of the bill that moved through his chamber last week.

Election-year pressure

This year, there may be  added pressure on Gov. Phil Murphy and lawmakers to do more to address the state’s soaring property-tax bills, even though they are levied solely at the local level. Murphy, a Democrat, is seeking reelection, and all 120 seats in the Democratic-controlled Legislature are also up for grabs this November.

The 2021 election season comes on the heels of another increase in the average statewide property-tax bill, which reached a record high of $9,112 last year. Poll results released last month by the Monmouth University Polling Institute also revealed some potential reason for concern for Murphy and other incumbents.

Just 14% of those surveyed said Murphy’s policies have helped property taxpayers, versus 46% who said they’ve hurt property taxpayers, according to the poll.

READ: NJ property taxes climbed again in 2020

WATCH: Average property-tax bill in NJ over $9,000

In 2018 a group of nonpartisan state policy experts were asked by Sweeney to scrutinize government spending practices and offer ways to save money through reform. Among their many recommendations was a call to address civil service rules that can often stand in the way of well-intentioned efforts to share services.

The legislation that passed the Senate last week, inspired by the group’s “Path to Progress” report, seeks to make it easier to sort out civil service disputes when employees whose jobs could be affected by a shared-services agreement are reorganized. Among other provisions, the measure seeks to expedite any disputes involving civil service rules or tenure provisions so they don’t stand in the ways of savings.

Pressure on municipalities

But the current draft of the measure would also up the stakes for some municipalities in New Jersey that aren’t already engaging in shared services by setting conditions for removing state aid if local officials ignore well-documented savings opportunities.

“Sharing public services as a way to govern more responsibly is not a new concept in New Jersey, but it is more important than ever, especially today when local governments are striving to deliver services in the midst of a pandemic,” said Sen. Vin Gopal (D-Monmouth), a co-sponsor of the bill.

For his part, Murphy, since taking office in early 2018, has frequently emphasized shared services to address New Jersey’s rising property-tax bills. Last month, his administration highlighted a shared-services training program that’s being offered through the Department of Community Affairs to officials in all 21 counties to encourage more regionalization.

Murphy’s budget proposal for the 2022 fiscal year, which begins on July 1, also calls for upping state aid to K-12 school districts, funding that has the potential to ease pressure on local property taxes since many communities foot much of the bill for local schools.

“The investments we’ve made in our public schools, and other policies we’ve pursued to help communities smartly grow and redevelop, have been made because we know that finally tackling the issue of property taxes requires a keen focus on the core drivers of property taxes,” Murphy said in his budget address earlier this year.

Murphy’s proposed school-funding increase echoes prior legislative efforts to do the same and is expected to breeze through the Legislature later this month as Murphy and lawmakers negotiate a final version of the annual budget before the July 1 deadline.

Sweeney’s move

The Senate is leading with the Sweeney property-tax bill while also pressing ahead on school regionalization and special education efforts that could also impact property taxes, if enacted. In the Assembly, which is led by Speaker Craig Coughlin (D-Middlesex), the focus is also on promoting shared services and increasing aid for local schools, among other efforts, said Kevin McArdle, Coughlin’s spokesman.

Credit: (Edwin J. Torres/ NJ Governor’s Office; CC BY-NC 2.0)
Senate President Steve Sweeney: The Senate is leading with Sweeney’s property-tax bill.

While he did not identify any specific concerns that could be holding up the Sweeney bill passed by the Senate last week, McArdle said Coughlin “continues to work to build a consensus with the sponsors.”

“The Speaker strongly supports shared services and working to control property taxes,” McArdle said.

“As we have each year, the Assembly worked to control property taxes through increased school aid as well as increased eligibility and funding for the Senior Freeze and Homestead Rebate programs, among other things. The Assembly will continue to look for other ways to control property taxes,” McArdle said.

Marc Pfeiffer, a former deputy director of the state Division of Local Government Services who now serves as the assistant director of Rutgers University’s Bloustein Local Government Research Center, said local governments in New Jersey are facing a lot of pressure coming out of a major pandemic.

With much of the low-hanging fruit already plucked after decades of emphasis on shared services, Pfeiffer suggested finding new savings opportunities will be a “hard thing to do” in many places.

And while the recent Monmouth poll suggests some dissatisfaction among residents with Murphy’s handling of property-tax issues, Pfeiffer — one of the policy experts who helped draft the “Path to Progress” report — pointed to another recent Monmouth poll that suggested many in New Jersey still view the state and its communities generally as a good place to live.

“The public has conflicting views,” he said. “People like where they live, they like the services they have (and) those services are paid for through property taxes.”

WATCH: Murphy administration to increase school funding by $700 million

READ: Another tilt at enticing NJ local governments to share services

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