Phil Murphy, governor of New Jersey, speaks during the 2023 State of the State Address at the New Jersey State House in Trenton, New Jersey, US. (Getty Images)
New Jersey Gov. Phil Murphy and fellow Democratic leaders in the Legislature announced a deal Wednesday on a sweeping property tax rebate plan that had been a sticking point amid negotiations over the state’s more than $50 billion budget.
Murphy, Assembly Speaker Craig Coughlin and Senate President Nicholas Scutari said homeowners 65 and older who make $500,000 or less will qualify for up to $6,500 in property tax relief under their plan. Renters would also get up to $700 in rebates.
Those benefits will take until 2026 to ramp up fully, Murphy said, but seniors and renters can expect to see $250 in immediate relief if the plan passes.
The program could be complex to roll out, and the economy could use more time to improve, Murphy said by way of explaining why it wouldn’t take full effect right away.
The program will cost $1.2 billion once fully implemented, the governor said.
It still must be voted on by the Democratic-held Assembly and Senate, which are considering the governor’s $53.1 billion proposal ahead of a July 1 constitutional deadline to enact a balanced budget.
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The leaders said it’s needed to stem the flow of seniors leaving the state for more tax-friendly locales, particularly in the South.
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“This agreement says we care about our seniors and making New Jersey affordable for all,” Murphy said.
Coughlin added: “This will give people the opportunity to stay in New Jersey. It is the right thing to do, not just for seniors, although they’ll get the checks. The benefit really extends to all of the family.”
Republicans criticized the plan, which the Democrats are calling “StayNJ,” calling it an election year gimmick aimed at wooing seniors.
“Trenton Democrats are trying to buy votes this year with the promise they’ll deliver StayNJ property tax relief starting in 2026,” state Sen. Joe Pennacchio said.
All seats in the Legislature are on the ballot this November.
The plan had become a sticking point among top state Democrats as the end of the fiscal year approaches. As originally proposed by Coughlin, the program would have offered up to $10,000 in benefits to seniors. It also didn’t have an income cap or include renters.
Coughlin had made it clear he wanted to include senior property tax relief in this year’s budget negotiations. Murphy described the agreement as the result of the men trying to find a “fiscally responsible” solution.
State revenues fluctuate from year to year, and certain line items are required under New Jersey’s constitution, like education spending.
That has sometimes made it difficult for earlier administrations to fully fund all promises made by governors and lawmakers.
Murphy expressed optimism that it will be within the state’s means to fund the plan and still meet other obligations such as education and pension funding.
New Jersey has among the highest property taxes in the country, with the average bill approaching $9,500 a year. The taxes pay for local government and schools.
