Jan. 30, 2007 - Most Homeowners Would Get Credit on Tax Bill

Property tax cut clears hurdle

As reported on NJ.com, yesterday the state Assembly approved the centerpiece of the proposed 20% property tax relief for homeowners. The measure caps municipal tax increases, school boards and other entiites at 4%.  The state Senate takes up the bill on February 5th.  As I told you on November 10th, the proposal is instead of rebates your tax relief would come as credits that would directly reduce property tax bills. A homeowner with the average state property tax bill of $5,867 would pay about $1,173 less.

Not all homeowners will see a 20% tax cut.  Only homeowners with incomes up to $100,000 will get it.  Those making up to $150,000 will receive a 15 percent credit and homeowners with incomes up to $250,000 will receive a 10 percent credit. Exemptions are permitted for local governments that includes debt service, health care cost obligations exceeding 4 percent, some pension contributions, the offsetting state aid reductions from a pevious year, uncollected taxes exceeding 4 percent and lease payments to county improvement authorities. School districts could also claim exemptions for debt service payments, health care costs over 4 percent, and adjustments for rising enrollment.

The measure, introduced late Friday, was the culmination of six months of special legislative sessions beginning in July aimed at easing the burden on homeowners who pay the highest property taxes in the nation, an annual average of $6,000. There were some Republicans who were angered by the short amount of time provided to review the proposal. The special session was made public through open meetings and live on the internet.

In addition, the state Assembly approved measures to create a state comptroller's office and  a commission to study town mergers.