Tax cap needs time, according to Grifa, but towns getting better already

TRENTON – Department of Community Affairs Commissioner Lori Grifa told the Senate Budget and Appropriations Committee Wednesday that the 2 percent cap on local tax levies is having the intended effect of beginning tax reduction.

But the associated pain that many towns are experiencing as a result of the cap and tighter waiver could be somewhat avoided, she said, if the Legislature would finally finish passing toolkit bills, she said.

She urged the body to reconsider the remaining toolkit bills, like capping sick leave, in order for towns to find a comfort zone under the new cap.

“Mayors confirm this to us every day,” she said.

She said municipalities found efficiencies through DCA’s “best practices” program last year, and the department saw an increase in shared services in recent budget reviews.

But shared services could be a larger part of the tax reforms, as supporters like Essex County Executive Joe DiVincenzo attest, she said, if civil service reform, another toolkit initiative, was made law.

“We cannot have shared services and consolidation discussions without considering civil service,” Grifa said. “It ties the municipality’s hands…Nearly one-third (of towns across the state – those who employ the practice –) are left out of the shared services discussion.”

Of the more than 500 municipalities across the state, she said 48 filed for a municipal tax decrease last year. Another 114 managed to keep tax increases to 2 percent or less.

Of the 30 towns that filed to have voters decide at the polls whether they can exceed the cap, only in 14 towns did that referendum land on the ballot.

She said contrary to some opinions, the cap “has not resulted in an automatic and across-the-board tax hike.” Tax cap needs time, according to Grifa, but towns getting better already