South Jersey counties get more for tax money

Schools and governments in Atlantic, Cape May and Cumberland counties got more back in state aid than they sent to the state in income and sales tax revenue in fiscal 2010, according to a report released Monday.

Ocean County got back a little less in state aid than it contributed in income and sales tax, the report from the Edward J. Bloustein School of Planning and Public Policy at Rutgers University said.

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The “spatial analysis” report addressed only how major state taxes and aid programs are collected and distributed, and not all revenue sources. The data is not intended as a commentary on state policy, but simply informational, said Joseph J. Seneca, a Rutgers professor and one of the authors of the report.

“We are just looking at where the major revenues come from, and where they go,” Seneca said.

Sales and income tax made up 70 percent of the state budget revenue, or $18.2 billion in fiscal 2010. Of that, $12.1 billion, or 41 percent of the total state budget was returned to municipalities, counties and schools as state aid, according to the report.

William Dressel, executive director of the New Jersey League of Municipalities, noted that 2010 also was the year before massive cuts in municipal property tax relief and school aid, and the state’s biggest tax policy problem remains overreliance on property taxes.

While the report was no surprise to people who follow state funding, it does show the diversity in how wealth and state aid are distributed around the state.

Jon R. Moran, senior legislative analyst for the League of Municipalities, said because wealthier people have higher incomes, they pay a greater share of total income taxes and are likely to buy more expensive items.

The per capita income in fiscal 2010 was highest in Somerset County at $69,886 and lowest in Cumberland County at $33,907, according to the report. Per capita incomes were $39,746 in Atlantic County, $40,291 in Ocean County and $47,498 in Cape May County. The statewide per capita was $51,139.

Somerset County sent $836 million in tax revenue to the state and got back $209 million, according to the report. Cumberland County sent $94 million to the state in taxes and got back $336.3 million in state aid, most of it in aid to its three largest school districts, Vineland, Millville and Bridgeton, which are all considered high-poverty districts.

Local legislators said the disparities in revenue versus aid do generate discussion in Trenton, especially during budget season.

“I’m sure I’ll hear about it on the Budget Committee,” state Sen. Jeff Van Drew, D-Cape May, Cumberland, Atlantic, said. People are still surprised to discover just how many poor people live in the southern part of the state, he said.

“People just assume everyone living near the shore is wealthy and laying around on the beach,” he said. “But on every list, we are at the bottom. Cumberland especially has huge challenges, and there are not a lot of people making a lot of money.”

Both he and Sen. Jim Whelan, D-Atlantic, said the report does show the importance of tourism in generating revenue for the state. Both Atlantic and Cape May counties were among seven counties that generated proportionally more sales tax revenue per capita, which the report attributed to tourist spending.

Seneca said sales tax dollars in general can’t be attributed to residents of just one county, because large shopping centers or tourist areas will attract people from other areas.

Whelan also said the report does not include gaming revenue, which funds programs that benefit residents statewide.

“Tourism is a huge part of the New Jersey economy, not just in sales tax revenue, but also in the jobs” it provides, he said.

Seneca said the school data reflect Supreme Court decisions and legislative action that have provided more money to the state’s neediest schools.

David Sciarra, executive director of the Education Law Center, which has represented children in low-income districts, said the report confirms New Jersey’s commitment to making sure all children get a high-quality education.

The center released a statement last week saying that while high-poverty districts do spend more per student, those funds are used to address the additional services they need. If those extra funds are removed, the state’s high-poverty “priority” schools spend about the same as the state’s high-performing ”reward” schools.

“Since our public education is among the best in the nation and world, the taxpayers’ investment in the education of all of our children brings huge dividends to the entire state," Sciarra said.

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