N.J. Div. of Local Government Services, N.J. Dept. of Community Affairs
Saying that municipal budgets need to reflect “consistency with the economy,” Marc Pfieffer updated the mayors on various proposals and actions in Trenton — including one effort to contain property taxes by severely constraining local government. On that proposal to cap municipal budget increases at 2.5% annually by amendment to the state constitution, Mr. Pfeiffer received an earful from the mayors in return. A number of attendees questioned the practicality of the proposed amendment. Mr. Pfeiffer made note and said those thoughts need to be communicated to policy makers. Pfeiffer also covered a number of suggested reforms that include revisions of collective bargaining and binding arbitration, Civil Service reform, and changes in employee pensions and benefits. (Be sure to read Mr. Pfeiffer’s email below, which includes a PDF of proposed legislation.)
Mayors listened with concern to the discussion of a constitutional spending cap.
In an email after the meeting to association secretary, Carl Block, Marc Pfeiffer wrote: “Thanks for the opportunity this morning. However, shortly after the meeting I discovered I inadvertently misled the group on the Cap 2.5 proposal with regard to debt and capital improvements.
After the meeting I spoke with Ron Dancer and we took a look at ACR-131, the current version of the referendum proposal, and discovered that I missed an important change on how capital is handled from the original version and original proposal.
To the relief of Mayors, the proposal DOES NOT require public referendums for capital improvements. Nor does the proposal mandate amounts for capital or debt service to be subject to the cap. The proposals leaves with the legislature the ability to set laws on how capital and debt service will be handled.
I apologize for missing that point when I spoke – it did generate the liveliest of discussion on the proposal – but the way the proposal is currently drafted, the treatment of capital and debt services will be left to legislative action and not be part of the constitutional limitation.
Can you please share this with the group to ensure the message is passed along.”
Mr. Pfeiffer also included a PDF copy of Assembly Resolution 131 proposing a hard 2.5% cap by constitional amendment. You can download it here: Assembly Resolution 131