This Is How Much Property Tax Relief You'll See In New NJ Program

NEW JERSEY — Gov. Phil Murphy touted the proposed expansion of the ANCHOR Tax Relief Program as "truly historic." Republicans in New Jersey felt otherwise.

But Democratic leaders supported Murphy on Wednesday as he announced he would broaden the ANCHOR (Affordable New Jersey Communities for Homeowners and Renters) that his administration proposed earlier this year. The program would replace the Homestead Rebate and provide $2 billion in relief for more than 2 million New Jersey homeowners and renters, Murphy says.

The ANCHOR program, which would take effect in Fiscal Year 2023, must get through the budget-development process though. Murphy and the State Legislature must agree on a budget by June 30. Read more: $2B In Proposed NJ Tax Relief Would Help 5.5M People, Gov. Murphy Says

Both sides of the political aisle agree on one thing: New Jerseyans need some help with the state's high taxes and cost of living. The Garden State has the nation's highest effective property-tax rate, according to Quicken Loans.

The average New Jersey property-tax bill in New Jersey was $9,284 in 2021 — among the highest in the nation. Inflation and pandemic-related economic consequences have made it more difficult for many residents to keep up with New Jersey's cost of living.

Here's a breakdown of how much New Jerseyans would save under the ANCHOR proposal, according to the Murphy administration:

Homeowners with a household income of less than $150,000

• Rebate: $1,500
• How many households impacted: 870,000
• Total cost: $1.31 billion

Homeowners with a household income between $150,000 and $250,000

• Rebate: $1,000
• How many households impacted: 290,000
• Total cost: $290 million

Renters with incomes up to $150,000

• Rebate: $450
• How many impacted: 900,000
• Total cost: $405 million

Unlike the current Homestead Rebate, the ANCHOR program would also benefit renters. Rent in New Jersey has skyrocketed during the pandemic, going from a 2020 average of $1,772 for a one-bedroom apartment to $2,414 last year — a 36.22 percent increase, according to a rent.com analysis.

According to the figures the Murphy administration provided, eligible homeowners and renters would receive an average rebate of $971. The Homestead Rebate, which serves 470,000 renters, has an average benefit of $628.

Democratic leaders — including State Senate President Nicholas Scutari and Assembly Speaker Craig Coughlin — touted the administration's proposal to expand the ANCHOR program.

"It is extremely important to ensure that these programs are sustainable and any additional tax cuts and investments continue beyond this fiscal year and I know I have that commitment from the leaders to do that," Scutari said. "While we're announcing a $2 billion program today, I continue to look forward to additional targeted programs helping middle-class taxpayers."

But Republicans in the State Legislature have different views. State Senator Michael Testa (R-1) called the plan "underwhelming" compared to the "Give It Back" rebates GOP lawmakers have introduced. The plan would return $3 billion in "tax overcollections" to 4 million New Jersey families through $1,000 rebates.

"This is likely a sign that Democrats are more focused on divvying up billions of pork in the budget than providing New Jersey families with real tax relief this year," Testa said.

Assembly Republican Leader John DiMaio called the proposed ANCHOR expansion "a big-government gimmick."

"Injecting steroids into Murphy's recycled rebate program won't get anyone more excited about it than when Murphy announced it in February," DiMaio said. "It doesn't deliver meaningful changes in fiscal policy and will be the first program to get cut when money is tight."