From New Jersey Newsroom:
Contending a cap on property tax hikes needs “realistic numbers,‘’ Senate President Stephen M. Sweeney (D-Gloucester) Monday will introduce a proposal to set a cap at 2.9 percent instead of the 2.5 percent sought by Gov. Chris Christie.
The cap issue is expected to be decided before the Legislature adjourns for the summer at the end of the month.
The Sweeney plan would allow for “cap banking,” meaning that communities that keep increases below the cap would be able to set-aside the difference for future use should an emergency arise that would require a budget to increase property taxes above the cap.
“Certainly, New Jersey needs a solid cap, but it has to be a realistic cap based on realistic numbers,” Sweeney said. “We have to accept that New Jersey is not Massachusetts, where their cap has been met with uneven reviews. We need a cap that will fit the needs of our state and our communities, and this is a proposal that does.”
Sweeney argues that since New Jersey implemented a 4 percent in 2007, property tax increases have dropped demonstrably. He said last year, property tax increases averaged 3.3 percent. Before the cap law was enacted, increases averaged roughly 7 percent.
“The current cap law has been a success, but that doesn’t mean we can’t improve upon it,” Sweeney said. “If the cap can contain property taxes to their lowest increases in a decade, then a tighter cap can definitely push increases well below the governor’s magic 2.5 percent goal.”
Sweeney said that allowing communities to bank against the cap would give them greater long-term flexibility. He said towns and school districts would be more apt to budget below the cap if they know they can tap into the difference should an emergency arise.