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Archive for the ‘Property Taxes’ Category

In the mid-90’s there was an “independent film” ( I put that in quotation marks because this was around the time America was obsessed with movies that were well – you know, ‘independent’ ) called “Kicking and Screaming” about a bunch of college friends who graduate school, but can’t really let it go. So, instead of  moving back home and trying their luck in the real world, they return to school to attend freshman parties and live in a big house together off-campus. Anyway, you can imagine where this goes from here…a buncha over-educated and under-skilled dudes who make pithy comments and wry observations about college life when in fact, they are the losers who have failed to move on.

I feel like there is a bit of a stubborn reluctance amongst the Democrats to take up the tool kit. The Assembly has passed no bills, and while the Senate has passed one, they haven’t tackled any of the tough stuff even in committees. In fairness, the Senate Budget Committee has been holding hearings through the Summer. And Monday they passed new limits for public workers on unused sick time. But even the Senate Budge hasn’t taken on the sacred cows such as arbitration and civil service reform.

Chairman Paul Sarlo told reporters today that the “civil service opt-out provision is off the table.” Sarlo said Sweeney was the one who said that already, but I don’t recall him being so definitive. Anyway, the larger issue here appears to be in the Assembly.

Republican Assemblymen Vince Polistina and Domenick DiCicco issued statements criticizing the Democrats for convening committees Monday but failing yet again to take on the tool kit items. That prompted a sharply worded response from Dem Communications Director Tom Hester Jr.

The point here is that some of the tool kit will pass, and some will not. Democrats wouldn’t be Democrats if they passed all the bills as they currently are…But one might humbly suggest that they at least get to work figuring out what in those bills will work, and sifting out those ideas that won’t.

Speaker Oliver told us in an interview last month for NJN’s On The Record that she agrees the tool kit is just as important as the 2% cap. That is how the local communities will be able to comply with cap come January. So, let’s get to work.

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Ah, summertime. Beaches, Barbecue’s, cold beer and tool kit legislation.

And so it begins. The long budget debate that started in March has carried over into what I will officially call late July. It really is all part of the same conversation. And conspiracy theorists are convinced that Governor Christie has forced this march to continue in order to get people’s attention off the ultra-frugal budget which even it’s biggest supporters describe as “painful.” But the austere budget doesn’t work properly without a cap, and the cap cannot be reasonably enforced without enacting the major provisions of the tool kit. So it really does all go together, and it really is Christie’s entire economic agenda. All. At. Once.

But this process feels sooooo looooong, doesn’t it? It’s like that ridiculous song from the 1970’s “In-A-Gadda-Da-Vida.” It just goes on and on and on. Like the plot of that movie “Dune.” My goodness. Please,  just make it stop.

Maybe supporters of the toughest tool kit bills are hoping no one has the fight in them when it’s hot outside. And all the shiny, suited-up State House dwellers are thinking more about their upcoming two weeks at the shore than they are about how eliminating civil service will affect their cousin’s municipal job. Yeah, maybe this whole thing is by design. A plot to wear down the resistance and enforce an agenda the gleams with fiscal restraint, financial accountability and the end of living large off the public dime.

Let’s hope so. And let’s hope people don’t come back in the Fall and exclaim, “what have they done??!!” Let’s assume for now that while the changes are being made everyone’s head is firmly in the game. Because in the end, it’s harder to fix things after the fact then it is to get them right the first time.

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We hear an awful lot about why people are leaving New Jersey – taxes too high, cost of living is unaffordable, not enough private sector work. Lost in those valid arguments is a solid exploration of why people move here. That is the other side of the coin and it is an equally important discussion to be having.

People like their individual towns. They move here and stay here because they like that quaint hometown feeling. They like having their own town hall. They like their own police force, and they like that the schools are good. People enjoy the Penny-Lane romanticization of riding down main street with a fireman washing his truck, waving and calling your son by name. It’s not a fantasy. For some it is real life. But guess what? Those things cost money. The town hall requires maintenance and upkeep, the Police Chief probably makes $125,000 and those schools are “good” because they have nice grassy fields, smart committed teachers and a lunchroom that won’t make you gag.

So, when you start cutting money from those things people get nervous. They are not nervous yet, because right now there is this anti-property tax fever that has led to what some have argued is an arbitrary and perhaps hasty 2% cap.

The counter argument to supporting a cap above all other considerations is this: people might be even more inclined to leave the state if all those things that made it so appealing in their chosen town start to falter. Suddenly, that once cute town hall needs a coat of paint and looks shabby and rundown since the local Public Works Department laid off half it’s staff. That Police Chief is gone, along with a handful of those nice cops who you once played football with in High School. And finally, the school no longer holds a competitive advantage because young, qualified teachers don’t wanna relocate there…the pay is too low.

Another point to consider – we are living in a unique period of history. The economy really is as bad as it has been in several generations. But it will turn around. These things are cyclical. And if there is one thing we have learned about a crisis it’s that it doesn’t always lend itself to rational policy making. Particularly when the decisions that will greatly impact communities are made under duress over a holiday weekend.

