Local governments would be able to lower their costs and save property taxpayers money under several bills under consideration in the Senate Budget and Appropriations Committee. The committee held a hearing August 16 on several bills that are part of Governor Chris Christie's proposed tool kit to lower costs for local governments so they can better operate under the newly imposed 2 percent cap on property tax increases.
A key bill, S-2220 (Sarlo), would cap the amount of pay existing public employees can collect for unused sick leave and vacation time when they retire. Often, employees at many public entities have been allowed to accumulate unlimited amounts of sick leave and receive payment for all of it when they retire. As a result, some retirees have collected hundreds of thousands of dollars from public entities in addition to their already generous pension and health benefits. Earlier this year, Christie and the Legislature enacted a law to cap sick leave and vacation pay for new public employees, but not existing public employees.
Abuse of sick leave policies has contributed to New Jersey's highest-in-the-nation property taxes by forcing school boards, municipalities and other local government entities to payout huge lump sums when employees retire.
The committee also took testimony on S-2024 (Kyrillos), which would make it easier for municipalities to share services by permitting them to bypass certain onerous Civil Service requirements that make consolidating the workforce very difficult. Also, the committee released S-2100 (Sweeney), which would prohibit employees from the NJ Association of Counties, the NJ League of Municipalities and the NJ School Boards Association from participating in the State's pension and health benefits programs.
The measures are part of a broad package of proposals designed to help local governments control costs that contribute to high property taxes. Christie has called the package a "tool kit" because it would give local governments the tools to control local spending.
For more information, contact Jaime Reichardt.
2. Obama Signs Manufacturing Enhancement Act Cutting Tariffs on Raw Materials
Manufacturers who rely on raw materials from overseas could be getting a price break under a new federal law signed by President Barack Obama on August 11. The Manufacturing Enhancement Act of 2010 lowers or eliminates tariffs on a wide array of raw materials through December 31, 2012.
According to the to the National Association of Manufacturers, the bill will increase production by $4.6 billion and support almost 90,000 jobs by lowering manufacturers' costs for raw materials.
3. NJBIA Opposes Bills That Authorize Rain Tax on Ocean County Businesses
Ocean County businesses could be forced to pay an undefined amount in fees to pay for stormwater runoff projects under two bills that were released from a joint Senate and Assembly environment committee. NJBIA opposes S-1856 (Smith)/A-2606 (McKeon) and S-1815 (Smith)/A-2577 (McKeon) because they would amount to another tax on businesses, many of which already pay a lot of money to address stormwater runoff.
S-1815 would permit Ocean County and/or municipalities within Ocean County to establish stormwater utility authorities that would be allowed to impose fees on property owners. S-1856 would authorize Ocean County to develop a stormwater runoff and non-point source pollution plan, including fees to be assessed on any new development in the area.
Testifying August 12 before a joint panel of the Assembly Environment and Solid Waste Committee and the Senate Environment and Energy Committee, NJBIA Vice President David Brogan said the bills amount to triple taxation because businesses would pay property taxes, existing stormwater permit fees plus the new fee included in the bill. Many facilities are already required to obtain stormwater permits and mitigate any impacts to stormwater, which can cost thousands of dollars. This would simply add insult to injury.
NJBIA also has concerns with the way the fees would be determined. The NJ Department of Environmental Protection (DEP) would be responsible for developing a formula that could be used as guidance by the county, but would not have to accept any public input or go through the Administrative Procedures Act. The fees would be based on the amount of impervious surfaces, such as parking lots and drive ways, and the cost associated with mitigating the impact of stormwater on water bodies. In short, Brogan said, "you are taxing the rain that falls on each property." Even with the DEP guidance, the county would not be restricted by the formula developed by the department. In essence, the county could charge whatever they want.
For more information, contact David Brogan.
