Jul 28, 2014

Mayors Discuss Local Impact Of Energy Tax Receipts

Mayors advocate for the return of revenue taken from energy tax receipts back to municipalities.

Mayors Discuss Local Impact Of Energy Tax Receipts

Residents were left with the question of where is their municipalities' energy tax receipts going last night during a G.E.T.–R. Money Back Mayor’s Forum with Mayors from Middletown and Brick.

Twenty attendees brought their concerns about the direction of government and the impact of the energy tax receipts on municipalities to forum held at the Middletown Township Public Library.

In the past, utility companies would pay energy taxes instead property taxes to municipalities.

But about 20 years ago, an agreement was signed between utility companies and the State where instead of sending checks to each municipality, a single check was sent to the state, said Brick Mayor Steve Acropolis. 

“Every time you send money to Trenton you get less back,” Acropolis said. 

This year the amount collected by the state was $1.2 billion.  The municipalities receive about $0.50 to every dollar collected, he said.

On the local level, Middletown Mayor Anthony Fiore addressed the impact of energy tax receipts and its impact on the Middletown municipality.

“This is something that I have been public about,” Fiore said.

Since 2004, Middletown has lost more than $15 million that should have been averted to municipalities from the energy tax receipts, he said.

In 2011, Middletown would have received $4 million from energy tax receipts, Fiore said, which the township did receive but the amount of municipal aid from the state was reduced by about that amount.

“If we received one-quarter of what we were supposed to receive in 2011 [without the reduction in state aid], we would have had a zero percent increase,” Fiore said.

Fiore said it was “quite an experience” meeting a two percent tax cap in Middletown.

In Brick a referendum was passed in 2011 to exceed the two percent tax cap, Acropolis said.

Taxes went up by $8 million and Brick lost about $10 million from state funding over the last two years, Acropolis said.

Looking for solutions to bring revenue taken from energy tax receipts back to municipalities, Acropolis suggested the municipalities gather and file a class action lawsuit

“It may not go anywhere but it would bring attention to the issue,” he said.

Another solution mayors suggested was pressuring local mayors and officials, asking them to contact members of the Assembly.

“This is an issue that is a very tangled web,” Fiore said. “The governor is doing what he can for the moment but he doesn’t have the legislators behind him.”

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