PACKET EDITORIAL, March 12
By: Packet Editorial
It’s tax season again in more ways than one.
With little more than a month to go before federal income tax returns are due, many taxpayers are still poring over their W-2’s, 1099’s and assorted documentation of itemized deductions to submit to the Internal Revenue Service keeping their fingers crossed that, when they get to the bottom line, the balance will be coming back to them rather than going into the U.S. Treasury.
At the same time, a lot of New Jersey residents are getting their state income tax returns together, hopeful that whatever Washington is doling out these days in the form of President Bush’s tax cuts, Trenton will not be taking away to balance Gov. McGreevey’s budget.
If uncertainty hangs over the heads of these state and federal income taxpayers, there is no such uncertainty regarding the property taxes they’re going to be paying in the coming year. With the single exception of Montgomery Township, where property owners may actually see a slight decrease in their municipal tax rate, every municipality and school district in the greater Princeton area is looking at substantial increases in the property taxes needed to support their proposed budgets. And in most cases, they are doing so just to maintain current levels of service, not to add any frills or provide any new programs for residents and schoolchildren.
Princeton Borough’s initial round of budget discussions has produced a preliminary spending plan of $22.1 million, which would require a 20-cent increase in the municipal tax rate. To support this budget, the municipal tax bill for the owner of an average borough home would rise nearly $700, from $2,482 to $3,176.
Meanwhile, Princeton Township’s preliminary budget of $30.2 million calls for a tax-rate increase of 5 cents, which would cost the owner of an average home $208 more. West Windsor’s preliminary $27.9 million budget would require a 4-cent increase a $96 hike for the owner of an average home. Even Plainsboro, which has long boasted the lowest municipal tax rate in Middlesex County, was looking at a 3-cent increase to fund its proposed $17.1 million budget, costing the owner of an average home an additional $57 that is, until the school tax rates were announced.
It turns out these municipal budgets and tax rates tell only a small part of the story. Add in the school budgets, and their corresponding tax rates, and now you’re talking big bucks. The proposed Princeton Regional Schools’ budget of $62.1 million would add another 10 cents to the borough’s tax rate and 7 cents to the township’s. West Windsor-Plainsboro’s proposed $129.8 million budget would actually cut 2 cents off the tax rate in West Windsor but add a whopping 29 cents in Plainsboro. (In fact, Plainsboro trimmed its municipal budget to the bone this week after learning what the school tax rate would be.) And in Montgomery, school officials project their proposed $58.7 million budget would add an estimated $700 to the tax bill of the average homeowner, more than offsetting any savings derived from the lower municipal tax rate.
Now add the damage from the Mercer County budget 8 cents more in borough, 4 cents in the township and 2 cents in West Windsor. Every property taxpayer in the region is going to be hit hard, but the pain will be especially severe in Princeton Borough, where a 38-cent increase in the combined municipal-school-county tax rate translates into a property-tax hike of $1,311 for the average homeowner. Even if the Borough Council can whittle down the municipal rate by a few pennies, borough residents are still looking at an unconscionably large increase in the most regressive tax they are compelled to pay.
Has the case for meaningful property-tax relief ever been stronger? We doubt it. Will any of this sink in with the McGreevey administration and legislative leaders? Not unless municipal and school officials, together with overburdened property taxpayers, step forward and demand action. New Jersey has long needed fundamental tax reform; never in our memory have the numbers made this need any plainer than they do today.