TRENTON, N.J. -- A plan to be unveiled Tuesday by top legislative leaders calls for Gov. Jon S. Corzine to address the Legislature and convene a special session to consider reforming New Jersey's highest-in-the-nation property taxes.
The plan, to be announced by Senate President Richard J. Codey and Assembly Speaker Joseph Roberts Jr., has the potential to develop into New Jersey's first major tax system overhaul in three decades. It's scheduled to be announced Tuesday morning.
Codey wouldn't comment and Roberts could not be reached on Monday, but several legislative officials knowledgeable about the proposal, who spoke on condition of anonymity, said the legislative leaders will ask Corzine to call the Legislature into special session in July so he can discuss property tax reform.
The Assembly and Senate would then form groups that would spend the rest of the summer developing an agenda for a special legislative session that could be held in the fall, the officials said. The agenda would include topics such as school funding changes, public employee pension reforms and shared government services.
If successful, it would produce the first major reform to state tax law since the income tax was created in 1976.
Gov. Jon S. Corzine's office declined to comment in detail on Monday.
``We will let the legislative leaders make their own announcement, but we look forward to moving together in the spirit of cooperation,'' Corzine spokesman Anthony Coley said.
The impending announcement was hailed by the state League of Municipalities, a leading property tax reform advocate.
``It's a big step forward when you can get the Senate president and Assembly speaker to speak as one on our state's most pressing problem,'' said Bill Dressel, the league's executive director.
The state relies heavily on local property taxes to fund county and municipal government and school operations. State aid is also used, but the state hasn't increased aid for five years and property taxes have risen about 7 percent annually in recent years. I n New Jersey, the property tax accounts for about 45 percent of local tax revenue, compared to a national average of 30 percent.
Property taxes are considered among the most regressive taxes, with the state households earning the lowest 20 percent seeing 9.2 percent of their income on property taxes and the state's richest households paying 3.6 percent.
The average New Jersey homeowner pays about $6,000 per year in property taxes.
Legislators have long called for a special session, but critics have complained it was doomed to fail without a detailed agenda, and none has been developed.
A number of previous attempts have failed to produce results.
In 1972, a plan by Gov. William Cahill to create a statewide property tax and an income tax and rework the sales tax failed 52-23 in the Assembly and Cahill lost his re-election bid in the Republican primary.
Twice in recent years the Assembly has approved legislation to ask voters to elect delegates to a special convention that would propose changing the state Constitution to reduce property tax reliance, but the Senate has never considered the plan.
Dressel said municipal leaders want a convention to be part of any discussion in the special legislative session.
``Without it, as far as we're concerned, the promise for permanent property tax relief would be seriously doubtful,'' he said.
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