Friday, July 2, 2010

“Property tax caps seen as best relief” plus 2 more

“Property tax caps seen as best relief” plus 2 more

Property tax caps seen as best relief

Posted: 02 Jul 2010 04:40 AM PDT

Once prized by Democrats and Republicans alike, rebate checks have been cast aside by Trenton politicians who now say caps on local tax increases are the best relief for the nation's highest property taxes.

Governor Christie has called the Legislature in for a special session starting today to begin deliberations on the cap he proposed in May. Christie's plan would prevent local governments and school boards from hiking taxes by more than 2.5 percent in any year. It would be guaranteed by a constitutional amendment.

Democratic legislators have their own cap initiative, a 2.9 percent limit that would also seek to check local government spending, which has increased by nearly 70 percent in the last 10 years.

Christie wants his hard cap considered by voters this November. To get the cap on the ballot, Christie needs lawmakers to approve the measure and a "tool kit" of additional reforms by next Wednesday.

"We cannot turn our attention away from this [problem] when the public is obsessed by it," Christie said on Tuesday after signing the new $29.4 billion state budget. "It's not rocket science, it's pretty common-sense stuff."

The Democrats' cap, with several exceptions that are designed to prevent the massive service cuts and layoffs that some fear Christie's effort will produce, has already passed both houses of the Legislature. Their bill needs only Christie's signature to be enacted.

But neither cap plan includes a restoration of the property tax rebate checks eliminated altogether this year in the new state budget as average property tax bills have risen to a record high of $7,281.

Yet it wasn't long ago that the Democrats created the latest version of the rebate program, one Christie viewed last year as a source of relief from rising property taxes.

Democratic lawmakers forced a government shutdown in 2006, resulting in a state sales tax increase that partially funded a record $2.2 billion rebate program that pumped out checks averaging more than $1,000 in 2007.

Assembly Majority Leader Joe Cryan, D-Union, said in 2007 — an election year for the Legislature — that the $1,000 rebate checks were "only a down payment on a long-term commitment to tax relief and tax reforms." But this year he was among the Democrats who cast "yes" votes for Christie's rebate-cutting budget.

And the governor, as a candidate in the fall of 2009, told The Record's editorial board he would restore rebates after his opponent, then-Gov. Jon Corzine, had proposed significant program reductions as he watched state revenues decline due to the recession.

"What level that will be at is going to depend on how I can make the budget work, but I want people to get some property tax relief next year because I think we'll still be in recessionary times," Christie said in October.

The budget Christie signed into law on Tuesday promised property owners only that there will be some type of credit offered in 2011.

 

A shift on rebates

 

Republican lawmakers have also changed their message when it comes to the rebates, saying this year that cutting them was an extremely difficult choice. But they roundly criticized Democrats last year for cutting back rebates that were billed as "permanent" in 2007.

"There is no value and there is no integrity in people making a commitment or a promise," Assembly Republican Budget Officer Joe Malone, R-Burlington, said last year. This year Malone sponsored Christie's rebate-free budget.

Cutting rebates will "take money out of people's pockets and continue to drive middle-class taxpayers and senior citizens to bankruptcy," Assembly Minority Leader Alex DeCroce, R-Morris, said in 2009.

This year, DeCroce blamed Christie's budget cuts on "the last eight years of the Democratic tax, borrow and spend approach which put our state on the edge of bankruptcy."

Christie acknowledged on Tuesday that his budget doesn't provide direct property tax relief right away. He said his 2.5 percent hard cap on local spending hikes and his tool kit of reforms will provide that relief.

An analysis by The Record determined property tax bills would be $1,600 lower on average if Christie's plan had been in place for the last 10 years. Instead, the average bill in New Jersey has increased by nearly $3,000.

"We spend too much at the school board and local level that we don't need to be spending on," Christie said.

But the governor will need cooperation from the Democrats to enact his cap and the other reforms because they hold majorities in both houses of the state Legislature. The Democrats, however, would prefer to see their own, less restrictive cap put in place.

A 4 percent limit with several exceptions that was enacted by Corzine in 2007 has already helped trim annual increases to 3.3 percent last year.

"We offered the governor a reasonable alternative that provides a realistic cap immediately as opposed to an unworkable plan that would not be in effect until next year," said Assembly Speaker Sheila Oliver, D-Essex. "We will listen to what the governor has to say, but hope he sees the light and signs our tougher new 2.9 percent property tax cap into law."

