By Valerie Vainieri Huttle, Stephanie Hunsinger and Melissa Chalker
Susan Sherman’s family has been in New Jersey since 1850, once proud operators of the historic Daniel Bermes Boulevard Brewery. Susan is a nurse; she would normally be on the frontlines of the COVID-19 pandemic but she is not working because her husband is ill and she cannot afford to risk bringing the disease home.
The emotional and financial burdens she and her husband are experiencing due to COVID-19 were exacerbated when they lost their Homestead Benefit credit due to state budget cuts this summer. It’s already a struggle to be a homeowner in New Jersey – with the state’s highest property taxes in the nation – and now this lifeline that was helping to keep their beloved home and community was suddenly gone.
The Sherman’s story is not unique. So it was very welcome news when, in August, Gov. Phil Murphy proposed restoring the Homestead Benefit and Senior Freeze property tax relief programs as part of the state budget that will begin on Oct. 1. Now, it is up to the Legislature to adopt the governor’s proposal and take it one step further to ensure the Sherman’s and the thousands of other families who depend on property tax relief programs get the help they need.
While Governor Murphy’s proposal does restore the Senior Freeze program and Homestead Benefit, it does not pay homeowners for the Homestead Benefit money they lost earlier this year when the programs were cut. Many families are facing financial shortages for all their basic needs. That partial credit, worth several hundred dollars for many, would have helped put food on the table, allowed many to afford their prescription drugs and other essentials.
While restoring the May 2020 benefit can’t put back the food that was lost, or cover the prescriptions that were not filled back in the spring, it will provide the support needed to ensure these basic necessities are met now. This is especially important as New Jersey doesn’t plan on crediting the upcoming property tax bill with the Homestead Benefit until next year, which will again lead the Sherman’s and others to face the heart-wrenching tradeoffs between tax bills and these life necessities this fall.
New Jerseyans, particularly older residents and those with disabilities living on low, moderate and fixed incomes, have always struggled with New Jersey’s high property taxes. On average the annual Social Security income in New Jersey is approximately $20,200. Social Security is the only source of income for three in 10 New Jerseyans. Nearly six in 10 New Jersey retired elder-only households lack sufficient annual incomes to insulate them against poverty as they age. According to the New Jersey Department of Human Service’s Elder Economic Security Index, 54% of retirees in our state lack sufficient income to provide for basic necessities
And now families have been hit especially hard by the health and economic crisis created by the coronavirus. More than 1 million New Jerseyans are facing unprecedented job losses, depleted savings, and reduced retirement account balances.
The Homestead Benefit Program provides property tax relief to almost 580,000 low, moderate, and fixed income homeowners. The Senior Freeze program supports approximately 157,000 of New Jersey’s seniors and residents with disabilities. The Senior Freeze has supported the ability for many seniors and residents with disabilities to stay in their homes and communities since 1998, despite the fact that on average, property taxes have doubled over these two decades.
New Jersey’s property tax relief programs can reduce a senior household’s economic insecurity gap by approximately 7%.
For communities of color, the impact of losing these programs could also be severe. These communities have not only been disproportionately impacted by the devastation wrought by the pandemic but would also be disproportionately impacted by the loss of these property tax relief programs as Black and Hispanic homeowners often pay a disproportionately higher rate of property taxes.
Moreover, the sustained gap in homeownership between black and white Americans has been studied and quantified in recent years, particularly because the gap, plays an enormous role in suppressing intergenerational wealth building and economic mobility. Supporting these homeowners through New Jersey’s property tax relief programs will help protect the gains these families have achieved.
Let’s honor our parents, grandparents, aunts and uncles – who have spent lifetimes making a better New Jersey for all of us by preserving their lifelines to their homes and communities. Let’s fully restore the Senior Freeze and Homestead Benefit property tax relief programs.
Assemblywoman Valerie Vainieri Huttle represents the 37th Legislative District.
Stephanie Hunsinger is the state director of AARP.
Melissa Chalker is the executive director of the New Jersey Foundation for Aging.