Lawmakers want to bring ‘senior freeze’ tax relief in from the cold


NJ Spotlight News

Proposed changes to "senior freeze" could mean good news for New Jersey's senior and disabled homeowners.


A state-funded property-tax relief program cherished by thousands of New Jersey seniors may soon get a legislative fix to keep more people enrolled as property tax bills continue to rise across the state.

A measure that easily cleared key committees in both houses of the Legislature would revise the state’s popular “senior freeze” property-tax relief program to make sure those enrolled can remain eligible for benefits even if they move into a new home.

The senior-freeze proposal is advancing at a time when lawmakers from both parties have moved concerns about affordability and the state’s high cost of housing up to the top of the legislative agenda.

It is also follows a series of policy changes in recent years to modernize state property-tax relief programs that have, in many cases, been on the books for several decades.

“This bill will be especially important for our seniors and allow those who move or downsize their homes to have access to this crucial program,” said Assembly Housing Committee Chair Yvonne Lopez (D-Middlesex) during a hearing last week.

“Now, more than ever, we need to find ways to help our seniors,” she said as the senior-freeze bill cleared her committee in a unanimous vote.

Facts on freeze

Established in 1997, the senior-freeze program provides state-funded reimbursement checks to offset, or “freeze,” increases in property taxes once homeowners become eligible for the program in what’s known as their “base year.”

To qualify for the program, which is officially called the Homestead Property Tax Reimbursement, homeowners must be at least 65 years old or have a disability and be at least a 10-year resident of the state. They also must be the owners of their residence for three years, be up to date on their property taxes and have incomes that fall within the program’s limits for the last two years.

According to the state Division of Taxation, the income limits for 2021 and 2020 were set at $94,178 and $92,969, respectively, under current law.

For years, lawmakers used language written into the state budget to keep the income limits flat at $70,000 as a cost-saving measure. But that practice was halted by Gov. Phil Murphy and lawmakers several years ago amid growing concerns about the impact of rising propert- tax bills on New Jersey’s senior citizens.

In all, the average New Jersey property tax bill has grown by more than $4,000 over the past two decades, to a record-high total of $9,284. And last year alone, the average bill increased by $172 in New Jersey, according to data collected by the New Jersey Department of Community Affairs.

Nearly 160,000 homeowners received senior-freeze reimbursements during the 2021 fiscal year, ranging on average from $196 for new recipients to $1,348 for longer-term enrollees, according to budget documents.

Hurry up and wait

Under the senior-freeze program’s current rules, senior and disabled homeowners who currently qualify for the state-funded reimbursements have to wait as long as three years if they move to a new home to once again become eligible for reimbursements.

But the bill that’s currently under consideration in both houses of the Legislature calls for changing the base-year provision so existing senior-freeze enrollees can qualify for reimbursements “immediately following a move to another homestead in New Jersey.”

To do so, a program enrollee who moves to a new home in New Jersey would use as their new base year the “first full tax year prior to the year during which the person resides in the new homestead,” according to the bill.

And if they move into a new construction home, the bill says the base year “shall be deemed to be the first full tax year following completion of the new construction.”

“This legislation will ensure residents reap their financial benefits of this reimbursement program much sooner than current law permits,” said Sen. Fred Madden (D-Gloucester), who is the sponsor of a Senate version of the bill. Madden’s bill has also cleared a Senate committee in a unanimous vote.

It’s unclear how much the proposed policy change would cost the state if more homeowners end up retaining eligibility for senior-freeze reimbursements instead of losing them following a move. A fiscal note for the bill has yet to be drafted by the nonpartisan Office of Legislative Services.

But the push to update the senior freeze program comes as Murphy, a second-term Democrat, is already planning to ramp up overall spending on direct property-tax relief as part of a nearly $49 billion budget he’s proposed for the fiscal year that begins July 1.

In all, Murphy is seeking to increase annual spending on what are known as Homestead benefits from $340 million to just under $900 million. That would allow for an expansion of annual income limits for homeowners, up to $250,000, and to make many renters eligible for benefits for the first time in roughly a decade. And under a rebranding proposal, the expanded Homestead Benefit — which would make nearly 1.8 million homeowners and renters eligible for benefits — would become known as the Anchor program.

For more information about the senior freeze program or to request an application, call 1-800-882-6597. This year’s application deadline is Oct. 31, 2022.

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published this page in News and Politics 2022-06-07 03:32:43 -0700