NJ Speaker’s Property Tax Plan is Generational Warfare

A rare house for sale in Princeton, and NJ Assembly Speaker, Craig Coughlin

A battle has broken about among New Jersey’s governing Democrats about how to set the state budget. On one side, the NJ Assembly speaker, Craig Coughlin, has proposed a new plan called “Stay NJ”, which would have the state pay half of the property taxes of all homeowners over age 65. On the other side, Governor Phil Murphy has said that he will veto any such program.

Although New Jersey’s property taxes are infamously high, extending a 50% tax credit to over-65s only seems like an act of madness. Coughlin says that property tax relief for seniors is necessary to help retirees stay in New Jersey. But figures released this week from the US Census of 2020 show that the population of over 65s in New Jersey grew by 32.7% between 2010 and 2020. That’s a similar increase to what was seen in many other states, including several low-tax states with warmer winters.

In contrast, the population of kids aged under 5 in New Jersey shrank by 7.2% between 2010 and 2020. The population of kids aged 5-17 also dropped, by 1.2%. This isn’t something that you see everywhere. In Florida, for example, the population of kids aged 5-17 increased by 8.2%. The Census evidence shows that it is working families who are struggling to find a place in New Jersey. Asking families to pay full property taxes, while seniors get a 50% credit, is likely to worsen these existing demographic trends. It would make more sense to extend a tax credit to everybody, as was done with the recent ‘Anchor’ program.

It’s not hard to see why families with children struggle to find a place to live in New Jersey. In addition to property taxes, housing is extremely expensive. In many communities, it’s a struggle to even find homes under a million dollars these days, because very few homes are on the market. This is largely a result of a long period of low interest rates. Longtime residents refinanced their mortgages at very low rates, and are not inclined to move, which means that families have to pay a premium. A massive property tax cut for seniors is likely to make this problem even worse.

Another issue is that many towns try to do whatever it takes to keep families with school-age kids out of their community. It has become normal to hear people objecting to development that might provide homes for school-age children, as if children are some kind of terrible burden for society. This is something that goes on around the state, and even Princeton School Board officials have occasionally made statements expressing ambivalence about having more kids in the district. The state could provide more school aid. Or we could invest in higher education and transit, which are in crisis and are needed by working families. And we should be building more homes – for families and seniors – so that nobody is pushed out of their community. But giving a massive tax cut to seniors only is basically an act of generational warfare.

This entry was posted in Affordability, People, Real estate and tagged , , . Bookmark the permalink.

1 Response to NJ Speaker’s Property Tax Plan is Generational Warfare

  1. Ross Hatton says:

    We need to lower taxes for seniors who have contributed to society and are living mostly on social security. Period

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