Change in education funding would lower property taxes

Pretend that you are back in high school and the following test was given regarding how to fund primary and secondary education and at the same time lower property taxes.

Here are the facts.

+ The cost of education is funded by 60 percent of property taxes for individual municipalities.

+ The cost of education has risen every year.

+ Residents with lower incomes pay a higher percent of their income than do residents with higher incomes (20 percent vs. 1 percent).

+ Students living in lower-income towns receive lesser educational opportunities than do students in higher-income towns.

+ Many residents cannot afford to pay their high property taxes due to the 60-percent portion going to education.

+ Many municipalities are restricting the construction of homes that may increase the enrollment of students in their schools. The cost of buying and renting homes is increasing due to the curtailing of new-home construction.

+ In 1968 total income for residents in the state was $38 billion, while the cost for education was $1.1 billion. In 2004 the total income for all residents in the state was $385 billion, while the cost for education was $17.5 billion.

Question: How would you reduce property taxes significantly while at the same time fund education without a burdensome tax?

The following is one way of answering the question and is intended to be a "fair-tax" method - a method that follows the principle that taxes should be levied according to one's ability to pay.

+ Dedicate property taxes to only municipal and county costs. This would reduce all property taxes by approximately 60 percent. (A homeowner with a house taxed at $6,000 would save $3,600).

+ Dedicate a 5-percent flat state-income tax to fund only primary and secondary education. (A person earning $50,000 a year would be taxed $2,500).

+ Money collected by the state would be paid back to all school boards with no strings attached. (The amount of money would be based upon a formula developed by the state Board of Education).

+ The formula would exist for three years and would be reviewed at that time for changes, if required.

What answer did you come up with? I wonder if the Assembly representatives have any answers to the problem.

Frank J. Coury

East Brunswick