Corzine Now Trying To Play White Knight For Taxpayers

After calling for a gutting of property tax relief programs to anyone other than seniors making over $75,000 in New Jersey (median income $67,000), Gov. Jon Corzine is now saying that he's going to work towards restoring much of the property tax relief programs that he decimated in his budget proposal.

Stung by public "angst" over his proposed budget, Gov. Jon Corzine said today he is "seriously" considering scaling back his plans to eliminate the property tax deduction on state income taxes next year.

Just a week after his budget speech, the governor backed away from his proposal to save $420 million by eliminating the deduction for all taxpayers but seniors and the disabled. Corzine said he is considering allowing households earning up to $150,000 a year to keep the deduction next year, but said no final decision has been made about the income threshold.

"I've heard enough angst about the deduction that I think it's worth a re-evaluation," Corzine told reporters after discussing the budget with a group of Eatontown residents. "We haven't concluded anything yet, but we're close."

Corzine told the residents that more than $200 million of what the state spends on the deduction is paid out to homeowners with incomes of $250,000 or more, and "it's a lot harder for somebody that's making $75,000 or $100,000 to get by."

"We'll have to structure something that recognizes the ability to pay," Corzine said.

State officials who have been briefed on Corzine's thinking said $150,000 is a likely cutoff for allowing the deduction, in part because residents earning between $75,000 and $150,000 would also lose their property tax rebates under the governor's $29.8 billion budget proposal. Republicans have branded that a "double whammy" on the middle class during the Democratic governor's re-election year.

You could see this coming a mile away. Corzine's proposals would have resulted in a substantial property tax hike, and now he's forced to scramble to find ways to restore much of the property tax relief that hasn't actually resulted in lower property taxes for anyone in the state (local property taxes continue rising - often above the 4% cap imposed by Corzine to stem the increases).

The question then becomes how exactly Corzine will pay for this, since he was hoping to "save" hundreds of millions of taxpayer dollars by eliminating the deduction and rebate.

Expect income taxes to increase further on those making over $500,000 - although that threshold might change.

It should come as no surprise that the state taxpayers were up in arms over his property tax proposals, since Corzine claimed that he would provide tax relief to homeowners and it never truly materialized. For all the talk about how property taxes would be brought under control, additional tax hikes with no added benefits (the increase of the sales tax to pay for the property tax relief) and the property tax increase cap have not solved the state's problems.

That's primarily because Corzine and state officials remain fixed on the revenue side of the ledger rather than looking at state spending, which remains out of control.