Once again, property taxpayers are hit with unexplained increases out of Trenton that do harm to municipal budgets. We hear about property tax relief. We are told that our elected state officials have a strong commitment to reducing the property taxes that make New Jersey one of the most tax burdened states in the country. Yet the actions belie the words.
This year, the public employee health plans in the state saw an enormous hike in premiums. Workers and local governments were confronted with 20%-plus increases all to be absorbed in one year. Again, the spin doctors went to work and we were told this was a result of a sharp increase in claims following the pandemic when many individuals put off routine health care. The beleaguered state officials burdened with their formula–driven approach to premium setting had no choice but to impose the unprecedented hike in premiums.
Yet there did seem to be a modicum of choice available when Gov. Phil Murphy made an immediate deal with state worker unions, leaving local government employees out in the cold. There did seem to be some measure of choice when the governor ignored calls for him to use federal relief dollars hoarded in Trenton to cut the burden of the health care hike. After all, if the pandemic is the reason we are given for the hike in claims, why not use pandemic relief funds? No real explanation was forthcoming.
In Cape May County, several municipalities have presented 2023 budgets that call for increases in property taxes. One reason given uniformly is the rise in employee health care. Across the state, some towns are looking at leaving the state health care program. Cape May is exploring a shift to the Southern Coastal Regional Employee Benefits Fund. Ocean City voted to leave the state plan within two months after the hike was announced. What happens if municipalities across the state continue to move out of the state program? Costs will go up for the majority who remain.
Yet we never get answers. Why was New Jersey’s double digit increase in employee health care premiums among the highest such increases in the country? Didn’t the whole country suffer from the pandemic? We will not get an explanation because a genuine response would have to get into issues of vendors, contracts and oversight that officials feel are best not discussed.
Locally, taxpayers are confronted with decisions that enshrine expense benefit programs, health care among them, into long term contracts that leave little flexibility when flexibility is needed. Often the only option available is not an adjustment to benefits but rather an increase in taxes.
What we do know is that the actions in Trenton are a much stronger indication of sincere concern than are promises of property tax relief. There was no reason to make a deal with state employee unions and leave local governments out in the cold. There was no good reason to refuse access to banked federal relief dollars to ease at least some of the burden being passed on to local municipalities. There certainly was no good reason for Trenton’s failure to explain why the double-digit hikes in worker health care premiums had to lead the nation.
Trenton owes state property taxpayers a true explanation for the magnitude of the increase in employee health care premiums. It owes an explanation for why state employee unions could cut a deal not available to the towns. It owes an explanation for why the hike the governor and many members of his executive team knew about months before the news broke was not shared earlier in the budget planning process.
Don’t hold your breath waiting for those explanations. New Jersey is well entrenched as one of the top five states in the union with the worst total tax burdens. What the health care premium issue this year did accomplish is it provided a window into the world of why those tax burdens are so great.
We will not get the explanations to which we are entitled because an informed public was never a goal. When you cash that Anchor program check amid fanfare about property tax relief, keep an eye out for the other hand that is reaching for your wallet.
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From the Bible
The plans of the diligent lead to profit as surely as haste leads to poverty. Proverbs 21:5