Cryan said Christie shouldn't expect Democrats to rush a decision on his cap plan during the special session. "We have already committed to reviewing his and other ideas over the summer in anticipation of legislative action this fall, and that will continue to be our plan, no matter how many times the governor looks to show off," he said.

Christie's take: "We get elected to decide, not to defer."

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Property tax evaluations raising some eyebrows

Posted: 01 Jul 2010 09:29 AM PDT

Tim Pratt (contact)
July 1, 2010 10:17:00 AM

The Oktibbeha County Tax Assessor's Office is in the middle of evaluating property values in Starkville and Oktibbeha County, but the assessments are raising eyebrows among some residents.

"People are getting really riled up," said Green Oaks resident Mark Henry, who also owns property outside of Starkville in Oktibbeha County.

Henry said his property in Green Oaks was valued at $100,540. That's a 23-percent increase since it was evaluated four years ago, he said.

Henry says he and other Green Oaks residents believe their properties are being evaluated at values more than what the properties are worth. With higher property values come higher property taxes, he says.

"It's basically another form of a tax increase for us that (the city and county) don't have to approve," Henry said.

Considering the national economic downturn over the past two years, Henry believes property values and home sales are down all over the country, including here in the Golden Triangle.

County Tax Assessor Pat Kight, however, begs to differ. The assessors' evaluations of properties are based on nearby home sales and other factors, Kight said. Home sales and, subsequently, property values throughout Starkville and Oktibbeha County are on the rise, she said.

"I know that some people come in and say 'Well, with the economy like it is, values have not gone up,'" Kight said. "Here in Oktibbeha County, that's not true. We have sales information telling us the recession has not hit these properties here as hard. People are still building, people are still buying ..."

Additionally, the Tax Assessor's office evaluates properties at 85- to 90-percent of market value, Kight said. Most property owners could "probably" sell their properties and get more for it than the county's assessed value, she said.

"We try to keep (property tax evaluations) as low as we can in order for it to pass the judgment of the State Tax Commission," Kight said. "I'm not trying to hurt anybody. I'm just doing what I'm required to do by the Tax Commission. I understand some people are upset and are going to be upset. Now, if they come in and talk to us, we'll explain it to them and I think most of them are going to understand what's going on."

The Tax Assessor's Office is holding hearings today from 8 a.m. to 5 p.m. for property owners who want to challenge the Tax Assessor's property evaluations. As of Wednesday, Henry had scheduled a meeting with the Tax Assessor's Office to discuss the values of his properties.

If property owners are unable to attend the hearings at the Tax Assessor's Office today, the office will attempt to meet with those property owners at a later time, Kight said.

"If we don't get to see all the people, we're not just going to cut if off and say we're not going to see anybody else," Kight said. "If they have a legitimate reason, we'll meet with them."

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Property tax debate intensifies as special session begins

Posted: 01 Jul 2010 01:46 AM PDT

TRENTON — Lawmakers convene at the Statehouse today to begin a special session called by Gov. Chris Christie regarding his property tax plan, centered on a 2.5 percent a year limit on property tax increases.

Democratic lawmakers plan to review Christie's plan over the next few months, blowing past a July 6 deadline the governor has set in his effort to put his Cap 2.5 plan before voters this November. That debate will apparently begin this afternoon on the Senate floor. They've also sent to Christie a 2.9 percent property tax cap that differs from his plan in multiple ways.

The 0.4 percentage point difference between the two plans seems narrow — it amounts to just $29 the first year, compared with a nearly $7,300 average tax bill in the state last year. Yet Christie is expected to veto the Democrats' plan.

Their fight, though, is about more than just the cost of a family's dinner at the local diner. It's also about what should be covered or excluded from the cap, whether to lock the changes into an inflexible state constitution or keep them in the Legislature's hands and what else should be done to tamp down local spending.

"To put a hard cap, with just debt service, will destroy local governments and will make it impossible for them to deliver public safety services, which then the state of New Jersey will be forced to fund," said Senate President Stephen Sweeney, D-Gloucester.

Christie said the other changes he has proposed, particularly changing civil service rules and allowing local governments to opt out, as well as barring an arbitrator from awarding compensation increases above 2.5 percent, are key.

"Cap 2.5 is just part of it. You cannot have Cap 2.5 without having the tool kit. The tool kit is absolutely necessary. They are interconnected. One will not work without the other," Christie said.

Without those changes, local governments won't be able to cope with a reduced cap without decimating quality-of-life services, said Bill Dressel, executive director of the New Jersey State League of Municipalities. He said management reforms weren't delivered in a 2006 special session that led to the current 4 percent cap.

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