Gov. Phil Murphy’s 2021 spending plan unveiled on Tuesday focused heavily on the state’s most contested topic—property taxes. In fact, his budget remarks include the phrase “property tax” 38 times.
“No other administration has done so much in its first two years to control property taxes, or to deliver more property tax relief,” said Murphy.
However, his predecessor, Republican Gov. Chris Christie, signed an annual 2 percent limit on any municipal property tax increases. And the late Brendan Bryne – governor from 1974 to 1982 – signed legislation creating the state income tax, constitutionally requiring any dollars raised to go toward property tax relief aid.
The budget calls for a host of programs all grouped under the umbrella “property tax relief,” which total $1.26 billion. They include $276 for the Homestead Benefit program, $40 million for the veteran’s property tax deduction, $7.8 million for the senior citizen and disable resident property tax deduction.
This year’s budget includes nearly $19.4 billion in state aid: $15.49 billion in school aid and $2.6 billion to local governments – dollar increases the administration argues are necessary to keep property taxes in check.
The camps of both Murphy and Senate President Stephen Sweeney, D-3rd District, are eyeing how to lower property taxes in the state, often considered some of the highest in the nation.
In August 2018, Sweeney put out a host of so-called “Path to Progress” proposals, which call for slashing school and state employee health and retirement plans. The proposals also call for increasing the frequency with which local governments use shared services – that is, merging public resources such as police departments, K-8 and K-6 school districts, parks and recreation, and road maintenance.
There were 859 such shared service agreements across the state in 2019, and 184 in 2020 so far, according to the Murphy administration.