Murphy touts 'financially responsible' proposal

StayNj tax cut for seniors program will not begin until 2026

By: Katie Sobko
NorthJersey.com
USA Today Network - New Jersey

..... New Jersey's top three elected officials announced an agreement on property tax cut for seniors in Trenton on Wednesday. [06/21/2023]
..... The program will not begin until 2026 and is admittedly complex to implement Governor Phil Murphy said.
..... The governor, speaking with Assembly Speaker Craig Coughlin and Senate President Nick Scutari by his side, said the newly reached compromise - the StayNJ initiative - is a "fiscally responsible agreement and noted that he and the legislative leaders are "working to build a stronger and fairer New Jersey that is affordable for all of our hardworking families."
..... Initially proposed by Coughlin last month, [05/2023] StayNj survived as part of a budget deal that will include some of the tax relief Coughlin had sought in his initial plan and addresses some concerns Murphy had expressed.
..... "This agreement says we care about our seniors and making New Jersey affordable for all," Murphy said. "That extra money in their pockets goes a long way ... we will continue to work to ensure that everyone in New Jersey can live out their best years with dignity."
..... Coughlin said he proposed the program as a way to address affordabllity because "seniors who have done so much for our state should have the freedom to stay in their homes near people they love in the communities they built."
..... He also noted that the program will affect 97% of senior homeowners.
..... The plan is "game-changing," according to Scutari who went on to say the state has 'so much to offer" and that people "want to stay here."
..... Elvyn Lieberman, the director of advocacy for AARP New Jersey, commended leadership for the compromise.
..... "The framework of the deal will provide the kind of bold and transformational relief that so many New Jerseyans - who are also struggling to afford rising prices on everything form groceries to gas along with the highest prescription drug prices in the world - need to stay in New Jersey," she said.
..... But not everyone was so supportive. Senator Joseph Pennacchio, R-Morris, called the proposal cartoonish.
..... "If StayNJ is really affordable and sustainable and something New Jreseyans should expect to provide relief for years to come, why make them wait three years to get a first payment?" he asked. "Tye can't guarantee they'll be able to fund the program they're promising today in 2026, even though they'll campaign on it this fall. [0223] It's completely disingenuous, and it defies belief."
..... And while state officials are optimistic about the new program, Mu0prhy did say it will be "challenging and difficult."

What comes next?

..... The plan will not go into effect until 2026.
..... The delay is for a few reasons - to give the economy a chance to bounce back, because the program is so complex and needs a "runway" to make suer the state does things right, and because the increased ANCHOR payout is being given to seniors in the interim.
..... But even when it comes time to craft the fiscal year 2026 budget, only half of the first year's funding will have been saved at that point. Ensuring that StayNJ is fully funded is not something Murphy, Coughlin or Scutari can guarantee. The full Legislature is on the ballot this fall [2023] and will be again in 2025 when the governor's seat is also up for grabs.
..... Murphy said he'll still be in charge and is confident Scutari and Coughlin will be as well, but that he thinks it will be "wildly popular" and will receive bipartisan support.
..... The governor did note that the bill is clear in saying there is an obligation to fully fund the pension program and education before paying into this plan, and he was willing to rule out raising taxes for a tax relief program.

What's in the plan?

..... The deal would allow for New Jersey to meet its obligations for a full pension payment, full fund school aid payments and maintain the large surplus the governor built into the budget plan he proposed in February. [2023]
..... The new program is expected to cost about $1.3 billion and will include renters as well.
..... The agreement wouldst aside around $140 million fro fiscal year, 2024 and 2025. In addition, the state would set aside about $100 million, $200 million and $300 million fore each of the next three years, respectively.
..... Coughin's initial plan had no income limit, but the new plan put a cap on income at about $500,000, with a projected 90% of eligible recipients having incomes of less than $200,000. another change would be lowering the overall payout from $10,000 to $6,500.
..... This deal will also allow seniors to get a $250 credit each year until 2026 through the ANCHOR program. that increases for renters, to $700 form $450, will remain in effect.
..... One amendment to the proposed bill was the expansion of the Senior Freeze program, which Murphy included in his proposed budget for fiscal year 2024. The expansion of eligibility would include seniors earning up to $150,000, a $50,000 increase, and would decrease the residency requirement from 10 years to three years. It remains in the new agreement.
..... Among the biggest changes to Coughlin's proposal is that StayNJ will now be implemented as a single program - rather than a combination of three.
..... A commission will make recommendations by next May [2024] on how to make that possible, because ht logistics of the plan in its previous form also were a concern for the governor's office.
..... The plan is for the money to come in the form of a tax credit beginning at the start of 2026.
..... Although Wednesday's [06/21/2023] press event projected an air of agreement, the budget process hasn't been without tensions. When Coughlin and Scutari first proposed StayNJ last month [05/2023] as a property tax credit program, it was met with resistance form the executive branch.
..... Murphy said at the time that there were a few things about the bill that were concerning, with the "biggest one" being the expense 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.
.... Murphy's office was said to be preparing for all possibilities, including a government shutdown, through the governor himself noted 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."
..... The news comes as final notations for the fiscal year 2024 budget are made between the governor's office and the Legislature. A tentative schedule supported by Scutari on Tuesday [06/20/2023] included a Senate Budget Committee meeting next Tuesday [06/27/2023] and then a full Senate vote session on Friday, June 30. [2023]
..... The Senate persistent said the session would be held in the morning and that he would expect Murphy to sign the budget into law that afternoon, with mere hours to spare before the current budget expires.

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