(AP) The number of New Jersey residents getting property tax relief would nearly quadruple to almost 2 million people under a plan Democratic Gov. Phil Murphy unveiled on March 3.
The governor’s proposal will be part of the new fiscal year budget he unveils next week to the Democrat-led Legislature. He pitched the new plan at an event in Fair Lawn, part of an effort to concentrate on affordability since a narrow election victory in November.
“We believe that we must take action to offset costs and make life in New Jersey more affordable,’’ he said.
The proposal adds assistance for renters, who were previously excluded from the state’s current the benefit.
Under the new plan, homeowners making up to $250,000 will be eligible to get a credit toward their property taxes of up to $700 in the fiscal year beginning July 1.
Renters who make up to $100,000 would get rebate checks — since they don’t pay property taxes directly — of up to $250.
Overall the governor’s proposal could benefit 1.8 million residents, up from the 470,000 who currently get the property tax assistance.
The program carries a $900 million price tag, which would grow to $1.5 billion by 2025, with the aim of increasing the average benefit to $1,150 a year.
It’s a fraction of the state’s more than $46 billion budget, and the governor aims to make this an annual program.
But that requires lawmakers to renew it each year in the budget. That means, for example, if state revenues fall or a recession hits, the program could be on the chopping block.
Republicans are in the minority in the Legislature and have long pushed back against Murphy’s agenda, particularly higher taxes on the wealthy and businesses. They see more state spending to alleviate property taxes, which are levied locally, as a failure to cut town and county expenditures.
“Governor Murphy is using over-taxation as an excuse to cloak over-taxation. Municipal spending can be cut by billions of dollars instead of spending billions at the state level,’’ Republican Assembly Leader John DiMaio said in a statement.
Senate Republicans want to pass a $3 billion package they say would give back excess tax collection to residents in the form of $500-$1,000 refundable tax credits on their income taxes.
“We want to give this unexpected and unneeded windfall back to New Jersey families who are struggling to get by with surging inflation,’’ Senate GOP Leader Sen. Steve Oroho said.
Messages seeking comment were also left with Assembly Speaker Craig Coughlin and Senate President Nicholas Scutari.
Currently, the average property tax benefit is $626, with eligibility limited to homeowners making $75,000 or less if they’re under 65 and not blind or disabled. Those older than 65 or who are blind or disabled face a $150,000 income cap currently.
New Jersey’s annual average property tax rate is nearly $9,300 and is among the highest in the country. The taxes are levied by school districts and local governments and pay for educational and other services. They’re perennially a political issue in New Jersey, which moved to cap annual property tax increases at 2% in 2010 under former Republican Gov. Chris Christie.
Murphy has turned more to affordability since his narrow victory against Republican Jack Ciattarelli in November after campaigning on progressive policies he delivered in his first term. Murphy long claimed that the increased aid to schools in his budgets amounted to property tax relief. More state aid to schools lessens the burden on districts and reduces the need to hike taxes, but it’s not guaranteed.
His stance exposed him to repeated attacks for failing to unveil a more comprehensive property tax relief plan. Thursday’s proposal amounts to him directly embracing property tax concerns.