Murphy, legislative leaders formally unveil StayNJ compromise plan

After several weeks of private and public battles over the “StayNJ” senior property tax relief proposal, Gov. Phil Murphy and Democratic legislative leaders announced a deal today that keeps most of the prospective program intact while limiting its benefits to wealthy homeowners.

The compromise, which was first reported by the New Jersey Globe on Sunday, would give New Jerseyans over 65 making less than $500,000 a year an annual tax credit equal to 50% of their property tax bill, with a cap of $6,500. Seniors would start receiving the credit in 2026, after several years of working out logistics and stockpiling money to fund the program.

“We’re proud to announce that we have reached a fiscally responsible agreement to provide historic property tax relief to our seniors,” Murphy said today while flanked by Assembly Speaker Craig Coughlin (D-Woodbridge) and Senate President Nick Scutari (D-Linden). “Our work together continues to show how New Jersey can deliver for our residents and act like the adults in the room when it comes to how our institutions and government should function.”

StayNJ was originally the brainchild of Coughlin, who put forward his initial proposal in late May; he was quickly joined in his efforts by Scutari, and has been accumulating legislative support ever since. Under their plan, the annual credit cap was $10,000, and there was no income limit for recipients.

Murphy and his administration pilloried that initial plan; his chief of staff, George Helmy, told Politico NJ that it was “unimplementable” and would disproportionately help those who already have plenty of money. That briefly raised the specter of a government shutdown if Murphy and legislative leaders couldn’t come to an agreement before June 30, when the state budget is due.

But after negotiations, the three top leaders were evidently able to come up with something that all could agree to.

“We worked through it together, and have come to what I think is a terrific place that addresses the concerns, provides for long-term stability, and offers seniors a real opportunity,” Coughlin said.

Added to the plan is a boost to the ANCHOR program, a separate property tax relief plan created last year – including for senior renters, who were completely shut out of the initial legislative plan. Also part of the deal is the creation of a StayNJ commission, appointed by the governor and legislative leaders, that will be tasked with overseeing the implementation of the complex program over the next several years.

And the proposal affirms that pension payments and education funding should be given higher priority than StayNJ if all three can’t be fully funded, a provision which the Murphy administration pushed for in order to guarantee future fiscal stability.

“This is a very responsible way of taking the original legislation that the Speaker had introduced and making it work,” Scutari said. “I’m really happy that the governor was able to make those numbers work, still provide a really fiscally responsible budget, and give people the number one thing they’ve been asking for for all these years: help us with our property taxes.”

StayNJ is set to be pushed through the legislature as a package of bills rather than as part of the larger state budget. That means legislators will have the opportunity to vote separately on the budget and on StayNJ – a tough choice for Republicans who want to support property tax cuts but are opposed to the Democratic plan.

“StayNJ is the Democrats’ election-year ploy,” Assembly Minority Leader John DiMaio (R-Hackettstown) said in a statement released earlier today. “It does nothing to erase their two decades of bad policy decisions that drove up costs and put us in this expensive mess.”

But as Murphy argued today, this is likely to be a popular program, one that legislators won’t want to vote against and that politicians of the future will be reluctant to undermine.

“I think this is going to be wildly popular,” Murphy said. “No matter what party you’re in, no matter what your persuasion, it’s going to be a hard thing to turn your back on.”