What cap?

From the Record:

Property tax cap growing weaker across North Jersey; more towns than ever exceed 2% limit

Reforms enacted in 2011 to keep the nation’s highest property taxes in check are showing signs of weakening as a growing number of New Jersey towns fail to stay within the 2 percent cap on increases that formed the cornerstone of the effort.

Recently released tax data show that, four years after Governor Christie and the Legislature reached the landmark bipartisan deal imposing the cap, 60 percent of the state’s municipalities exceeded it in 2015, an analysis by The Record has found. The actual number — 334 of the state’s 565 municipalities — is higher than it has been at any point since the reforms were passed, as communities use exemptions in the law to surpass the limit, the analysis found.

While most tax increases across the state are nowhere near those seen in the years before the accord, last year’s count of towns surpassing the cap was up from 225 in 2012 and marked the third year in a row that the number grew, a sign of the mounting struggles localities face in containing rising costs.

Municipalities managing to stay within the limit last year included only 21 of the 70 in Bergen and four of the 16 in Passaic. Those numbers also are at or tied for their lowest points since the ceiling was imposed, according to the analysis.

To be sure, from a long-term perspective, there is little indication that towns are reverting in large numbers to the time before the cap was set, when tax levies commonly rose 5 percent or more. But the total amount of tax levied to pay for town and county services, as well as public schools, rose by at least 3 percent in a third of the municipalities across North Jersey and statewide in 2015.

Topping last year’s tax increase list in Bergen and Passaic, with hikes of more than 5 percent, were Edgewater, Englewood Cliffs, Rochelle Park, Haledon, Prospect Park, Totowa and Woodland Park. The broader trend boosted the average residential property tax above $10,000 in 49 municipalities in Bergen and Passaic counties, up from 33 in 2010.

Among the exemptions are increases from rising employee health insurance premiums, borrowing for major construction projects, increased school enrollments and emergencies such as hurricanes or major snowstorms. A town also can exceed the cap in a given year if it stayed under the cap in the prior three years, according to the Community Affairs Department.

Representatives of local governments say the need to use the exemptions to boost taxes will continue as costs subject to the cap — mainly salaries and maintenance of public buildings — keep rising, giving officials less and less wiggle room to keep levy increases to 2 percent.

“I would say it’s likely to continue. Absent favorable events elsewhere, more towns will be forced to use the exceptions and go over the 2 percent cap,” said Jon Moran, senior legislative analyst of the New Jersey League of Municipalities. “I wouldn’t guess at a percent, but I think it will increase.”

Adding further to the fiscal pressure are changes in the way annual health-insurance premium increases — which often top 5 percent — are shared between local governments and their employees. After a period in which higher employee contributions were phased in, upcoming increases are likely to be borne more by towns, counties and school systems.

This entry was posted in New Jersey Real Estate, Politics, Property Taxes, Unrest. Bookmark the permalink.

7 Responses to What cap?

  1. Comrade Nom Deplume, Newspeak Editor says:

    Frist. And back to bed.

  2. yome says:

    American households today earn about the same as they did 20 years ago (once you adjust for inflation). That makes it hard to get ahead, especially for indebted families.


  3. Jerzy Trumpista says:

    5 to 10 yrs prediction addressing the property tax issue.

    Right now Senate President Sweeney is pulling a hard left after having sold his soul to the Christie pension changes and then seeing Christie welsh on them, making him look bad.

    If Sweeney becomes the next governor, I expect the following basic restructuring formula. All these restructuring are in his political boss Norcross’s wish list and he’ll profit from it dearly. All of them will pull power from local city/town government and any of its political machines, into the new regional entity. All of them would reduce cost of property taxes and pension issues through restructuring into new entities, therby getting rid of old contracts, old employees with old pension liabilities.

    The model is the Camden City Police restructure to County Police model. In it only 49.99% of the old City cops could come over to the new agency. Guarantee you these were the political connected hopefully non-crooked and younger ones. New rules, less benefits, no union to start. New agency answerable to county government. So far it has proven extremely successful. Same money double the amount of cops. Mostly younger (and way cheaper), better equipped and supervised.

    Expect the model across all the expensive government operation areas and geographies. It’ll start in the notorious big cities that everyone hates. The next one on the list is Atlantic City.

    Get use to seeing names like Atlantic County, Newark-Essex, Paterson-Passaic, Jersey City-Hudson with the adjectives of Metro Police, Fire or Educational District afterwards.

  4. dentss says:

    Jerzy …It will take a lot more than that to tame the property tax monster ,it’s the schools that are over 60% of our bills …plus county tax is now creaping to close to 20% which is just about the mini level ……

  5. grim says:

    Does our cultural appropriation offend the Irish?

  6. Essex says:

    Cats win the SEC and a man’s mind goes to flights of fancy.

  7. Essex says:

    Anyone for a cabin in the woods?? Lakefront living. Cheap-ass taxes.

    Kentucky is your place.

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