NJ Gov. Corzine Preparing To Gut Property Tax Relief

Just as I've been warning for some time, the Democrat is looking to can the property tax relief plan because it's the last thing not nailed down to the floor and is discretionary spending. Never mind that it was supposed to be paid for via the increase in the sales tax rate, but now that money is so tight in the state, property tax relief is about to go into the circular file.

The governor has repeatedly said all options, including rebates, are on the chopping block as he tries to balance New Jersey's finances, though he has so far declined to discuss rebates specifically. But behind the scenes, discussions on how to trim the rebates are occurring daily, the sources said, because there are very few budget areas left to cut that could save hundreds of millions of dollars.

Corzine spokeswoman Deborah Howlett declined to provide details on the rebate changes today, but said "all options are on the table."

Senate President Richard Codey (D-Essex) said he would prefer to see the rebates left intact, but "in these times, I think nothing's sacred and nothing should be."

"That has to be on the table like everything else, but I would advocate retaining that senior rebate. They depend on it so much that it would disrupt their financial life," Codey said. "The rest of them you take a look. I'm not saying you do it, but it's a big chunk" of the budget.

Assembly Speaker Joseph Roberts (D-Camden), one of the leading advocates of the rebates, declined to comment.

The rebate program, which provides relief in a state notorious for high property taxes, was already cut by $382.5 million in the $32.9 billion budget Corzine signed in June. That reduced rebates for households earning $100,000 to $150,000 to an average of $665 and eliminated them for households making over $150,000. Households earning up to $100,000 received checks averaging $1,115. Tenant rebates also shrank, from as much as $350 to $80.

When checks were mailed out last fall, Corzine said that despite the cuts, "we were able to preserve rebates for 90 percent of last year's recipients." That was before it was clear the state had a $3.6 billion deficit in its current budget.

The governor has since proposed $1.3 billion in emergency mid-year cuts -- $812 million last month and $472 million this week -- to deal with a dramatic drop-off in revenues.

Think of this as not a tax rebate, but a tax hike of more than $665 or $230 for renters. That's tax relief that was supposed to come from sales tax revenues that is now going to other purposes to shore up the state's bloated budget. It's taking still more money out of your pocket to fund the state's operations.

This is an ongoing shell game in Trenton, and the state still refuses to deal with cutting spending, and instead looks at tax hikes as the solution. All this does is further cause revenues to drop because the state becomes ever more unaffordable and residents have a bigger bite of their pay go to the state in taxes, which could have otherwise been spent on businesses and items that bolster a wide range of other taxes - including payroll tax, corporate income tax, sales tax, and real estate transfer taxes. This is yet another sign that the Democrats can't understand basic economics and that the only way to solve this mess is to encourage economic development, not stifling it with taxes.