I mean, look what happened with TARP. In 2008, the economy was in a full meltdown. Congress rushed in to pass the nearly $700 billion bank bailout. They attached no requirement that the banks then use that money to lend. And they put no stipulations on how it should be spent. I am not an economist so I don’t know whether that bailout was even necessary. My thought is that you let the guys who gambled with other people’s money go down. Nothing would have prevented a repeat performance more than letting the Capitanes of Industry go down with their respective ships. But regardless of what the right response was or should have been, it’s probably safe to say the legislation could have been a little less “we trust you’ll do the right thing” and a little more “this will guarantee you do the right thing.”

Finally, there is the Reform New Jersey Now element. This organization has been running ads urging action on the cap. Democrats have called on the Governor to disclose the donor list. Mike DuHaime, the Governor’s campaign strategist has said they will do so by the end of the year. The group’s tax status is such that they do not have to reveal that donor list. However, is it strange that this unknown group of people are driving the policy agenda in New Jersey? Not only driving it, but making sure lawmakers agree to a cap deal over July 4th weekend, and that it gets voted on within a week. Does that make good policy? Maybe. We’ll see.

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In the early 90’s classic “What About Bob?” Richard Dreyfuss ( this was before Kippendorf’s Tribe  ruined his career ) plays the straight man to Bill Murray’s fury-inducing bafoon. The movie is a series of situations in which Dreyfuss, playing the shrink, tries not to explode at Murray who keeps pushing the envelope. This includes Murray ( his patient ) arriving at Dreyfuss’ country home uninvited and unnannounced. We keep waiting for the explosion of anger, and every now and then it comes…although not always when we expect it.

What can I say about the handful of Democrats who are on the precipice of open revolt within the Democratic caucus. Governor Christie is running the table, and those who don’t want to go along with his game plan don’t have enough votes to override the South Jersey and the north Jersey Democratic coalitions. Chris Christie, George Norcross and Steve Audubato who works through Joe D are calling the shots. And according to a disgruntled few, they had better get all these reforms done soon because this united front cannot last forever.

After Steve Sweeney stood with Christie to announce a compromise on the property tax cap the Assembly Democrats held their own caucus Wednesday morning. A handful of people who feel Sheila Oliver should not go along with the compromise caused “quite a bit of unrest.” And it’s not one single issue – which only adds to the chaos. On the one hand, you have some women legislators who feel Oliver has not done enough to challenge Christie on the women’s health issue. I am told that when Valerie Vainieri Huttle complained about that and other issues in caucus Wednesday, Oliver said something along the lines of “while you were out shopping over July 4, I was here working.” Needless to say that did not go over well.

What’s more, Assemblyman Lou Greenwald ( who is south j, but seems to wanna buck the new world order a bit ) said he doesn’t think Democrats should keep reacting to what Christie says all the time. They should instead make the Governor respond to them. I’m told Greenwald, Pam Lampitt, John Wisniewski and others feel the Democrats need to bring their own agenda instead of trying to glom onto things like the cap by declaring it was their idea all along…then insisting they “got some major concessions” from the Governor.

Oliver said Wednesday that the Assembly would fix the mistakes of the 2.0 cap bill after it passes through subsequent legislation. John Burzichelli and John McKeon met with Kevin O’Dowd in the Governor’s office to find out what exactly they could change…but some felt it was a little bit like asking permission.

Moreover, there are some who feel the party needs to do more for their traditional allies – specifically the working class union guys. Those guys voted for Christie in the last election. And since then, Democrats have done nothing to try and woo them back. In fact, just the opposite has taken place. They have undermined labor’s agenda at every turn; when traditionally it was Dems who protected workers, it’s now that same party trying to undermine them with non-negotiated givebacks that do an end run around collective bargaining.

Hey look, times have changed. One could fairly make the argument that unions gotta get real and stop threatening strikes over unused sick time and Lincoln’s birthday ( full disclosure: I’m CWA local 1032 ). But on the flip side, perks – however petty they may sound – are bargaining chips in the larger chess game of negotiating multi-year deals. The unions at least want the Democrats to pretend to show them some love instead of jumping on the “my property taxes are high and it’s the unions’ fault!” bandwagon.

The Democratic party needs to think about – you know, the party. They gotta stand for someone. Unions vote. And as one Democrat observed “It’s easy to craft a mission when you are unified, it’s nearly impossible when you are not.” If the anger from these loose coalition groups that comprise the Democratic party starts to bubble over the surface, the party could lose it’s cool like Richard Dreyfuss and never outsmart the guy who is actually outsmarting them.

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When I was a kid and either dragging my feet because I wanted to put off going to bed, or avoid visiting someone I sorta hated…I was often told by parentals and the like  “let’s get this show on the road.”

It was an apt metaphor because big productions  ( like circuses and musicals ) sometimes travel, and in many cases I was literally putting on a show ( can you believe I was a slightly theatrical child who was also incredibly stubborn? Well, me neither! ).

