reform – Page 8 – Hank Kalet

Delay levy cap indefinitely

Gov. Jon Corzine has signed several of the Legislature’s tax reform proposals (if you want to call them that), but he’s yet to sign what Trenton has pegged as the most important of the measures — the bill that would create the 20 percent tax credits and impose a 4 percent levy cap on municipalities, schools and county governments.

The governor ostensibily is holding out for a ban on dual-office holding in New Jersey, but he should take the time to rethink the proposed levy cap and push the Legislature to find more efficient and effective ways to hold local spending down.

Spending an afternoon talking about the budget with South Brunswick school officials puts the levy cap in perspective. The cap, as Superintendent Gary McCartney points out, applies to the total amount to be raised by taxes — regardless of whether the tax base grows (new houses, new warehouss, etc), and regardless of whether enrollment grows or an unexpected major expense (roof repair, for instance) is needed.

About 80 percent of the budget is personnel costs — either salary or health and retirement benefits. The rest is a mix of facilities and supplies, including heat, electric and other utilities costs.

For the most part, the district has done a solid job in recent years of keeping spending increases to a minimum, adding staff only to keep teacher-student ratiosstatic, to man new buildings or to provide newly mandated programs.

But education is expensive — the average house with two children in school might generate $5,000 to $10,000 in school taxes but costs the district more than $20,000, a net loss. That means rising school taxes.

The new cap law attempts to control spending by attacking the sympton (rising taxes), without addressing its causes (among them single-source funding and not enough state financing, too many school districts) — setting limits without giving school districts, in particular, real tools to stay within the limits without slashing instructional programs.

It’s a prescription with the potential for way too many dangerous and debilitating side-effects. It needs to be changed.

South Brunswick Post , The Cranbury Press
The Blog of South Brunswick
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Cut down the trees

In New Jersey, under both political parties, Christmas has traditionally occurred in July.

And while there is talk in Trenton about ending the practice, comments by Democratic State Party Chairman Joe Cryan, an Assemblyman from Union County, make it clear that ending it will be difficult at best.

As questions swirl around hundreds of millions of dollars lawmakers added to the state budget last year, the head of the Democratic State Committee defended the grants Tuesday by calling attention to the role state aid plays in supporting causes such as cancer research, autism services and children with disabilities.

Assemblyman Joseph Cryan, D—Union, pointed to the more than 70 organizations signed up to testify during a day-long budget hearing as evidence of the state’s needs. Many of those needs, he argued, are served by grants.

“Media accounts tend to focus on the very limited, narrow scope of the negatives as opposed to the very broad brush of the positives for the people of New Jersey,” said Cryan, who sits on the Assembly Budget Committee and heads the state Democratic Party.

But as The Asbury Park Press writes, the issue is not the usefulness or necessity of the specific programs, but a process that is conducted under cover night and that legislators may use to woo local voters:

Some of them were worthy. But the process for doling them out is anything but.

The grants last year — as in the past — were handed out at the 11th hour with no public scrutiny. Most of them went to Democratic districts — often to benefit legislators’ friends, relatives, employers or pet causes.

And it costs the state loads of money and, like so much of what happens around New Jersey, erodes trust in government. The practice has to end.

South Brunswick Post , The Cranbury Press
The Blog of South Brunswick
The Cranbury Press Blog

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A dangerous infectionon the body politic

A very good investigative report in The Star-Ledger today asks the question: “Did ‘800-lb. gorillas’ sit on property tax reform?”

The story details the money spent by a variety of special interests to point the tax reform effort in directions that would benefit them, or at least not hurt them much.

Lobbying reports released yesterday show groups with the biggest stake in
property tax reform spent more than $1.9 million last year to influence lawmakers. At the same time, key legislators extracted nearly $569,000 in campaign contributions from the same groups.

Labor unions, the New Jersey Business and Industry Association, engineering firms — all tossed in quite a bit of change to stymie the reform efforts.

Which underscores an important reality. Real reform is unlikely unless we can reform the campaign finance system. The proposed clean elections pilot — a rather weak extension of 200’s badly flawed pilot — is not enough. A much more extensive pilot — covering at least six districts and including the primaries and third parties, as proposed by the clean elections committee — needs to be tried, with a promise of a full-legislative program being put in place by the next Assembly election.

Without it, all budgetary and tax reform efforts — along with needed consumer, environmental and labor reform legislation — will be hijacked by money.

Don’t believe me? Ask Matt Shapiro, an unpaid lobbyist for New Jersey’s 1 million tenants who was quoted in the Ledger story:

“Had we been a group that made large campaign contributions, we would have had more access,” Shapiro said. “We’ve had conversations, but we were not legitimately a part of that process.”

Any questions?

South Brunswick Post, The Cranbury Press
The Blog of South Brunswick
The Cranbury Press Blog

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The mirage of reform

The Star-Ledger today offers a summary of the state’s tax reform effort that presents the last half year in a somewhat better light than I would.

Of the 98 recommendations made by four special joint committees, the paper says that about half were enacted as law. And while that maybe true from a technical standpoint, the most important were not and many of the other controversial items were either watered down in committee or between the release of the reports and the passage of the legislation.

Take the consolidation bill. The one that became law essentially created an advisory panel with authority to study the issue, but left the final decision to voters in the communities to be merged. Normally, I would never oppose giving voters a choice, but the history of municipal and school consolidation is one of failure and inaction, caused only partly by fiscal considerations. Other tangential issues — red herrings like the amorphous “identity,” as if villages like Kingston that are not independent municipalities lack identity — have come into play keeping the expensive array of overlapping and repetitive governments in place.

The bill originally on the table would have addressed that by giving the state Legislature and governor final say — the merger panel would recommend towns to consolidate and the state would act. That would have been infinitely better.

Go down the list: The ban on dual-office holding? Still waiting. New school aid formula? Wait until next year. State comptroller? Sort of — a far weaker comptroller was created than proposed.

The Legislature did manage to create a new, executive county superintendent — a silly idea that creates a new level of bureaucracy — and impose a set of tax levy caps destined to do little more than hamstring local governments and schools. Our best hope for the caps is that they create momentum for greater shared services and mergers — if you can’t spend, after all, you have to find other ways of providing services.

How would I grade the governor and Legislature at this point? I’d give them an incomplete — and make no mistake, this grade applies equally to Democrats and Republicans.

South Brunswick Post, The Cranbury Press
The Blog of South Brunswick
The Cranbury Press Blog

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