Democratic leadership announced a deal for Gov. Phil Murphy’s property tax relief plan he offered as part of his 2023 Financial Year budget earlier this year, providing $2 billion worth of relief for two million New Jerseyans this year.
Murphy made the announcement with State Senate President Nicholas Scutari (D-22) and Assembly Speaker Craig Coughlin (D-19) for the Affordable New Jersey Communities for Homeowners and Renters (ANCHOR) Tax Relief Program, increasing this investment from the nearly $900 million proposed in March to over $2 billion and will reduce property taxes for over 1.16 million homeowners and 900,000 renters.
“It’s a big day, there is no other way to put it…up to $1,500 of direct property tax relief,” said Murphy. “Taking your property taxes bill back to the level they were a decade ago…days like that do not happen every day in New Jersey.”
Spending the Surplus
The deal comes as the state has a surplus of over $6 billion due to increased tax revenues in the last year.
“This unprecedented growth that we have seen in New Jersey has increased state revenues to historic levels,” Scutari said. “We have an obligation to give that money back (to taxpayers).”
According to the governor’s office, the average New Jersey property tax bill was approximately $9,300 in 2021. ANCHOR’s direct property tax relief rebates could offset over 16% of the average property tax bill in New Jersey for some homeowners. For a middle-class family receiving the $1,500 in direct relief, the average bill will effectively become $7,800, a property tax level New Jersey has not seen since 2012.
“This is a truly historic tax relief program for our state…tax relief starts with delivering on past promises of lessening the impact of local property taxes,” said Murphy. “Today we take a step forward on this administration’s promise to make New Jersey a stronger, fairer, more affordable state for our middle-class and working families.”
“It is a promise kept.”
The ANCHOR program expands on and replaces the Homestead Rebate Program, which serves 470,000 homeowners annually and provides an average benefit of $628. Renters are not eligible for the current Homestead program, but ANCHOR recognizes that rents are often raised to offset rising property taxes.
ANCHOR will make over four times more New Jerseyans eligible to receive a property tax rebate when compared with Homestead—Murphy said the program will ultimately reach 5.5 of the 9.3 million residents.
Under the expanded ANCHOR Property Tax Relief Program proposal, there will be a full phase-in of rebates and the benefits will be simplified:
- 870,000-plus homeowners with a household income of under $150,000 would receive a $1,500 property tax credit on their property tax bill each year
- 290,000-plus homeowners with a household income between $150,000 and $250,000 would receive a $1,000 property tax credit on their property tax bill each year
- 900,000-plus renters with incomes up to $150,000 would receive $450 each year to help offset the rent increases caused by increasing property taxes
“This is something that has always been thought of but never acted upon,” said Coughlin. “This will put money in (residents) pockets and have them do things….that will make it better for themselves and their families.”
The governor said negotiators have kept making New Jersey more affordable “front and center for our families.” It was a buzzword that politicians on both sides of the aisle have adopted after Jack Ciattarelli used it last year to almost defeat Murphy in the 2021 gubernatorial election.
“We know that property taxes put pressure on our middle class and workers on a good day, but the pressure they are facing now in a time of hyper-global infarction is even greater,” he said. “It makes our mission more urgent.”
Murphy, Scutari and Coughlin all stressed that the program is to be replicated for the years to come and that there would be more savings to taxpayers when a budget agreement is reached by the end of the month.
“It is extremely important to ensure that these programs are sustainable and any additional tax cuts and investments continue beyond this fiscal year and I know I have that commitment from the leaders to do that,” said Scutari. “While we’re announcing a two billion dollar program today, I continue to look forward to additional targeted programs helping middle-class taxpayers.”
For Coughlin, the ANCHOR program goes to his pledge that this year’s budget has the largest tax relief program in state history.
“We are going to be able to achieve that,” said Coughlin. “Two billion dollars-there’s never been a commitment of that size to reducing (property taxes). This will truly be impactful for the state of New Jersey.”
Rebuking the GOP
In promoting the agreement, Murphy seemingly rebuked the Republicans’ Give it Back as one that is based on unsustainable budget gimmicks.
“Moreover, we are not focused on one-time relief that some in Trenton are,” said Murphy. “We are not focused on tax-break gimmicks which would overly benefit those at the top. We are not focused on giveaways to big corporations. That has all been tried before. Suffice it to say that those broken promises and misguided priorities are the reason our middle class families felt no one in Trenton cared about them to begin with.”
The state’s budget must be passed by June 30.