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Mayors sign letter asking for full funding of energy tax relief fund

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The mayors say the restoration of funds is long overdue

Some 422 mayors are asking lawmakers to provide full funding of the Energy Tax Receipts Property Tax Relief Fund in the state’s Fiscal Year 2024 budget.

In a signed open letter to Gov. Phil Murphy and the state Legislature May 16, the mayors call for allocating $350 million in the state budget to restore full funding for property tax relief.

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Among the mayors to sign the letter include mayors from East Windsor, Lawrence Township and Princeton.

The Fiscal Year 2024 budget starts July 1.

The letter to Murphy and the state Legislature was issued by the New Jersey State League of Municipalities, the New Jersey Urban Mayors Association and the New Jersey Conference of Mayors.

Taxes on natural gas and electric utilities and telecommunications companies had been collected by each municipality and used as a source of revenue, the letter said. The state began collecting the taxes and redistributing the money to the municipalities in the 1980s.

The Energy Tax Receipts Property Tax Relief Fund Act of 1997 repealed the taxes and created the Energy Tax Receipts program, the letter said. Towns were supposed to receive at least the same amount of money they had received in the past for property tax relief.

But state officials have diverted funding from energy taxes and used the money to plug holes in the state budget and to pay for state programs, the letter said. Restoring the money that has been diverted and giving it back to the municipalities is long overdue, the letter said.

East Windsor Mayor Janice Mironov, who is the immediate past president of the New Jersey Conference of Mayors and a past president of the New Jersey State League of Municipalities, said the money must be restored.

“It is well past time for the diversion by state officials of this municipal funding, intended for local property tax relief, to end,” Mironov said.

Municipal governments are facing financial challenges and difficulties, she added.

Mironov cited large increases in health care premiums for employees, pension increases, soaring costs for trash and recycling collection and disposal, and increased insurance costs that are affecting the municipalities.

“They are driving costs that will ultimately be borne by property taxpayers without relief,” she said.

Lawrence Township Mayor John Ryan said he was in support of state legislation for full funding.

“The money has been diverted for over a decade,” he said. “The money is sitting there. The money is owed to the municipalities from the energy tax.”

Full funding of the property tax relief fund would help municipalities, he said.

Princeton Mayor Mark Freda said that withholding some money for property tax relief has caused property owners to pay more in local taxes every year.

“With the high municipal tax burden that so many property owners face in New Jersey, all of the money should be returned to the municipalities starting this year,” he said.

The state government has a significant surplus, and it needs to learn how to set a budget that does not rob municipal coffers, Freda said.

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