New Jersey Assembly Bill A2615

New Jersey 2024-2025 Regular Session

• Introduced: 1/9/24
• Refer: 1/9/24

Caption

Increases distribution to municipalities from Energy Tax Receipts Property Tax Relief Fund over five years to restore municipal aid reductions; requires additional aid to be subtracted from municipal property tax levy.

Impact

If passed, the bill would implement systematic annual increases in funding to municipalities, starting with a 20% increase in FY 2017. This will progressively increase to a full restoration by FY 2021, thereby enhancing the financial stability of local governments and directly impacting their capacity to deliver services. Importantly, this legislation also requires municipalities to deduct any increased ETR aid from their property tax levies in subsequent fiscal years, which could alleviate financial burdens on local taxpayers.

Summary

A2615, also known as the Municipal Aid Restoration Bill, proposes to increase the distribution of state aid to municipalities from the Energy Tax Receipts Property Tax Relief Fund. The bill aims to restore cuts made to municipal funding during financial constraints experienced in the fiscal years 2009 to 2011, which resulted in reduced aid for many municipalities. The proposed restoration will span over a five-year period, amounting to approximately $331 million intended to recuperate losses in both Consolidated Municipal Property Tax Relief Aid (CMPTRA) and Energy Tax Receipts Property Tax Relief Aid (ETR Aid).

Contention

Notable points of contention surrounding A2615 may arise from debates over local funding and control. While supporters argue that restoring these municipal aids supports essential local services and reduces the tax burden on constituents, critics may raise concerns regarding the state’s ability to maintain sustained funding amidst fiscal pressures. Additionally, the stipulation for municipalities to lower their property tax levies by the amount of aid they receive can lead to discussions about taxpayer equity and the responsibilities of local governments in budgeting and financial planning.