The four joint legislative committees that have been studying ways to reduce New Jersey’s highest-in-the-nation property taxes released 98 specific recommendations for reform on November 15. The one receiving the most attention would reduce the property tax bill of a majority of homeowners by 20 percent in the first year. In total, the recommendations appear to have the potential to increase efficiencies and reduce costs. To keep members informed about how property tax reform will affect them, NJBIA has created a new Web page, Property Tax Facts.

From the beginning, NJBIA has pushed for reductions in local government spending and not simply shifting taxes onto the business community. Many of our recommendations have made it into the final committee reports. The Joint Legislative Committee on Constitutional Reform, for example, recommended maintaining the uniformity clause to the New Jersey State Constitution. The clause prevents local governments from taxing business property at a higher rate than residential property. NJBIA and its members worked very hard to preserve this clause.

The Joint Legislative Committee on Public Employee Benefits recommended increasing the retirement age for new public employees to 62 from 60, and early retirement to 60 from 55. It also called for repealing a 9 percent pension benefits increase enacted in 2001. The committee also recommended capping the salary on which a pension can be based at the Social Security contribution limit of $97,500 in 2007. NJBIA supports these recommendations.

On public employee health benefits, the benefits committee recommended that all active public employees and future retirees pay “some portion” of their health insurance premiums, but stopped short of recommending a specific figure. This implies that health benefit contributions should be achieved through tougher collective bargaining. NJBIA believes strongly that public employees must make a significant contribution to the cost of their health benefits for sustainable property tax reform.

The Joint Legislative Committee on Government Consolidation and Shared Services offered 18 recommendations, including the creation of an independent commission to “facilitate municipal mergers and shared services.” It called for financial incentives for districts that share services, as well as penalties for those that don’t. It also called for expanding the powers of the 21 county school superintendents to reduce administrative spending in school districts and creating a pilot program for the county administration of school districts. NJBIA supports these recommendations.

The Joint Committee on School Funding Reform recommended creating one new school funding formula based on students’ needs, not their residence. This would direct more aid to suburban school districts whose State aid has been held flat for the last five years. This mirrors NJBIA’s recommendations.

One recommendation the Association opposes is the elimination of the NJ Commission on Commerce, Economic Development and Tourism. The Commission’s main functions are helping businesses navigate the State government bureaucracy to obtain needed permits and financing, as well as attracting new businesses to New Jersey. It is not funded by property taxes, so it is hard to see how its elimination would help lower property taxes. For more information, contact Art Maurice at ext 247.

Twenty-Four-Hour Paid Family Leave Bill Clears Committee—Legislation that would require employers to provide 24-hours of paid family leave for employees with “special needs children” so they can attend school conferences, meetings and events was released by the Senate Labor Committee on November 13. The bill, S-1443 (Ciesla), would require employers with 50 or more employees to provide the leave in addition to any other paid leave (sick-time, vacation) employees already receive. The definition of a “special needs” child is so broad that virtually any child could qualify. Parents would be able to establish the special needs status themselves, without the confirmation of any licensed professional, and could cite such common problems as bad grades or tardiness to show a child has special needs. Furthermore, the leave could disrupt work operations for as many as 24 days, since the leave could be taken in one-hour intervals.

The State should not micromanage workplaces. Most employers have policies that accommodate employees’ family responsibilities. Legislators should not try to impose a one-size-fits-all government mandate on employers. Furthermore, New Jersey should do all it can to attract and retain businesses, not add new mandates that would discourage business expansion. The measure has been referred to the Senate Budget and Appropriations Committee. For more information, contact John Rogers at ext. 209.

Bill Extending Prevailing Wage to BEIP Grant Recipients Clears Labor Committee—The Senate Labor Committee on November 13 released legislation that would force any business receiving Business Employment Incentive Program (BEIP) grants to pay prevailing wages on its construction projects. NJBIA strongly opposes the bill, S-2247 (Sweeney), because it would vastly limit the attractiveness of the most effective job-creation program in the State.

Prevailing wages drive up the cost of construction projects by forcing contractors to pay union-scale wages even if they don’t employ union workers. Usually reserved for publicly funded projects, S-2247 would force any company that receives a BEIP grant to pay prevailing wages on privately funded construction projects, whether undertaken by the company itself, a landlord or developer. For many employers, paying prevailing wages would nullify any benefits received from BEIP grants. For more information, contact Art Maurice at ext. 247.

Legislative Leaders Oppose Tax Shifting as Property Tax Reform—Senate President Richard Codey and Assembly Speaker Joseph Roberts have said the property tax reform plan they are working on will not include shifting the tax burden to other local taxes, such as a local sales tax or income tax. In a November 6 Star Ledger article, the top two legislative leaders said they were focusing on a revised school funding formula, local government spending caps and government consolidation.