Grace Period for Property Taxes Remains Unchanged

We are advising our residents that the grace period is unchanged at this moment after reviewing Gov. Murphy’s Executive Order 130.  Gov. Murphy’s order only offered an extension on the tax payment to the municipality, but it didn’t allow for an extension of the liability payments that the Township has to remit to the County, Schools and Fire District. New Jersey statutory law requires that municipalities collect taxes on behalf of all agencies and the municipality is held liable to remit those payments to various agencies even if the municipality does not collect 100% of the taxes due.  The Township only keeps approximately 13% of every dollar collected.  Thus, Franklin Township only receives 13 cents for every dollars taxed on our residents.  The remaining amount is remitted to various agencies that we collect on behalf of. If we extend the grace period, then it will require our Township as well as any other municipality to seek out debt financing to bridge the shortfall in tax collections.  Financing this debt will mean that the Township will incur interest and legal expenses to support the debt.  Those costs would be passed-through to our municipal budget and ultimately further increase our community’s tax rates.