Gusciora: State Should Stop Skimming Energy Utility Taxes from Municipalities

Assemblyman says the practice is the ultimate “robbing Peter to pay Paul.”

Editor's Note: The following is a news release issued by Assemblyman Reed Gusciora.

Deputy Majority Leader Reed Gusciora (D-Trenton) will introduce a measure next week to stop the State from skimming energy utility taxes collected by the State’s Energy Tax Receipts Property Tax Relief program on behalf of municipalities. 

 Historically, these taxes were payments from utilities in lieu of local property taxes for the public right of ways for sewerage lines, water, gas and electricity.  Gusciora says the Christie Administration’s proposed continued diversion of these funds is the “ultimate robbing Peter to pay Paul, especially in light of less aid going to the municipalities.”

Gusciora’s legislation calls for the restoration of these energy tax receipts to the municipalities and returns the municipal aid to FY2010 levels.  The bill further requires that municipalities, who received this aid in FY2010, can not receive a lesser amount in any subsequent fiscal year.

“Our municipalities are laying off police, teachers, and other public employees in order to comply with the Governor’s so called ‘tool kit,’ which includes a 2 percent spending cap on local budgets,” said Gusciora.  “But with the diversion of more utility tax receipts combined with less municipal aid, it has resulted in a chain saw massacre on our towns and cities across the State.”

Gusciora noted that this year, the State took almost half of the energy taxes for the State’s general fund and administered the remaining half back to the municipalities under the label of “State aid.”  The Assemblyman labeled the latest proposed diversion as “unconscionable.”

“With the restoration of municipal aid through the payment of these energy taxes, local governments can truly live within their means.  These taxes are just compensation,” concluded Gusciora.  “After all, this is about an estimated two billion dollars that can be used for direct property tax relief to the municipalities.”

John May 09, 2012 at 01:59 PM
Way to go Assemblyman! Finally a state lawmaker who has the stones to point out the real problem with municipal taxes. The state takes monies owed to the municipalities to balance it's budget then blames local towns and their employees. Absolutely right, you cannot call for spending caps with declining ratables and at the same time keep the town's money.
Stinki Garbaage May 09, 2012 at 05:31 PM
Has the stones? What a sham. Thank goodness the state takes this money to force to municipalities to address the problem, which is perks, pensions, automatic pay raises, nepotism, longevity pay, civil rights abuses and cover-ups in the administration, etc. all while they spend, spend, spend to feed their massive machine. anyone ever see "Little Shop of Horrors?" FEED ME............ Clearly the assemblyman wants to do this to turn the spigot back on a keep all these perks and benefits to pay off his friends who will continue to carry the spirit of the day - Spend, Spend, Spend Enough already! Make due. Why do these government hacks simply not hear what the residents are saying. Figure out how to make due with less taxes. period.
John May 09, 2012 at 06:28 PM
The only sham lies with the state government. Let me illustrate for you... Let's say I'm a business owner (aka-State of New Jersey). I tell my customers (aka-NJ Taxpayers) that I offer my products (aka-Services provided by the state) at a very reasonable rate. Now, the cost of everything from toilet paper to fuel to the rent for my storefront is increasing. How do I continue to provide my products at such a reasonable rate? I stop paying the full amount owed to my vendors and landlord (aka-Municipalities). That is how I do it. I then tell the vendors and landlords (Municipalities) that not only am I going to pay you less for your services and land use but since I have the customers on my side, I'm not going to pay you at all if you complain. I then will tell you that since I have such a strong hold on you, I hereby order that you can't raise your rent. All the while, my customers appear to get my products cheaply and any increases are because of the landlords and vendors. I have successfully shifted the blame from me (State of NJ) to my debtors (Municipalities). I come out smelling like a rose.
Stinki Garbaage May 09, 2012 at 06:46 PM
your analogy doesn't work at all. business and customers are free to invest their money where they want. this is about government that is too big at every single level starting with the municipality, the county, the state, all the way up to the federal government the only people with guts are the ones who suggest less spending. more spending is the easy, popular, lazy, old way of doing things. put these people to work, or they can leave and let people who are willing take over.
John May 09, 2012 at 07:07 PM
You are right, it doesn't work at all. That is why the Assemblyman is trying to do the right thing. He is not suggesting we don't need to make cuts, he is suggesting the cuts being forced by the state's actions are the wrong cuts. He did not say anywhere that municipalities should be spending more. If the state paid the rent, property taxes would not be rising at the level they are now and rising with reduced services.


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