Property taxes: Christie won’t sign Democrat bill to extend key law, Republican lawmaker says

Property taxes: Christie won’t sign Democrat bill to extend key law, Republican lawmaker says (via NJ.com)

TRENTON — A fight over renewing a law crucial to holding back an increase in property taxes is nowhere near resolved, a Republican lawmaker who has led the fight for retaining it said today. Although the Democrat-led Legislature last week began advancing…

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The Dismantling Of Christie’s “Bi-partisan” Reforms

photo credit: Tim Larsen/Governor’s Office

It’s beginning to look like Governor Chris Christie’s Boulevard of Compromise is a dead end.

The 2% property tax cap is under attack, as the Trenton Democrats are on the verge of passing an “extension” of the Interest Arbitration Award Cap that eliminates the cap on most arbitration awards and increases the cap on the remainder of the potential awards by 50%.

In my piece last night about the Interest Arbitration Cap, I raised the hope that published reports that Assembly and Senate committees cleared an identical bill that guts the cap were inaccurate because Senator Mike Doherty was co-sponsor of the Senate bill and because of Senate President Steve Sweeney’s comments about the cap at his Town Hall Meeting in Keansburg last week.  It turns out that was wishful thinking. MMM has learned the bills are identical and, inexplicably, Doherty is a primary sponsor of the Senate bill, giving Sweeney and Assembly Speaker Vincent Prieto “bi-partisan” cover.

Doherty has yet to return our call for comment.  We’ve been told his attitude about the bill he is sponsoring with Sweeney is “a bill that will pass is better than no bill.”

Doherty has a point, albeit a minor one.  If no bill passes by April 1, there is no cap on Interest Arbitration awards at all.  If the bill that cleared through committees yesterday passes the full legislature and is signed by Christie, there will be a 3% cap on a minority of municipal government labor contracts for the next few years.  If Christie vetoes the bill, even conditionally, there is no arbitration cap.  Either way the property tax blaze is about to be reignited and/or the pain inflicted upon municipalities will be so great that consolidations and mergers will be forced indelicately.  The backdoor destruction of municipal governments appears to be Sweeney’s undeclared plan.

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Trenton Democrats Poised To Blow Up The Property Tax Cap

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.

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