Governor Christie is also taking the show on the road, in a matter of speaking. He was in Hoboken on Monday to sell the idea to taxpayers that a hard 2.5% cap will control the runaway growth in local government by keeping property taxes manageable.

It’s a show because it plays to his strengths. Christie is very good on his feet, and he relates well to the public. It’s also a show because in this case, the media was invited to watch but not to ask any questions.

Here are the numbers. Assuming the average property tax in New Jersey is $7200 per year. And the average tax went up 3.3%. That means that a hard 2.5% cap would only have resulted in $90 in savings for the average home last year. Not nothing of course, but certainly  ( as one Democratic lawmaker says ) not “the panacea” the hard cap has been made out to be.

When you couple the $90 in annual savings with a loss of a rebate check, it actually doesn’t do much to ease the burden households can expect next fiscal year.

The Christie Administration would argue that it is not a one-time fix…and that a hard cap will result in savings year after year by forcing local governments to live within their means.

Getting municipalities to trim their budgets and restrain their excessive growth??? Now THAT is a show worth watching. I might even DVR it.

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I was riding the train the other day and overheard a teenager explaining to her friend that her parents had decided to leave New Jersey because their property tax burden was too high. My eyes had sorta glazed over on this really boring book I was reading when that comment buzzed its way into my ear. I remember looking around to see if someone was saying it for my benefit, but realized of course they weren’t – I was witnessing one of those unvarnished real life moments.

Take away the politics of property taxes and you confront the reality: people cannot afford to pay what they are paying now let alone an increase ( I know this is hardly an original thing to say or write but bear with me ). And it is the fear of a property tax increase due to state cuts that is starting to rankle the Republicans who will need to stick by the Christie budget.

“There is a property tax pressure right now, no question about it,” said one Republican lawmaker. And the Administration “doesn’t want to talk about it.” The whole Christie approach is to curb outta control spending at the local level by forcing “structural reform.” In other words, pain now = gain later. And the Governor seems confident that the public understands that and is with him on this ( I know, polls say otherwise, but remember “the only poll that matters is on election day” ). Perhaps the voters do agree with Christie that the only way to mortally wound that pesky property tax beast is to force cuts in spending at the local level by starving it. Well, that is certainly better than status quo, but when I hear terms like “structural reform” I can’t help but think that’s not really what this is. Structural reform means radically overhauling the system. It would be like Paul Volcker’s much maligned suggestion that America abandon the ( ridiculously complicated ) current tax system in favor of the VAT.

But I hear there are additional reforms making their way down the pipeline which could certainly be characterized as “real reform” if not reform of the “structural” variety. For example, capping all local labor costs ( which gets tricky with police but is certainly doable ). Look for that legislation to be tied to some kind of arbitration reform and you may get another set of bills that neither side can say “no” to…kinda like that pension package. Anyway, it may not exactly kill the beast, but it will certainly show that bitch who’s boss.

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By now it is no secret that Democrats may be on a collision course with Governor Christie over the so-called millionaire’s tax ( which is a bit of a misnomer because it actually kicks in at 400k, and those folks are hardly “millionaire’s” ). In fact, Repubs maintain that people above 400 already pay 41% of the taxes. And last year with that additional tax it was 43% ). So the question now is how does everybody find a way to save face and avoid what some believe to be a high stakes game of chicken.

As Republican Joe Malone pointed out during budget hearings this week, there is currently no bill to renew that top earner surcharge. Democrats seem to take Christie at his word that he will veto such a bill. So maybe the Democrats will send it to him and force his hand?Then both sides can fight it out and see who the public sides with.

One Republican lawmaker tells me “the budget may not get done before June 30.” Does that mean shutdown? One Democrat says it’s unlikely to happen, but if there is no budget, there is no government. It’s like the sign on the wall at the food court in Fast Times at Ridgemont High – “no shirt, no shoes, no dice.”

So, there is a proposal that Republicans may float to keep the state afloat…so to speak. Swap out $600 million in pre-k funds for school aid. It would basically eliminate the pre-k program which Christie said during the campaign “we simply cannot afford.” But Democrats hold it dear. they say studies show it’s effectiveness in getting kids acclimated to learning. And of course even the elimination of pre-k wouldn’t get us all the way toward making up the $820 million in school cuts. But, it would be a partial restoration. And with some districts forgoing pay raises ( who would later need to be rewarded ) you might come close. It would certainly avoid an awkward confrontation over the millionaire’s tax. And Dems may not wanna go down that road. If the government gets shutdown over higher taxes for the rich, Christie will be the darling of the national media. He might even grace the cover of Newsweek as the man who “stands up for Conservative principles.”

Bottom line is this: Republicans are making the transition from talking about what bad shape the state is in fiscally ( because of Democrats over the last 8 years ) into governing and “it hasn’t gone smoothly.” Moreover, now Republicans are starting to hear it on the local level as the threat of property tax increases looms, and little jonny’s lacrosse team will be no more. You have three new leaders with the Speaker, Governor and Senate Prez…perhaps they will find a way for everyone to chalk up a victory and leave for vacation on july 1.

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