Christie offers property-tax compromise

TRENTON - Gov. Christie offered the Legislature a compromise on property taxes Thursday, but ordered lawmakers to reconvene over the Independence Day weekend to discuss the issue, setting up a possible showdown with the legislative branch.

Christie told lawmakers in a special session he called Thursday that he was willing to forgo a constitutional amendment to cap property-tax increases, but without all the exceptions Democratic lawmakers have proposed.

In a 14-minute speech, Christie thanked lawmakers for approving a budget on time, but said "the job is not complete" until they also addressed New Jersey property taxes, which are the highest in the nation.

The governor hinted in his speech that he would not let the Legislature rest until he was satisfied members had addressed the issue. His call for a July 3 session came late Thursday. On Wednesday, he called for a special session to convene Friday. He has no legal authority to dictate the Legislature's agenda.

Christie said that he was offering lawmakers a choice of a constitutional cap or a 2.5 percent statutory cap, but that inaction was not an option.

"We will work every day until we do one or the other," Christie said. "We cannot take a vacation when our citizens get no vacation from escalating property taxes. We do not deserve a break when these taxes are breaking the backs of our families. We cannot leave this town for the summer and leave our citizens with an ever-growing property-tax bill to pay because we refused to act."

The Legislature typically breaks for summer recess after the budget is adopted, but legislative leaders already had pledged to continue working through the summer on property-tax changes.

Christie previously proposed a 33-bill property-tax "tool kit," the centerpiece of which was a constitutional amendment capping property-tax increases at 2.5 percent annually, with an exemption for debt service. Under the governor's original proposal, the cap could be overridden by 60 percent of those voting on the issue.

Democrats, under the leadership of Senate President Stephen Sweeney, of Gloucester County, responded to the 2.5 percent cap with a counterproposal of a statutory 2.9 percent cap with several exceptions, including loss of state aid, health-care costs, and pensions. There was no provision for a voter override of the cap under the Democrats' proposal because, they argue, over time, it would exacerbate differences between wealthier towns and poorer ones.

Both proposals would have allowed towns to bank amounts under the cap for future years. Under current law, towns face a cap of 4 percent, with several exceptions.

Christie on Thursday proposed a 2.5 percent statutory cap with exceptions only for capital expenditures, including debt service, and for employee contracts in place at the time the cap has taken effect. He would still allow voters to override the cap with a 60 percent majority, spokesman Michael Drewniak said.

Before Thursday, the governor had urged lawmakers to adopt legislation to put the constitutional amendment on the November ballot. That would have required legislation to clear committees in both houses by July 6 or 7.

Democratic leaders said they welcomed Christie's change of heart on the constitutional amendment but made it clear he would not determine their schedule or their agenda.

Assembly Speaker Sheila Oliver (D., Essex) said the Assembly Budget Committee would meet Friday to consider the various property-tax-cap proposals and said the lower house was "more than willing to work with the governor."

Before the governor's decision to call a Saturday session, Oliver said, she had not decided whether the Assembly would meet over the weekend.

"We'll be here tomorrow," she said. "I can't go beyond that."

The Senate budget committee would meet Friday morning, Sweeney said, adding that he did not intend to call the Senate in over the weekend.

Sweeney and Christie met Thursday evening, and the Senate leader offered to meet with the governor over the weekend.

"I'll be here Saturday, Sunday," Sweeney said. "I don't have a life."

The Senate has fulfilled its constitutional obligations by convening a session at the call of the governor, Sweeney said, citing lawyers at the nonpartisan Office of Legislative Services.

Patrick Murray, a political analyst at Monmouth University, called Christie's counterproposal a brilliant strategic move and a "compromise in sheep's clothing."

"This is the governor asking for exactly what he wanted, except not in constitutional form," Murray said. While the conflict may be between Christie and the Democratic lawmakers, Murray said, the real audience was the public at large.

"This is not just about convincing the Democrats in the Legislature to do it his way; this is also about convincing the public that he is on the job 24-7 to reduce property taxes, because he knows, at the end of the day, his reelection prospects all rest on whether he reduces property taxes by 2013."

The Senate will have hearings over the summer, possibly one day a week, on the property-tax proposals and would consult with experts, Sweeney said.

He said he believed the public would realize that the property-tax cap in Massachusetts, the model for Christie's proposal, has not worked out the way the governor has led people to believe. People have to pay so much in new taxes and fees, Sweeney said, for things such as streetlights and for sports and other extracurricular activities for students.

Thursday began with great drama when Sweeney invited Christie to speak to the upper house at 6 p.m., even though the governor had planned to address both houses together at 3 p.m.

Sweeney then decided to join the Assembly at 3 p.m., he said, because the governor had indicated he would propose a compromise on the property-tax-cap proposal.