Corzine Warns Property Taxpayers to be Skeptical of Savings

Where were these kinds of articles before Gov. Corzine signed into law this property tax reform that actually has enough loopholes to drive through crushing property tax increases despite the claims that this will solve some of the state's problems?

But people will have to wait at least several years to see the results of more substantial reforms to New Jersey's property tax system that grows over 7 percent a year, Governor Corzine said after he signed the measures.

Residents have heard lawmakers promise for decades that change will come, and they have a right to be leery of these new actions, despite the coming payments that could average $1,000, Corzine said.

"I'd be skeptical too, if I was a taxpayer. Until I see the results, it's show-me time," Corzine said, adding that those results will take years to happen. "The reforms take time. It's not one of those things where you're going to get instant gratification."

The measures signed Tuesday bring to a close the Legislature's special session on property tax reforms, launched in July. Corzine and Democratic leaders pledged to enact significant changes to the property tax system by December, but that deadline came and went with enactment of a handful of mostly minor changes. This year, Democrats regrouped and focused on the bills Corzine signed Tuesday.

The first provides a 20 percent tax credit for homeowners who meet income guidelines. It also caps local tax bills at 4 percent a year, although several costs, such as negotiated pay raises and insurance, will not be counted toward the new cap. It is not an iron- clad cutoff, either -- voters can agree to raise taxes beyond the 4 percent and state officials still have discretion to approve higher rates.

For most residents, the tax credit will be the biggest and most visible change in the coming months. Homeowners earning $100,000 or less will see a credit of about 20 percent of the property tax bill paid in 2006. Higher income households will receive a smaller credit and none will be provided for those earning more than $250,000.

So, the cap on local tax increases isn't a hard cap, but permits municipalities to raise taxes above the 4% cap to cover certain costs, and even then, state official have discretion to approve higher rates.

The state continues to play a shell game on its fiscal situation and that property taxes will continue to rise at or above the rate of inflation despite this so-called reform shows that the situation is far from under control.