Mendham Mayors Tell Legislature To Release Town's Energy Tax Money

MENDHAM, NJ — The mayors from Mendham and Chester have joined over 400 mayors from across the state in urging the legislature to release money that they claim the state is withholding from local governments.

The mayors of 401 of New Jersey's 564 municipalities have signed a letter urging the legislature to fully fund the Energy Tax Receipts Property Tax Relief Act, which would increase funds available to local governments from $75 million to $350 million.

The mayors argue that this money is a necessary first step toward addressing property tax affordability and offsetting other costs.

The issue revolves around taxes on public land used by gas and electric utilities, which were previously collected by the host municipalities before the state stepped in and took over as collection agents.

The letter was issued by the New Jersey State League of Municipalities (NJLM), the New Jersey Conference of Mayors (NJCM), and the New Jersey Urban Mayors' Association (NJUMA).

The elected officials are requesting that the Energy Tax Receipts Property Tax Relief Act be fully funded in the 2024 fiscal year New Jersey State budget.

Municipalities used to collect taxes from utility companies that used public rights-of-way. These taxes were no different from the property taxes paid by residents of the township.

The state eventually became the collecting agent for these taxes, promising to return the proceeds to municipalities for property tax relief. But this has not occurred.

"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," the open letter said.

For years, state officials on both sides of the aisle have diverted funds from energy taxes to fill budget gaps and fund state programs. The mayors believe that restoring this funding to municipalities is long overdue and that it would return funding to 2008 levels for all municipalities.

Mayors Nick Monaghan, Christine Serrano Glassner, Janet Hoven, and Michael Inganamort have stated that they are committed to limiting their reliance on increased property taxes while meeting local needs such as critical public safety and health needs.

"We thank you for your consideration and for hearing our concerns and urge your immediate action as part of the 2024 fiscal year New Jersey state budget process," the mayors said in a press statement.