"Cap" sounds like one of those words I should know, perhaps everyone should know. It's such a commonly used word. But when used by our government when discussing or proposing tax laws, I want to make sure that it's not another one of those legalese terms that proliferate to obfuscate in New Jersey government.
Well, I found that Webster's Dictionary includes 8 definitions of "cap" as a noun. A cap is a "head covering with a brim but not a visor" ... "a natural covering or top" ... "something that serves as a protective covering for a tip, knob, or end, like a dental cap" ... "an overlaying or covering structure" ... "a paper or metal container holding an explosive charge" ... "an upper limit (as on expenditures)" ... "a symbol indicating the intersection of two sets" ... "a cluster of molecules or chemical groups bound to one end or a region of a cell, virus, or molecule". Hm-m-mm-m ...
The "an upper limit (as on expenditures)" definition seems, at first, to be the one intended by the Governor and Legislature for the recently enacted "budget cap" law. But that could be a ruse, the definition some want us taxpayers to accept.
You see, when I carefully examined the actual law, I started to believe more and more strongly that it is a misdirection. In reality, the definition which best applies is "a symbol indicating the intersection of two sets" ... the set who want to show taxpayers they are taking firm action to limit the spending and the set who want to keep spending more and more.
The property tax cap states a limit of 2% to 2-1/2% increase per year and that's the Governor and Legislator's message. "We hear you, taxpayers, so we bit the bullet on spending by passing a hard cap on spending". Sounds like a cap that is "an upper limit (as on expenditures)" defined by Webster's dictionary.
When you read further into the actual legislation you will find that any municipality can vote itself permission to increase their spending as much as 3-1/2% in any year ... and my municipality (Florham Park) does this at the beginning of each year "just in case" as their reason. This does NOT sound to me like a hard cap or upper limit on expenditures. Do you consider this an upper limit?
Then I read even deeper into the legislation and found that only SOME expenditures are to be capped. Wait a minute!! Can you have an upper limit on spending if you only limit SOME spending? And, what about moving budget items you want to increase into line item categories that are not capped? Looks like lots of loophole opportunities. Looks like not so much of the "hard cap" message.
This sounds like a water-proof container that only limits (or contains) the leakage of liquid labelled "water" and the manufacturer of this water-proof container can vote itself permission to allow some leakage when the machines leave little holes or the special coating has gaps in the applications. Hey, wouldn't want those expensive containers to go into the trash!!
Why do we allow any increase total budget? How about a no-increase law ... at least for a few years ... to start reversing the assumption that municipal budgets have to go up at least somewhat?
So, the Governor and Legislators should watch their language!! And, in case they don't, we the taxpayers should watch their language.
By Steve Reichenstein