Bill Text: NJ A3673 | 2014-2015 | Regular Session | Introduced
Bill Title: Permits cities of first class to opt out of county service when that service is provided by city; provides for reduction in city's portion of county property tax levy and for property tax credits.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2014-09-18 - Introduced, Referred to Assembly State and Local Government Committee [A3673 Detail]
Download: New_Jersey-2014-A3673-Introduced.html
Sponsored by:
Assemblyman CHARLES MAINOR
District 31 (Hudson)
SYNOPSIS
Permits cities of first class to opt out of county service when that service is provided by city; provides for reduction in city's portion of county property tax levy and for property tax credits.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning the duplication of services provided by counties and certain municipalities and supplementing Title 54 of the Revised Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. As used in this act:
"Director" means the Director of the Division of Local Government Services in the Department of Community Affairs.
"Duplicative service" means a service provided by the county in which municipality is located for which there was an appropriation for that service in the county budget for the previous fiscal year and which service is also provided by the municipality.
"Municipality" means a city of the first class as defined in subsection a. of N.J.S.40A:6-4.
2. A municipality, pursuant to a resolution of the governing body adopted by a majority of the full membership thereof, may choose to no longer receive a duplicative service. The municipal clerk, upon passage of the resolution, shall prepare a certified copy thereof and shall cause such certified copy to be served upon the clerk of the board of chosen freeholders and the county tax administrator of the county in which the municipality is located. Such certified copy shall be served within 10 days from the date of adoption. The resolution shall take effect on January 1 of the next following year, subject to the approval of an application by the director pursuant to section 4 of P.L. , c. (C. ) (pending before the Legislature as this bill).
3. A municipality that has adopted a resolution pursuant to section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill), may apply to the director for a duplicative service credit to reduce property taxes. A credit shall be granted for each calendar year during which the municipality provides a duplicative service. A municipality may receive a duplicative service credit through a net reduction in the apportionment valuation thereof, determined pursuant to R.S.54:4-49. The formula for determining the amount of a duplicative service credit shall be:
DSC = (MEV/CEV) x AA
and shall use the following variables, where:
DSC is the amount of the duplicative service credit to be credited against the municipality's apportionment valuation;
MEV is the municipal equalized valuation for the current tax year;
CEV is the county equalized valuation for the current tax year; and
AA is the amount appropriated for the county service in the preceding year.
4. The director shall establish procedures for the awarding of duplicative service credits. The director shall provide for an application process that is concurrent with the timetable and process of setting property tax rates. That process shall ensure that the duplicative services are comparable and that the elimination of the duplicative service in a municipality results in municipal savings for the cost of services, reflected as future budget reductions, limits on future cost increases, or such other criteria as the director may deem relevant. The director shall review applications annually and determinate whether a municipality is eligible to receive a duplicative service credit. If the director fails to approve or disapprove an application within 30 days, it shall be deemed approved.
5. a. Each parcel of property shall receive a reduction in the total property tax obligation during each calendar year in which the local unit receives a duplicative service property tax credit.
b. A duplicative service property tax credit shall be applied to each parcel of property each year as follows:
(1) The county tax administrator shall certify to the county board of taxation, by May 1 of each year, the total duplicative service property tax credit to be applied to the municipality's apportionment valuation for that tax year.
(2) When the table of aggregates is prepared pursuant to R.S.54:4-52 for each municipality, a tax credit rate shall be calculated by dividing the total duplicative services credit by the total equalized taxable value of residential property.
(3) The tax credit rate shall be multiplied by the equalized taxable value for each parcel of property, the product of which shall be deducted from total taxes due, before deductions, on each residential property for the tax year. The tax credit rate and amount shall be displayed on the tax bill.
c. Notwithstanding the provisions of R.S.54:50-8 to the contrary, the Director of the Division of Taxation in the Department of the Treasury may provide such information as he deems necessary to the municipal assessor or the county tax administrator to implement the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).
6. This act shall take effect immediately.
STATEMENT
This bill intends to promote the elimination of duplicative services offered by counties and municipalities that are cities of the first class. The bill provides that the governing body of a municipality that is a city of the first class may, by resolution, choose to no longer receive a duplicative service provided by the county in which the municipality is located. A duplicative service is defined as a service provided by the county in which the municipality is located for which there was an appropriation for that service in the county budget for the previous fiscal year, and which service is also provided by the municipality.
After the resolution is adopted, the municipality may apply to the Director of the Division of Local Government Services in the Department of Community Affairs for a duplicative service credit to reduce property taxes. The bill requires the director to establish procedures for the awarding of duplicative service tax credits and provide for an application and award process that is concurrent with the timetable and process for setting property tax rates. The process must ensure that the duplicative services are comparable and that the elimination of a duplicative service will result in cost savings to the municipality. If the director fails to approve or disapprove an application within 30 days it is deemed approved.
If the director approves the municipality's application, the duplicative services tax credit would be awarded as a reduction in the amount the municipality is required to raise through the property tax levy for county purposes. The bill establishes a formula for determining the amount of a duplicative service credit. In order to achieve a reduction in property taxes, the duplicative services will be applied as a property tax credit against each parcel of property within the municipality. The bill requires a municipality to apply annually for a duplicative service tax credit.
