NJ seniors could get property taxes break with StayNJ plan


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May 20, 2023

NJ seniors could get property taxes break with StayNJ plan

A trio of bills aimed at cutting property taxes for New Jersey seniors — that

A trio of bills aimed at cutting property taxes for New Jersey seniors — that has drawn criticism from the governor — cleared committee with bipartisan support Thursday.

The bills, introduced by Assembly Speaker Craig Coughlin, would cut property taxes in half for seniors and expand eligibility to certain health benefit programs.

The main bill defines the StayNJ plan, a proposal to address lowering tax costs for seniors to ensure they stay in New Jersey instead of flocking to states with lower costs of living. It was amended to include the expansion of the senior freeze program, which Gov. Phil Murphy included in his proposed budget for fiscal year 2024. That program reimburses eligible seniors and disabled people for property taxes.

Murphy's Chief of Staff George Helmy said that "Coughlin has been an incredibly strong partner" to the governor when it comes to "addressing long-standing inequities in our state and delivering historic property tax relief for our middle-class and working families.

"While we have serious challenges with the current version of the bill, we share the goal of streamlining the process and delivering even more tax relief to our seniors," Helmy said in a statement. "We look forward to working closely with the speaker to see this relief delivered in this budget."

The amendment also acknowledges that funding the StayNJ program will not interfere with schools funding, a $250 property tax deduction for veterans or a $250 property tax deduction for seniors and disabled persons.

The other two bills in the package would impact health care benefits for seniors. The first increases eligibility for Medicare Savings Programs by eliminating the asset test — meaning measuring how much wealth you have — for Medicare Savings Benefits and increasing the income threshold to 200% of federal poverty, which is around $30,000 for one person. It would provide Medicare Savings to an additional 163,000 seniors and cost the state $224 million.

The second would expand eligibility to the state's prescription plans Senior Gold and PAAD. With the latter being increased to cover all seniors up to 400% of federal poverty level and the former being offered to all other seniors. The cost would be about $14 million per year.

Before the Assembly Aging and Senior Services committee heard testimony and voted on the three-bill package, Coughlin talked about why he thinks these bills matter. He told the committee about seniors who face financial burdens that "threaten their dream" of retirement in the communities they have lived in.

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"We have to do better for those very people who built this great state," Coughlin said. "The commitment to our 500 plus communities and our 600 plus school districts has a price and seniors who are on fixed incomes are disproportionately asked to pay that price."

Coughlin said that he's "confident the state can afford these programs" and said that while there are some differences between the Legislature and the governor, they are not on the "basic premise" that "seniors are important and we should do more for them."

Coughlin also noted that ANCHOR payouts for renters would increase by $50 as well.

Coughlin said last month that the StayNJ plan would cost the state more than $1.2 billion annually.

The program would establish a property tax credit program to provide anyone over 65 a property tax credit equal to 50% of their tax bill. While there is no income limit for eligibility, the credit would be capped at $10,000.

The bill would appropriate $300 million in Fiscal Year 2023, $300 million in Fiscal Year 2024, $600 million in Fiscal Year 2025, $800 million in Fiscal Year 2026, $1 billion in Fiscal Year 2027, and $1.2 billion in Fiscal Year 2028 and each fiscal year thereafter.

The tax credits would be issued to residents beginning Jan. 1, 2025.

It would also expand senior freeze to seniors earning up to $150,000, a $50,000 increase and decrease the residency requirement from 10 years to three years.

Senate President Nick Scutari introduced companion bills in the upper chamber of the Legislature as well. He said at the time that the legislation is a "game changer" and that the state is "now in the business of reducing taxes and making the state a more affordable place for people to live, work and retire."

Coughlin said he intends there to be a one-page application for this program as well as the ANCHOR program —which stands for Affordable NJ Communities for Homeowners & Renters — and the homestead property tax reimbursement program. State employees would be responsible for determining which payout would higher, the StayNJ payout or a combined ANCHOR and homestead reimbursement payout.

Assemblywoman Beth Sawyer, R-Gloucester, expressed concern about the sustainability of the program and suggested an income cap as a way to limit the yearly budget impact.

"This bill has great bones. Any relief to seniors is great but I’m concerned about the amount of money this is going to put on taxpayers to sustain this," she said.

Mayors Stephen Dalina of Monroe and Jonathan Hornik of Marlboro Township respectively testified about how important seniors are to their communities.

"This bill would strengthen our communities for generations to come," Dalina said. "It would help keep families together. This bill would give seniors an extended vested interest in the future of the towns they currently reside."

But not everyone was in support of the bill. Ellen Steinberg and Peter Humphreys of the Senior Citizens Council of Union County said that while they support the "spirit of the proposed legislation" they had suggestions to "ensure it can deliver consistent, long-term property tax relief for seniors." They were concerned about funding.

Similarly, Peter Chen of the New Jersey Policy Perspective said that it's "not clear that this would help the seniors in most need to age in place where they live" and that in its current version the bill would provide 41% of the benefit to the top 20% in income while only 5% would go to the bottom 20%.

Committee Chair Assemblywoman Angela McKnight noted that the benefit isn't automatic and that people would have to apply.

"We’re not making it mandatory that homeowners who are up in this high income bracket go ahead and apply," she said. "We talk about people having options… it's an option for a millionaire who lives in New Jersey to apply for this program."

Sawyer responded that "with all due respect, those rich people all have accountants and I promise you they are going to take every tax credit they can for their client."

The new legislation faces an uphill battle. There's already been opposition from the governor, with the executive branch even preparing contingency plans for a potential government shutdown if the plan in its current form makes it into the final budget.

Murphy has said that there are a few things about the bill that are concerning, with the "biggest one" the expense being added to the budget where "we’ve got revenues that are softening already" and another being that it "would be for everybody" so even millionaires like Murphy would get a break.

The governor did note that he has a great relationship with Coughlin and the Legislature overall and that both sides are "focused on seniors and making the state more affordable." But in the end he said that he doesn't think "we should be in the business of giving the likes of me tax breaks so we’re serious" about a shutdown.

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