The tired phrase “dead on arrival,” which politicians often use to dismiss legislation with which they disagree, wasn’t good enough for Gov. Chris Christie when describing Tuesday’s proposal by the state’s municipalities tothrough a revamped income tax.
“I don’t think I’ve gotten a copy of the report yet, but when I do, I’m going to throw it in the garbage can where it belongs,” Christie said yesterday during a press conference to celebrate the reopening of a Monmouth Beach school damaged by superstorm Sandy.
“As long as I’m the governor," he added, "we’re not going to do that kind of garbage. It’s just ridiculous.”
He was reacting to a report by the New Jersey State League of Municipalities’ Property Tax Reform Task Force that recommends changing the income tax structure and eliminating popular tax-relief measures to generate about $6 billion and spending that to reduce most homeowners’ property tax bills by 35 percent each quarter.
His lack of support for the plan was similar to what municipal officials heard when they unveiled it, but was delivered in Christie's inimitable manner.
Labeling the proposal “the same old Trenton game,” Christie criticized Bill Dressel, the league’s executive director who has been there for almost 40 years, and President Janice Mironov by name, as well as “all those other people at the League of Municipalities.”
He called them “a bunch of the biggest self-serving people I’ve seen in public life” and further seemed to target Dressel in saying, “He’s a whiner and a moaner and a complainer. He never supports anything, except for what puts money in the pockets of his elected officials.” The league, which represents the state’s municipalities before the Legislature and provides municipal officials with information about bills and laws, supported the pension and health benefits reform legislation that Christie signed three years ago. The group has been pushing for major property tax reform since 1995.
“Property taxes continue to be the major concern of the people of New Jersey,” said Jon Moran, a league lobbyist. The report “describes one path to reducing property taxes, without increasing municipal budgets at all. It is not meant to be the last word, or a take-it-or-leave-it proposition."
He continued, "We hope that it will serve to begin a dialogue on property tax reform, which the league has championed for decades. Our efforts on property tax reform have been supported by mayors all around the state and have been respectfully recognized by legislators on both sides of the aisle.”
The result of a 4-year effort, a league task force suggested the state make New Jersey’s income tax structure similar to the federal rate structure so that all income is taxed at the rate of the bracket in which a person’s income falls, while reducing slightly the highest brackets.
The program also would no longer allow property taxes to be deducted from income taxes and would eliminate the property tax benefit program, formerly known as rebates, and Senior Freeze.
Designed to be revenue-neutral, the change would allow the state to cut the total $26 billion property tax bill by about $6 billion. That would allow for a 35 percent reduction on up to $20,000 in property taxes on a principal home. The league estimates the change would reduce by $2,700 the property tax bill on the average home, whose taxes are now $7,700.
Christie said the plan would inevitably fall short as officials spend more.
“Every one of these things, they always say, are going to be revenue neutral and they never are,” he said. “They never are, because it’s never enough.
“The only way you’re going to reduce property taxes in this state is to reduce spending. That’s it.” Christie said property taxes have risen on average by less than two percent a year in each of the past two years because of the 2 percent property-tax cap that the Legislature passed and he signed.
But for some people, the amount of net property taxes paid has risen by more than that because Christie also reduced the number of people getting a tax reduction under the Homestead Benefit program -- non-seniors are eligible only if their income is $75,000 or less -- and cut the amount of the benefit received.
The municipalities’ report suggests that putting more of a burden on the income tax would be fairer because it is based more on an individual’s ability to pay. Further, New Jersey’s income tax is the lowest in the nation for families with an income of between $12,000 and $80,000.
The property tax, in contrast, is more regressive and less fair, because a person who has lived in a large home for a long time may find himself or herself facing a high tax bill that is hard to meet because the house has appreciated in value but the owner is now retired and on a limited income. New Jerseyans have complained about high property taxes for decades – polls typically rank it as the biggest problem facing the state – and lawmakers have studied it but have been unable to stop taxes from rising significantly for more than a few years at a time.
Christie painted the league’s proposal as self-serving. “This is mayors and council people . . . who care only about themselves,” he said. “They want to make their lives easier, so what they are saying is take more money out of the taxpayer’s left pocket, keep a bunch of it, and then put less back into the right pocket and try to convince them that they’ve reduced taxes.”
Municipal officials on Tuesday said that if Christie and the Legislature do not cut property taxes by at least a quarter, they would support a constitutional convention to create a proposal that citizens could vote on. Such a convention is controversial because of the question of what those elected to attend would propose and how voters would react, but one lawmaker who was present, Assembly Majority Leader Louis Greenwald (D-Camden) supports the idea and has introduced a bill calling for such a convention.
Christie did not address the question of a convention yesterday, but he did toss a parting shot at the league: “The League of Municipalities, as far as I am concerned, can go out of business because all they do is put out stupid reports like this and run corrupt conventions every year in Atlantic City, where I arrested more people when I was U.S. attorney than at any other spot over the course of time.”