A new report on state-funded property-tax relief programs calls for streamlining the current application for benefits starting early next year.
The recommendation to improve the application process was among many included in the report submitted to Gov. Phil Murphy and lawmakers by a task force of experts on Thursday.
If carried out, the revised application would seemingly address a key concern among New Jersey seniors who can receive the tax relief benefits from various state programs only after they fill out numerous applications, each with different requirements for those benefits.
Meanwhile, the submission of the report itself keeps on track, at least procedurally, plans to establish an altogether new property-tax relief program for New Jersey seniors, beginning in early 2026.
However, the report suggests it will take more time than originally envisioned before the increased relief benefits promised to seniors as part of the proposed new program can be delivered directly as credits on quarterly property-tax bills instead of as checks or direct deposits.
The state has software and technology issues
The task force members cited a need for the state to upgrade its software and other technology before being able to deliver those direct credits, suggesting at least a one-year delay before direct credits could be issued to eligible recipients.
A big unanswered question is whether the state will have the long-term financial ability to sustain the new property-tax relief program for seniors, while also covering other multibillion-dollar financial obligations. These include funding full public-worker pension contributions and aid allocations to K-12 public schools — all while managing a structural budget gap that is expected to total nearly $2 billion during the new fiscal year that begins July 1.
Left unclear is exactly how the state will fund the proposed Stay NJ program beyond the initial year.
The formation of the six-member tax-relief task force was required under a law enacted by Murphy and the Legislature nearly a year ago amid an increased focus on easing the burden of New Jersey’s record-high property-tax bills, including for seniors living on fixed incomes.
The same law also called for the state to begin setting aside funding for the new program dubbed Stay NJ, currently expected to debut in early 2026.
In the meantime, Murphy and lawmakers agreed to increase benefits provided to senior homeowners and renters via the popular Anchor property-tax relief program, and to also expand eligibility for the long-standing Senior Freeze program, which also provides state-funded property-tax relief benefits to senior and homeowners with disabilities.
The possible timeline
Under the recommendations of the task force, which counted a former state treasurer among its members, the streamlined application for property-tax relief benefits would debut no later than February 2025.
Among other changes, the benefit year and residency requirements for all state programs should generally become universal for applicants of all ages, the report said.
‘This kind of regressive spending program would widen the racial wealth gap and, ironically, make the state less affordable for many lower and middle-income families.’ — Peter Chen, New Jersey Policy Perspective
However, meeting the requirement of providing direct credits on quarterly property-tax bills is not something that could begin in early 2026, as was originally envisioned, according to the report, which was unanimously endorsed by the six members of the task force.
“In sum, the lack of necessary systems, software, trained staff, and databases needed to implement credits require much more preparation time than the existing timeline in the law allows,” the report said.
Also left unclear is exactly how the state will fund the proposed Stay NJ program beyond the initial year, while also continuing to provide benefits through other programs, such as Anchor.
Long-term viability?
The $56 billion state spending plan Murphy has proposed for the 2025 fiscal year sets aside $200 million for Stay NJ, adding to the $100 million earmarked for the same purpose in the budget for the current fiscal year. Under current law, the allocation for Stay NJ would grow to $300 million during the 2026 fiscal year.
The combined $600 million that would be earmarked for Stay NJ over the next several fiscal years is enough to cover the initial Stay NJ benefits that would be provided during the second half of 2026 fiscal year, the report said.
Then the cost of the program would rise to $1.2 billion, or more, starting with the 2027 fiscal year, subject to appropriation by the Legislature at the time, according to the report.
No specific source of revenue has been identified to cover the cost of the new program during a full fiscal year, raising concerns among some about its long-term viability.
Critics have also questioned why such a high level of funding is being earmarked for senior homeowners when it’s low-income renters who likely face the biggest threat of being displaced in New Jersey due to rising bills.
“This kind of regressive spending program would widen the racial wealth gap and, ironically, make the state less affordable for many lower and middle-income families,” said Peter Chen, senior policy analyst at the Trenton-based New Jersey Policy Perspective think tank.
