New Jersey lawmakers yesterday postponed a vote on a $28.6 billion fiscal 2010 budget and a measure to expand tax increment financing after Gov. Jon Corzine announced that an extra $600 million or more in revenue from the state’s tax amnesty program would help restore property tax rebates that had earlier been cut.
The Legislature will take up the bills Thursday after additional budget hearings on Monday. Fiscal 2010 begins July 1.
On March 10, the governor presented a fiscal 2010 budget that suspended property tax rebates for all homeowners other than senior citizens, saving the state roughly $500 million, to help offset weak revenue collections. Unanticipated funds from the tax amnesty program could reinstate the property tax relief program for some additional homeowners.
“This extraordinary development must be appropriately considered by the Legislature,” Corzine said in a press conference to announce the windfall. “In that review — and this is the important part — I want to convey in the strongest possible terms my commitment to using these recovered resources to provide middle-class homeowners with much-needed property tax relief.”
“Let me be clear, when revenues fell, the last item we cut was property tax relief,” he said. “Now that we’ve recovered some lost revenues, the first thing we will restore is property tax relief.”
The state has collected more than $600 million in taxes through the amnesty program, which waived penalties and half of the interest owed on unpaid business and personal income taxes. Corzine said the state has thousands more of unopened envelopes to process, which could bring the total collections to $700 million.
When the program began in March, the New Jersey Treasury Department anticipated receiving about $200 million in back taxes. The last day of the amnesty period was June 15.
Due to the revenue announcement, legislative leaders yesterday postponed voting on the fiscal 2010 budget. Also moved to next week is a vote on a state economic stimulus measure aimed at sparking business development by using TIF districts, called revenue allocation districts in New Jersey, as a financing vehicle.