If Gov. Chris Christie is successful in his effort to eliminate realty transfer fees, it would eliminate $25 million in annual funding the state uses to match the cost of beach protection projects along the Jersey Shore, much of which was devastated by Hurricane Sandy.
What affect that would have on the push to rebuild the Shore and make it more resilient to extreme storms is uncertain. Many of the projects now underway are fully funded by the federal government, but that may not be the case in the future, according to conservationists.
“Beach nourishment projects are not a permanent fix to storm hazards,” said Tim Dillingham, executive director of the American Littoral Society. “The need for the state to have a source of funding will not go away.”
The Republican governor suggested that the tax be repealed at a town hall meeting in Franklin Township in Somerset County. “A realty transfer fee, from my perspective, makes no sense,” Christie said in response to a questioner who complained about paying exorbitant fees when he sold his house.
The proposal, although greeted warily by conservationists, won quick endorsement from a realtors group and a Republican state senator, who vowed to introduce a bill to repeal the fee.
The realtors association argued that eliminating the fees would help all homeowners around the state, particularly those facing foreclosure or short sale. “We look forward to working with the governor and our state’s legislators to repeal the realty transfer fee and help New Jersey’s homeowners,” said Jarrod Grasso, chief executive officer of the New Jersey Association of Realtors.
Sen. Diane Allen (R-Burlington) yesterday said she would introduce a bill to repeal the tax. “When you sell your home in New Jersey, you’re getting whacked by this arbitrary tax and that is wrong,” she said in a statement released by the GOP Senate office.
Others said that repealing the fee could imperil efforts to restore the Jersey Shore.
Without the state realty fee, there is no match to get the work done, claimed Jeff Tittel, director of the New Jersey Sierra Club. “It’s an example of playing to the public without thinking about the consequences,” he said.
Beyond just drying up shore protection funding, abolishing the fee would create another hole in an already fiscally strapped state budget.
This year, the state budget expects to collect $287 million from the fund, and another $325 million in the upcoming fiscal budget year. The transfer fee ranks as one of the biggest sources of revenue in the state, although far behind income taxes, corporate taxes, and sales taxes.
Kevin Roberts, a spokesman for the governor’s office, dismissed fiscal concerns. Any reduction in taxes would be addressed in the full context of a budget and full spending plan that takes into account the tax being cut, he said.
“As the governor said yesterday, the Legislature has shown little appetite to cut taxes directly for New Jersey families, including the governor’s proposed middle class property tax cut that went nowhere in the Legislature,” Roberts said.
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