Only Real Change Can Bring Real Property Tax Reform

Commentary by State Senator Bob Smith, D-17


            Last Tuesday, voters throughout New Jersey went to the polls to vote in their local school board elections.  In 550 towns and cities, voters were asked to elect member of their Boards of Education and approve the proposed school budgets.  Most of these budgets called for property tax increases, adding to New Jersey’s earned reputation of having the highest property taxes in the nation.  In central New Jersey, the average increase was 6 percent, or $177 dollars per household. 

            There are many explanations for the need to increase taxes, most notably a reduction in state aid to school districts as a result of New Jersey’s record budget deficits.  But this cannot be the only reason, because even in times of budget windfalls, property taxes still rise.  School board officials point to rising costs in health insurance, utilities, transportation, special education programs, and salary increases.

            Yet, at the heart of these problems is the fact that New Jersey has 566 municipalities and 619 school districts, some of which do not even have any students!  Common sense would tell you that there must be a tremendous amount of redundancy and duplication of services in these districts.  Each district has its own price tag, which includes an administration, transportation system, educational program costs, suppliers and other services.  All of these cost taxpayers millions of dollars.

            Consolidating our school districts into 21 county-based systems, as many other states do, would save millions and would make a real impact on property tax rates.  Imagine the savings alone if we only had 21 school superintendents.  Each district would be able to contract in bulk for health insurance, bussing, and school supplies such as textbooks.  Special needs programs could be centralized and targeted towards those schools that actually need them.  The list of potential savings is endless.  At the same time the quality of education does not have to suffer, in fact, it can be improved!

            The arguments against proposals by those who favor the status quo defend New Jersey’s tradition of “home rule”.  They contend that different districts have different needs that can only be served by local school districts. 

I do not accept this argument.  One third of all states have county-based school systems and manage to meet the needs of their students, while keeping property taxes down with tremendous cost savings.  Our tradition of home rule is outdated and inefficient.  Changing times call for new ideas.  Property taxes will not be lowered through stopgap measures and rebates.  Only by fundamentally modernizing our ideology and streamlining the programs that property taxes fund will we be able to make a real impact on the cost of living in New Jersey.


Bob Smith is a State Senator representing Piscataway, New Brunswick, Highland Park, Franklin Township, North Brunswick and Milltown.  He is a member of the Senate Environment and Judiciary Committees and has served as a member of the legislature since 1986.