During a June 21 press conference at the State House in Trenton, the state’s top Democratic leaders – Gov. Phil Murphy, Assembly Speaker Craig Coughlin, D-19th District, and Senate President Nick Scutari, D-22nd District – confirmed reports from earlier in the week, announcing an agreement on the senior property tax cut plan known as StayNJ.

“We’re proud to announce that we have reached a fiscally responsible agreement to provide historic property tax relief to our seniors,” said Murphy. “As I’ve said from the start, and I think we all have said, we are working to build a stronger and fairer New Jersey that is affordable for all of our hardworking families. The Speaker and Senate President have been critical at every step in those efforts. And we would not be here today if it were not for their partnership and good faith. Our work together continues to show how New Jersey can deliver for our residents and act like the adults in the room when it comes to how our institutions and government should function.”

As NJBIZ outlined, StayNJ will be phased in over the next few years, and initially through the current ANCHOR program, with full implementation by January 2026. Some of the program specifics include:

• Residents age 65 and older will get a 50% property tax credit with a $6,500 cap – down the $10,000 initially proposed, which will be indexed based on property tax increases – with an income threshold of $500,000 a year (the original plan had no income threshold).
• Immediate property tax relief under the ANCHOR program with senior homeowners and renters getting a $250 per year boost.
• Certain funding commitments to fulfill a full pension payment, record aid for K-12 education, a robust surplus, and the $250 income tax deduction for property taxes paid by veterans, senior citizens, and disabled individuals.
• The establishment of a six-member commission to offer recommendations by May 2024 on how to best implement StayNJ through a singular program and application.

The total cost of StayNJ is projected at around $1.3 billion when fully implemented, with the first direct credit on property tax bills expected to be delivered in the first quarter of 2026. The plan would include a “lock box” to set aside nearly half of the money needed to fund the program by 2026, with allocations of $100 million in year one, $200 million in year two, and $300 million in year three.

The cost for boosting aid through the ANCHOR program this year is expected to be an additional $140 million.

“No one should have to choose between retiring in the place they’ve long called home and their ability to afford to age here,” said Murphy. “This compromise agreement prioritizes equity and affordability to decisively level the playing field for New Jersey seniors.”

“StayNJ is about our future and our families’ future,” said Coughlin, who noted that the program would cut property taxes for 97% of New Jersey senior homeowners. “StayNJ will finally give New Jerseyans the freedom to choose whether or not to stay in New Jersey in their communities and with their families when they reach retirement age.”

Scutari describes it as a gamechanger for New Jersey’s seniors who are getting squeezed by escalating expenses.

“It will provide significant tax relief that will make the state a more affordable place in which to live, work and retire,” the senate president explained. “Reducing the burden of property taxes will give senior citizens the financial security they need to remain in New Jersey, where they built their lives. We want to offer seniors and their families the ability to plan their future here in New Jersey.”

A ‘historic investment’

Murphy acknowledged that this plan will be challenging and complex to implement, pointing to the importance of the commission for recommendations as it ramps up. And while negotiations between the Democratic leaders were spirited – and even spilled publicly, at times – the governor said that this plan now marks $6 billion in direct relief committed over the last two years to tackle one of the state’s longest-standing affordability challenges: property taxes.

“I cannot stress this enough. This is a historic investment,” said Murphy. “We have provided more property tax relief than any governor and Legislature in our state’s history. And that is because of our commitment to making New Jersey more affordable.”

Murphy reiterated what he stressed while the negotiations played out: That while he was open to providing a boost for seniors, it had to be done in a responsible way to avoid another chapter in Trenton’s sordid history of fiscal irresponsibility. And that it had to be done in a way to maintain the budget commitments noted above.

“And today’s agreement continues to build on that track record and our commitment to fiscal responsibility that we have made since day one of our administration,” said Murphy.

“We’ve made prudent investments and eased the burden on property tax owners while maintaining a healthy budget surplus,” said Coughlin. “We’re committed to continuing to do that. We worked together and made fiscal responsibility a hallmark of this era. Those decisions have afforded us the opportunity to undertake a project like we are today, a program that will fairly invest in the future of New Jersey. It builds a framework of support for our families, strengthens our communities, and fortifies our economy. There’s a lot to be excited about.”

Scutari credited Murphy and Coughlin for their partnership in getting this plan together.

“And that wasn’t necessarily thought to be an easy task. But when you have the trust and the relationships that we’ve had over the years, it really wasn’t that hard,” said Scutari. “We knew where we wanted to be. We just needed to get there. And these numbers reflect fiscal responsibility as well as a game-changing property tax plan for senior citizens and maintaining the property tax relief that we’re giving to all property tax owners in New Jersey.”

“At the end of the day, it was a collaborative effort,” said Murphy. “And we’re doing it in a way that is fiscally responsible.”

AARP New Jersey applauded the agreement.

“We commend New Jersey’s leaders for reaching a compromise, which includes an income eligibility cap for the StayNJ program and increased relief for renters to help make NJ more affordable for those older residents who are struggling with our state’s high property taxes,” said Evelyn Liebman, AARP New Jersey director of advocacy, in a statement. “The framework of the deal will provide the kind of bold and transformational relief that so many New Jerseyans – who are also struggling to afford rising prices on everything from groceries to gas along with the highest prescription drug prices in the world – need to stay in New Jersey. We look forward to seeing the details of the agreement soon, and we stand ready to work with our elected leaders to move this program forward.”

The waiting game

Republicans, meanwhile, derided the plan as an election-year ploy, questioning whether it helps seniors who are struggling the most and why it does not take full effect for several years.

“Trenton Democrats are trying to buy votes this year with the promise they’ll deliver StayNJ property tax relief starting in 2026,” said Sen. Joseph Pennacchio, R-26th District. “If StayNJ is really affordable and sustainable and something New Jerseyans should expect to provide relief for years to come, why make them wait three years to get a first payment?”

“StayNJ is the Democrats’ election-year ploy. It does nothing to erase their two decades of bad policy decisions that drove up costs and put us in this expensive mess,” said Assembly Republican Leader John DiMaio, R-23rd District, who added that it would not solve the state’s cost-of-living crisis because it omits the state’s school funding obligations.

“The Democrats’ StayNJ plan allows the wealthiest seniors to receive the maximum benefit, but seniors most at risk for property tax increases have to settle for less, because it still doesn’t include a school funding solution like the Republican property tax cut proposal,” said DiMaio. “School taxes are the biggest driver of property taxes. Failing to include school funding in the package means StayNJ won’t ever deliver sustainable, long-lasting property tax relief.”

“Republicans believe New Jerseyans deserve property tax relief today, not three years from now,” Pennacchio added. “Unlike what Democrats have proposed with StayNJ, there’s no opportunity for a bait-and-switch with our ‘Give It Back’ plan. Since the money is in the bank right now, we believe we should provide property tax relief right now.”

Despite those objections, StayNJ is being fast-tracked in Trenton as the deadline to reach a state budget agreement by June 30 rapidly approaches.

And while it remains to be seen whether the legislation will get any bipartisan votes, the Democratic leaders hinted at broad support during Wednesday’s press conference.

“I’m very happy with the result. I can’t wait to get it voted out,” said Scutari. “It feels like there’s universal support already. And that’s across the aisle for Democrats and Republicans, because we’re all talking about the same message. We want to make New Jersey more affordable for all folks that live here.”

“I think this is going to be wildly popular. And no matter what party you’re in, no matter what your persuasion, it’s going to be a hard thing to turn your back on,” said Murphy. “This has got a lot of support, not surprisingly, including across the aisle.”