Township Officials Say Toolkit Needed to Make Tax Cap Work

Gov. Chris Christie signed the 2 percent property tax into law on Tuesday, but local officials think state lawmakers need to get the toolkit approved for it to have a chance to work.

Christie signed the compromise bill into law after he originally proposed a constitutional amendment to cap property tax increases at 2.5 percent. The measure cuts the number of exceptions allowed from the cap, but the exceptions remain include employee pension payments, health care, debt service and emergencies.

But state lawmakers have yet to approve a package of bills Christie has dubbed a "toolkit" for local officials to control costs. Mayor Thomas McDermott said it's important for those tools to be approved in order to make everything work properly.

Without the tools and another source of revenue, it could mean cuts in service across the state, Township Administrator Tim Gordon said. "I'm not sure when, but at some point people would see a reduction in services," he said.

Both McDermott and Gordon said capping arbitrators awards on union contract increases is the key item of Christie's "toolkit" that should be approved by state officials. "The cap on arbitrators awards is very important," McDermott said. "(Uncapped award increases is) what can kill us."

Gordon said municipal government is labor-intensive. It means services cannot be automated and people need to perform those jobs like police, fire, trash collection and others.

"If we have the cap (on arbitrators awards), it will help," he said. "If they don't pass it and we have the 2 percent cap (on property tax increases) there will be more chaos."

If arbitrators and unions don't worry about the increases, he said, it means cuts in services in hte future. That could mean layoffs.

McDermott said the township's budget has little discretionary funding. Most of it is tied up in salaries and benefits. Without a cap on arbitrators' awards, it could make completing a budget more difficult. Officials already start in the negative, and it would only make it worse, he said.

But both McDermott and Gordon both said the township needs another source of revenue, which would shift some of the burden from property taxes. Plus state officials should not cut state aid. "We need a mixture of revenues," Gordon said.

He suggests a local sales tax, which would be helpful to Millburn because of the Mall at Short Hills. He also said there should be some sort of tax or fee on liquor whether it's a tax on buying a drink in a restaurant or a fee on renewing a license.