In a potential 2017 precursor to a general election for governor, a Republican lawmaker aimed today to unhorse the hard-charging Democratic Mayor from Hudson County.
On the heels of an attack earlier this year by an Assembly colleague and doing his own part to muddy Jersey City Mayor Steven Fulop, Assemblyman Jack Ciattarelli (R-16), said Jersey City losing $80 million in property taxes due to tax abatements exemplifies a broken school funding system.
The assemblyman from Hillsborough noted that Jersey City’s abatements or payments-in-lieu-of-taxes (PILOT) are long-term tax breaks given to developers, allowing them to pay a fixed amount instead of the normal property tax rate. The city shares five percent of the PILOT revenue with the county. Most times, the school district receives very little or nothing.
“This report reveals the tip of an iceberg that is vast and mostly underwater,” said Ciattarelli, who is in GOP conversations as a possible 2017 candidate for governor. “Short-term property tax abatements, under very special circumstances, may have their place. What’s happening in Jersey City and elsewhere is crony capitalism at its worst and an injustice to all New Jersey taxpayers.
“Jersey City can afford to siphon property tax revenues from their schools because the state provides such large subsidies,” he added. “In Jersey City, the state contributes 60 percent of its school funding. This subsidy is so overly generous that local taxpayers pay only 15 cents on the dollar for their schools.”
Fulop’s own statewide designs are well-documented by this website.
“At a time when the state is experiencing a painful squeeze on its budget and can’t afford to make the full teachers’ pension payment, the abatements exploit the state school funding formula,” Ciattarelli said. “If communities want to provide tax abatements to encourage development, they should fund them from municipal and county taxes, not school property taxes.”
Following up on a face to face case he made to teachers last month, the Republican Assemblyman laid out two parts of his comprehensive proposal for pension reform that address the area of school funding and abatements:
- No community is allowed to fund less than 25 percent of their school budget through the local tax levy (some communities fund less than 15 percent of their school budget, while others fund more than 90 percent); and
- No community whose local school budget is funded more than 50 percent by federal and state aid can abate school property taxes on new development.