The pain of the nation’s highest property taxes once prompted the hope that combining New Jersey municipalities would result in cost-saving efficiencies. That hope has been dashed many times over, but the proposal lives as a convenient myth to distract taxpayers.
The latest retelling of this myth centers on a bill passed recently by the Legislature that supposedly would encourage municipalities to combine. As usual, legislators tout this as a way to eliminate duplicated services, reduce public employees, cut costs and lower taxes. That not only sounds too good to be true, but has been shown to be false in theory and practice.
The basics of the story remain unchanged. The nation’s fourth-smallest state has 565 municipalities. Surely two towns that became one could drop an engineer, counsel, police chief, fire chief, public works supervisor … who knows how many employees.
This part of the myth collides with reality in two places. One, despite the views of disgruntled taxpayers, there probably aren’t a lot of government workers who don’t provide any meaningful service to the public. Two, the public’s demand for services and the spending habits and employment preferences of elected officials and public unions would remain the same after a municipal merger.
The Bloustein Local Government Research Center studied this in 2014 and found there is no truth to the “hypothesis” that consolidation would automatically yield savings. While there could be marginal savings to begin with, consolidation “might just as readily result in undesirable and/or unintended consequences.”
The poster child for municipal mergers is that of Princeton borough and township, which combined in 2013. Two years later, officials there claimed $2.3 million in annual budget savings. But they also increased staffing costs by $436,000 per year and added $714,000 for trash pickup, according to The Princeton Packet. The mayor said people require a level of services and more spending was justified. That year, the town had the highest property taxes in Mercer County, at an average $17,800.
That’s also the only merger of towns in the past 60 years, so the possibility of consolidations is even less likely than their potential savings.
A 2014 Rutgers-Eagleton poll found that support among New Jersey residents for municipal mergers dropped nine points in four years to 45 percent, while opposition rose eight points to 46 percent.
Not only are town mergers unlikely to happen, unlikely to save money if they did, and unlikely to be encouraged by the current bill — which, for example, would mandate terminal leave payments to employees whose jobs were eliminated — but the bill itself is unlikely to become law. Last year, Gov. Chris Christie pocket-vetoed a similar measure.
The truth is, legislators have it in their power to reduce spending and lower taxes whenever they want. They don’t want to, and so they would prefer to turn the attention of taxpayers elsewhere, especially in an election year.