Is Jersey’s tax revolt a joke?

1/31/10

One of the most influential philosophers in Western Civilization, Georg Wilhelm Friedrich Hegel, once said, “People are part of the state that does not know what it wants.”
While he wasn’t talking about New Jersey voters, he should have been – especially regarding the recent election and their outrage over increased taxes.
Gov. Christopher Christie rode into office on the back of anti-property tax movement, a powerful revolt that has been ongoing in New Jersey since the 1970s.
General Property Tax – as it is properly known – was once called “the worst tax in civilized history.” It is the chief revenue source for local government – not state government – and is responsible for paying your town’s police, firefighters, schoolteachers, and a variety of municipal workers who actually do the day-to-day chores people expect of government.
But it is a very difficult tax to administer, several experts claim, because of a fundamental change in definition of what property tax is. Real property – which is land and buildings – is easy to figure out, but over the years, personal property has become part of the assessment in some cases, including furnishings, improvements, and other tangible and intangible items. This system of taxation has led to favoritism and inequalities. A few years ago, a reporter from a small town in North Jersey noted that large homes owned by some of the town’s favored families were assessed at less value than some of the poorest homes in the same community.
Education is an even bigger problem. The value of people’s homes often goes up when they have a highly successful education system, but so does the cost of hiring the best teachers and teachers’ aides, and the cost if they want to keep class size small.
In New Jersey, property taxes provide almost half of what municipalities need. Contrary to popular conceptions, none of this goes to the state. However, the state gives aid to municipalities to offset a potential tax increase.
“Cities don’t give to the state; the state gives to cities,” one local official said.
It is an illusion to believe that state government can cut property taxes by cutting state jobs and state programs. The state gets your income taxes, not property taxes. However, the state government has two powerful tools for curbing taxes on a local level. One is to increase state aid to a town, so the town needs less tax money. The other way is to cap spending increases, forcing towns to cut personnel or services.
If aid were shifted, it would likely still go to municipalities who are in political favor. Thus, aid that previously went primarily to the cities under Democratic Gov. Jon Corzine would likely go to Republican strongholds in places like Monmouth County instead, helping them cut their taxes. The cities that lost aid would have to lay off workers and police to keep taxes low.
However, this would only slow the bleeding that taxpayers face, since even with federal pass-through grants and tax relief, municipal budgets would still rise unless towns cut at the same rate.
The other method of cutting property taxes is to impose a spending cap. Christie is proposing to cap increases in spending to 4 percent for each municipality with no loopholes, a mandate that the state can impose since all municipal budgets are subject to state guidelines. The current average increase is over 7 percent. This means that even politically favored municipalities will be hard-pressed to cut revenues and will have to cut services and jobs – not state jobs, but municipal, school, and county jobs.

Stack and Sacco eye each other in anticipation of redistricting

Sources close to state Sen. and Union City Mayor Brian Stack claim he is still pondering whether or not he intends to make a move to become the next chairman of the Hudson County Democratic Organization.
Stack, of course, led a failed bid against the HCDO a few years ago, but it is a different HCDO today, weaker and less influential.
The old political order in Hudson County seems to have changed drastically with the last election, as Stack and state Senator Sandra Cunningham take on new leading roles.
Stack and state Sen. and North Bergen Mayor Nicholas Sacco are said to meet frequently, not because they like each other, but because each wants to keep a closer eye on the other.
Both are waiting for the 2011 redistricting that could actually rob Hudson County of one of its three existing state legislative election districts as population numbers are reconfigured.
While it is unlikely that Sacco and Stack will wind up in the same district, both are more than a little nervous to test their political army against the other in the event that the boundaries of the 32nd District Sacco represents slip off the side of the western slope into Bergen County.

Poster child of Democratic corruption

Even if Jersey City Deputy Mayor Leona Beldini manages to get an innocent verdict in her corruption trial, the damage is done. She has become the statewide poster child for Democratic corruption, as her story appeared in the front pages of papers from Port Jervis to Cape May. During the election that propelled Christie into the State House, corruption ads appeared even in so-called safe Republican districts, and you can bet that this will play a big role in the state election in 2011 when Republicans seek to take back the state Senate and Assembly.

D’Amico resigned county job

Apparently last week this column jumped the gun on saying that newly appointed Bayonne City Attorney Charles D’Amico had taken a leave of absence from his county position. According to Donato Battista, counsel to the county executive, D’Amico’s resignation has been finalized. Sources in the county had previously claimed there had been unresolved issues, but these were apparently resolved, allowing D’Amico to resign his county position.

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