Parsippany Mayor Tells Legislature To Return Town's Energy Tax Money

PARSIPPANY, NJ — Mayor James Barberio has joined mayors from across the state in requesting that the legislature release funds 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.

Barberio is arguing that this money is a necessary first step toward addressing property tax affordability and offsetting other costs.

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 continued diversion of dedicated energy tax receipts to the state budget has jeopardized critical property tax relief funding. Municipalities have made difficult choices when funding was reduced and have been forced to reduce staff, cut or reduce services, and find other ways to keep balanced budgets," the New Jersey League of Municipalities said.

Barberio, along with other elected officials, is 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.

Increasing property taxes have been a source of concern for many Parsippany residents, with several residents opposing the recently passed town budget, citing a persistent tax burden on the community.

The fiscal year 2023 budget calls for a 3.76 percent increase in the town's property tax levy and a 2.57 percent overall tax increase, which equates to an estimated $100 more per year per homeowner, based on the town's average home valuation of $313,000.

The budget was approved 4-1, with Councilman Justin Musella casting the lone dissenting vote, arguing that the administration was "overburdening taxpayers with large tax increases."

However, according to Barberio and the other council members, the budget has already been reduced as far as it can go without harming the township.

In signing the New Jersey State League of Municipalities letter, Barberio has stated that he is 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.