File #: 12-1014    Version: 1 Name: Calling for restoration of Energy Tax Revnue.
Type: Resolution Status: Filed
File created: 4/23/2012 In control: Municipal Council and City Clerk
On agenda: 5/2/2012 Final action: 5/2/2012
Title: Dept/ Agency: Offices of Municipal Council/City Clerk Action: ( ) Ratifying (X) Authorizing ( ) Amending Type of Service: Urging/Supporting/Opposing the Restoration of Revenue to the Municipalities Purpose: Calling for the Restoration of the Energy Tax Revenue to Local Governments Additional Information: Sponsor Gonzalez
Sponsors: Carlos M. Gonzalez
Title
Dept/ Agency: Offices of Municipal Council/City Clerk
Action:  (   ) Ratifying     (X) Authorizing     (   ) Amending
Type of Service: Urging/Supporting/Opposing the Restoration of Revenue to the Municipalities            
Purpose:   Calling for the Restoration of the Energy Tax Revenue to Local Governments                       
Additional Information:  
   Sponsor Gonzalez                 
body
 
 
WHEREAS, taxes on gas and electric utilities were originally collected by the host municipalities to be used for local purposes and to compensate the public for the use of their rights of way; and
 
WHEREAS, when the State made itself the collection agent for these taxes, it promised to dedicate the proceeds to municipal property tax relief; since, just as municipalities collect property taxes for the benefit of school districts, counties and other entities; the State is supposed to collect Energy Taxes for the benefit of municipal governments; and
 
WHEREAS, for years, though, State budget makers have diverted funding from Energy Taxes to fund the State programs; and instead of being spent on local programs and services and used to offset property taxes, the money has been spent as successive Legislatures and Administrations have seen fit; and
 
WHEREAS, while the State  may need to have the right to over-ride the statutory dedication of these revenues to local governments, in order to deal with emergencies and crisis that may occur; current State policy makers should not exercise that right automatically; and
 
WHEREAS, while that right should be the exception, it has become the rule; and
 
WHEREAS, by using tactics such as reducing CMPTRA, which is also comprised of revenues that should be returned to municipalities, State Budget makers have been able to continue collecting Energy Taxes, while keeping additional revenue that should have been returned to provided property tax relief; and
WHEREAS, from $72 million in State Fiscal Years 2005, to $505 million in State Fiscal Year 2011, the State's diversion of Energy Taxes has continued to grow; and
 
WHEREAS, in 2008, 2009 and 2010 (SFY 2009, 2010, and 2011), funding for municipal revenue replacement was slashed by about $26 million in 2008 and $32 million in 2009, followed by losses of about $271 million in 2010; and
 
WHEREAS, the cumulative impact of years of  this diversion of revenues has left many municipalities with serious needs and burdensome property taxes; and
 
WHEREAS, local elected officials are in the best position to decide the best use for these resources, which were always intended to fund local programs and services;
 
NOW THEREFORE BE IT RESOLVED,BY THE MUNICIPAL COUNCIL OF THE CITY OF NEWARK, NEW JERSEY, THAT:
 
We join with the League of Municipalities in calling for the immediate restoration of funding diverted from Energy Taxes intended for local use.
 
We respectfully call on State policy makers to end the diversion of our municipal resources  to cover State spending and to provide us with this important tool to relieve the worst-in-the-nation property tax burden borne, for too long, by the people of New Jersey.
Copies of this Resolution be forwarded to the Governor of the State of New Jersey, our State Legislators and the League of Municipalities.
  
          
              
STATEMENT
 
This resolution calls upon the Governor of the State of New Jersey and the State legislative leadership to restore the energy tax revenues, collected by the State on behalf of the municipalities but is currently being diverted to State programs, to the local governments from which they were collected..