I am writing in response to the suggestion contained in the July 24th letter to the editor entitled, “Commercial property a double-edged sword.” in which the writer argues that Montvale should not receive enhanced, temporary state aid when it loses major commercial tax ratable. He says such action would set a bad precedent.

What the writer may not know is that the state has been paying out millions in transitional aid to cities and towns for many years and that money comes from suburban taxpayers such as those in Bergen County.

To cite some examples, over the past three years Asbury Park has received $9.2 million in state transition aid, Harrison has received $5.85 million, Camden, $44.5 million; Paterson, $63.5 million; and Trenton has been granted $73 million of state taxpayer money. 

On top of these hefty transition grants, each of the named municipalities received tens of millions of dollars in additional municipal aid, and in many cases hundreds of millions in education aid – again paid by state taxpayers.  Over the past two years taxpayers in Asbury Park haves benefitted from more than $110 million in state education aid, Camden residents got $555 million in state school aid and Paterson received $453 million in basic education aid. Montvale over that time got less than $1 million in state school aid.

In every one of the municipalities receiving large amount of transitional, education and municipal aid the average property tax bill is thousands of dollars lower than Montvale’s average of $11,181. The average tax bill in Asbury Park for example is $4,642.

When a large company leaves a town, the sudden loss of property tax revenue to a municipality can be devastating on the local budget.  Montvale is expected to lose $750,000 in property tax revenue as a result of Barr Labs leaving and the property going off of the tax rolls due to its purchase by the tax exempt Memorial Sloan Kettering.  Upper Saddle River is facing a similar potential revenue loss from the closing of Pearson Education, as is Park Ridge with the loss of Hertz and Sony.  Yet, these towns are not allowed to apply to the State for Transitional Aid to soften the blow; they must either raise taxes or cut services.

My Assembly bill A-4402 will protect all local property taxpayers from sudden tax hits due to economic losses.  The aid applies only when a town is facing a ratable loss in excess of 10 percent of the town’s total municipal tax levy or the loss of the largest assessed valuation of taxable property in the municipality.  And, the aid won’t continue in perpetuity.  By definition, it is transitional, short-term financial assistance to help towns adjusting to a sudden loss in revenue. 

My legislation is also a vehicle to provide tax relief and tax fairness to suburban residents who  are  getting squeezed from both sides: they are constantly shelling out tax money to prop up other communities and getting virtually nothing back from the state in the form of either municipal or school aid.

For the sake of our economic future, we must find a way make New Jersey attractive to business and affordable for suburban homeowners. My legislation is just the first step to bring relief to middle class taxpayers.

 

Holly Schepisi

Assemblywoman ~ District 39