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McGreevey has been wary of making detailed promises.
Originally appeared in the Philadelphia Inquirer on 10/17/01
At a recent town-hall meeting at a retirement community in Ocean County, Democrat James E. McGreevey was asked so often about his plans to reduce property taxes -- particularly school taxes -- that he seemed exasperated by yet another question.
"I answered that already," he said before softening his tone by making light of the question. "If I haven't answered that by now, I'm in trouble."
McGreevey has spent five years railing about New Jersey's property taxes, focusing like a laser beam on the issue four years ago when he nearly upset then-Gov. Christie Whitman.
Yet, in this gubernatorial campaign, McGreevey seems to be struggling to make the case for how he would reduce property taxes. He has offered mostly modest plans or, in one case, has provided only sketchy details on a potentially sweeping proposal -- in large part because he is ahead in the polls and wants to avoid making costly commitments he would not be able to keep as governor.
When he talks about property-tax relief, McGreevey stresses three proposals:
He wants to expand the property-tax freeze for senior citizens to include about 110,000 more seniors. But that proposal has been usurped by the GOP-controlled legislature, which approved a nearly identical plan on Oct. 3. The bill -- which would raise the annual-income eligibility limits for singles to $37,174 and married couples to $45,582 -- is expected to be signed into law before the next governor takes office.
McGreevey proposes to make the state's two property-tax rebate programs, NJ Saver and Homestead Rebate, an income-tax credit, which would get money to taxpayers faster but would not provide additional property-tax relief. He also said he would limit NJ Saver to those earning $200,000 or less; the program now applies to all homeowners and provides an average of $600.
Perhaps McGreevey's most ambitious property-tax plan is a proposal still on the drafting board and modeled after New York's STAR program. But fundamental questions remain about how McGreevey's program would work, when it would take effect, and how expansive it might be.
Under the STAR program, New York pays part of a homeowner's school-tax bill. The state exempts a certain portion of a home's assessed value from the school-tax rate, and the state gives school districts money to make up the lost tax revenue.
It is similar in key aspects to NJ Saver -- which is also based on school-tax rates, except New Jersey residents pay the full tax bill and receive a rebate.
In an interview, McGreevey said that the state's sales-tax revenue had grown annually by an average of about $300 million in recent years, and that he would use that money for direct property-tax relief "based on the Pataki plan," referring to New York Gov. George Pataki, who started the STAR program. But New Jersey's economy has slumped, and the forecast has grown worse since the Sept. 11 terrorist attacks, raising questions about whether the state could afford to divert sales taxes for property-tax relief.
McGreevey would not say when his program would start or how much relief it would provide.
"Our focus has been . . . on what is achievable, what we definitely can do," McGreevey said. "Our plan is reasonable, measurable and achievable."
But what exactly is the plan?
McGreevey declined to discuss the details, deferring to his spokesman, Richard McGrath - who provided an unsigned, four-page policy document on the STAR program that showed how difficult it might be to implement a substantive plan similar to New York's.
"To pull off the STAR program, a governor would have to end the NJ Saver program and devote the NJ Saver funds to local taxing authorities" to make up the lost revenue to school districts, the unsigned document from the McGreevey campaign said.
McGrath said Monday that McGreevey had no plans to eliminate NJ Saver, dismissing the policy document as outdated. He also said McGreevey's program would be limited to "up to $300 million," far less expansive than the STAR or NJ Saver programs.
The memo illustrates how McGreevey's campaign has struggled with the issue of property taxes.
McGrath had said this month that the candidate would provide specifics on the STAR-like program. But as the Nov. 6 election nears and McGreevey remains comfortably ahead of Republican Bret D. Schundler in the polls, McGreevey's staff seems content not providing details that might limit their candidate should he become governor.
Ernest C. Reock Jr., a retired professor at Rutgers University in New Brunswick who has extensively studied and written about New Jersey's property taxes, said both gubernatorial candidates were "nibbling around the edges" of the issue.
"The big problem is you have to raise a lot of money if you want to do any more than that," Reock said. "Ideally, they should be talking about raising the money. Are they going to increase the sales tax? The income tax? They don't want to stick their necks out because they are still feeling the impact of the Florio situation, where he did raise taxes and got into deep trouble."
In 1990, then-Gov. Jim Florio raised state taxes $2.8 billion but lost reelection to Whitman in 1993.
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