With affordability a continued buzzword entering budget season, a bill that has nearly 10 years of history behind it is getting new life.
Bill S-330/A-1012 would increase the amount of funding distributed to municipalities from the Energy Tax fund to $330 million over five years, starting in 2023. It is scheduled for a vote in the Senate Budget & Appropriations Committee on Monday.
NJBIA is supporting the bill as it requires municipalities to use the new funds to reduce their property tax levy.
“Property taxes are a business issue, too,” NJBIA Vice President of Government Affairs Christopher Emigholz said in written testimony to the committee. “New Jersey’s property taxes are the highest in the nation and represent the largest state and local tax that businesses pay.”
Emigholz noted that New Jersey businesses pay $14.9 billion in property taxes, out of $31.7 billion in total state and local taxes.
“The $330 million distributed amounts to about a 1% reduction in total statewide levy of more than $31 billion,” he said.
Once upon a time, energy taxes were collected by individual municipalities until the state began collecting those receipts for the convenience of the public utilities. The state would then pass those funds to local government.
In 2008, however, those funds were diverted to the state’s general fund as part of a change in budget language.
The New Jersey State League of Municipalities estimates that approximately $14 billion in energy tax funds have been diverted from municipalities to the state’s budget since 2002.
A first version of this legislation was co-authored by then-Assemblymen Troy Singleton and Jay Webber in 2012.
Singleton, chair of the committee, is primary sponsor of the current bill with Senate President Nick Scutari.