New Jersey property taxes will likely resume the double digit annual growth that occurred under the McGreevey, Codey and Corzine Administrations if Assembly Speaker Vincent Prieto’s version of the of the Interest Arbitration extension becomes law. Either that, or municipal governments as we know them will cease to exist, succumbing to a long and painful death of higher crime and reduced services and capital improvements.
A 2% cap on interest arbitration awards in labor disputes was a key component of the 2% property tax cap negotiated between Governor Chris Christie, Senate President Steve Sweeney and Prieto’s predecessor, Sheila Oliver in 2010. It worked. Arbitrators made awards of less that 2% to police and fire fighters unions and property taxes rose less than 2% per year over the last four years.
The problem is Oliver insisted that the arbitration cap expire on April 1, 2014. Now, we’re a week before the arbitration cap expires and Prietro is gutting the cap by passing an extension of the law that exempts contracts that were awarded less than 2% during the last three years from any future caps and raises the cap to 3% on contracts that have not been negotiated since 2010.
The math will never work. If property taxes stay capped at 2% but the primary cost of property taxes, salaries, are not capped or are capped at 3%, municipal services will disappear. Police will be laid off, with the junior, lower paid officers being let go first, leaving the older and more highly paid officers to run drown the inevitable increase in crime. Towns will go bust. The state will take over municipal governments and force consolidations.
Belmar Mayor Matt Doherty Photo Credit Mark Bonamo, NJ.com
Belmar Mayor Matt Doherty and his colleagues on the Borough Council are acting on their pledge to rebuild the town’s boardwalk by Memorial Day 2013.
NJ.com reports that the governing body introduced a $20 million bond ordinance last week to provide the initial funding of the reconstruction.
Doherty said that Belmar’s property taxpayers will not be on the hook for the cost of the new boardwalk, with FEMA and the borough’s beach utility, which is funded by beach badge fees, paying off the bonds.
“It’s our understanding is that FEMA will pick up 75 percent of the expense, based on the language coming from the White House,” said Doherty, 39. “The remaining amount will come from the beach utility itself. So if you don’t use the beach, you’re not paying for anything. And zero dollars are coming from residential property-tax payers, with no property-tax hike anticipated.”
Beach badge prices are expected to rise from $7 to $8 for daily passes and for $50 to $55 for seasonal passes.
The mayor, a Democrat, had kind words for Governor Christie, but not so kind words for another Doherty, State Senator Michael Doherty. The senator has proposed legislation that would eliminate a beach town’s ability to sell beach badges if state or federal funds are used to rebuild from Hurricane Sandy.
“I think Gov. Christie has done an outstanding job in his leadership, and one of the things he’s been very effective at is keeping politics out of anything related to the Hurricane Sandy recovery efforts,” Doherty, a Democrat, said. “I wish that Sen. Doherty would follow Gov. Christie’s lead as well. It’s nothing more than trying to score cheap political points after arguably the worst natural disaster that our state has ever experienced.”
The bond ordinance is expected to be passed at the December 3 meeting of Belmar’s council.
On November 6th, New Jersey voters should vote NO on Public Question #1, which seeks authorization for the state government to borrow $750 million “to build, equip and expand higher education facilities.” The New Jersey Constitution does not allow our state government to borrow money unless the voters approve. As a result, the state legislature was forced to put the $750 million borrowing plan on the November 6th ballot in the form of a public question.
The United States federal government is drowning in debt. Earlier this year, our national debt surpassed $16 trillion. According to the Congressional Budget Office, this debt problem will only grow worse in the future.
Like the federal government, New Jersey state government is also drowning in debt. According to its Comprehensive Annual Financial Report, New Jersey state government has over $40.5 billion in outstanding debt. According to www.StateBudgetSolutions.org, when other obligations such as future pension and health benefit payments for public employees are included, New Jersey state government has a total debt of $258 billion. New Jersey’s total debt is now the fifth highest in the nation after California, New York, Texas and Illinois. That debt burden comes to about $30,000 per resident, or about $120,000 for a family of four. County and municipal debts add even more to the total government debt burden facing New Jersey residents.