Category Archives: 2% cap

>Sweeney: Gov. Christie’s tools aren’t the sharpest in the shed

>NJ Senate President Stephen Sweeney has written the following article that appears online this morning on NJ.com. It’s a must read for anyone who thinks that Governor Christie’s “Tool Kit” is the be all, end all solution that will control the rise of property taxes in the state.

Of the 33 bills in the Governor’s “tool kit”, Sweeney rightfully points out that some of them overlapped and were combined to form 24 and later reduced again to by the Governor when he finally realized that proposals about higher education would do nothing to lower property taxes, leaving 20.
Sweeney points out that the Legislature has passed 8 of the 20 bills thus far, the 2% cap on property tax increases and arbitration reform for police and fire contracts being the key pieces passed. While 2 other bills dealing with civil service reform and a cap on sick-leave payouts were passed by the Legislature but vetoed by the Governor. Sweeney then goes on to tell how many of the remaining “tool kit” reforms will do little to bring down property taxes.
So the next time anyone has to hear Republicans in Middletown chastise Democrats in Trenton for not acting on the “tool kit” and saying that these reforms are necessary so that they can control themselves from overspending, I think Sweeney’s article should be read into the record and see what comments, if any Tony Fiore, Gerry Scharfenberger or the others have to say:

The governor has blamed everything and everyone for the highest property tax increase in four years. He continues to state that if only his “tool kit” were passed, New Jersey’s property tax problems would magically disappear.


Closer scrutiny of the governor’s kit proves his claims are false and are merely meant to distract from his own culpability in property tax hikes. The governor cut more than $2.4 billion in funding to schools and municipalities last year. That is why your taxes are going up. The tool kit will not make up that shortfall.

There are reforms that must be implemented, such as pension and health benefits reforms, which I have supported since 2006. I am committed to getting those done. But those reforms are not — and never were — part of the governor’s proposed tool kit.

First, let’s have truth in numbers. The governor started by saying there were 33 bills in the tool kit. Actually, there were 24 after items were combined. Now the governor says there are 20, because he finally realized that four proposals dealing with issues at colleges and universities have absolutely nothing to do with property taxes.

The Legislature did pass eight tool-kit items. First was the creation of the 2 percent cap on annual property tax increases, which the Legislature lowered from the 2.5 percent cap the governor initially proposed. Second was arbitration reform for police and fire contracts, which was heralded across the state by local officials as key to reining in property taxes.

Two others — comprehensive civil service reform and a cap on sick-leave payouts for public employees upon retirement — were passed and sent to the governor, who vetoed them. We have no reform in these two areas because the governor chose to kill reform.

Civil service needs to be reformed and modernized, but abolishing it will not lower property taxes. Only one-third of New Jersey towns are bound by civil service rules, and those towns actually have lower property taxes per capita than towns without civil service. Civil service was established to protect against political corruption and nepotism. It is puzzling that the governor wants to completely eliminate this protection.

Sick-leave payouts should be capped, but the governor vetoed a bill to do that because he wants to take away benefits workers have already earned. That may be a nice talking point, but it won’t stand up in court. And it would create a flood of new retirements as workers cash out before the law would take effect. If the governor got his way, this tool would actually cost taxpayers even more.

Two other parts of the tool kit are already in comprehensive shared services legislation I am sponsoring with Assemblywoman Pamela Lampitt and Assemblyman Paul Moriarty, which goes far beyond what the governor envisioned, and which will move through the Legislature later this spring.

These are the only parts of the tool kit that will save you money on your property tax bill. We did them. The handful of remaining bills that the governor clings to won’t save you anything.
One would cap spending on state government operations — which already exists under law, and even if it did not, would have no impact on local property taxes. Another would allow local governments to use furloughs to save money — which they already can do as long as furloughs are negotiated.

Another bill to centralize all power over civil service decisions in the Civil Service Commissioner (read: czar) would only consolidate the governor’s power and do nothing to lower property taxes.

One bill would move school and fire commission elections to November — a move whose total property tax savings, according to the nonpartisan Office of Legislative Service, would be “minimal.”

Others would change the way some employee discipline measures are handled (OLS estimated savings: $140,000), require the mailing of only one sample ballot per household (OLS estimated savings: $1.4 million), and allow municipalities to offset property tax delinquencies against state income tax refunds (OLS estimated net savings: zero).

The governor’s rhetoric does not stand up to simple math. The tool-kit bills that haven’t yet been passed offer no real help from New Jersey’s crushing $25 billion property tax burden.

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Filed under 2% cap, arbitration reform, civil service, Gov. Chris Christie, NJ State Senate, NJ.com, property taxes, Stephen Sweeney, tax saving tool, toolkit

>Let The Spin Begin: Press Release In Advance Of Budget Introduction Issued By Middletown Committee

>

In advance of tonights budget introduction by the Middletown Township Committee, the follwoing press release was issued a short while ago, all I can say is let the spinning begin. It seems that only in Middletown can the municipal budget be cut by nearly $4 million but the amount need to be raise through taxation increases by $1.58million. I guess I should be glad though, could you imagine what the tax increase could have been if the Township Committee didn’t adhere to the Governor’s mandate to stay under the 2% cap?…

MIDDLETOWN – The Middletown Township Committee anticipates introducing its 2011 municipal budget that is $3.87 million (5.9%) less than the Township’s 2010 budget.

“Middletown’s proposed municipal budget is very austere and in full conformance with the new 2% cap levy law despite the Legislature’s continued failure to enact the Governor’s tool kit reforms that would empower the Township to make further cuts,” said Middletown Mayor Tony Fiore.

“We are hopeful to continue to rein in spending through ongoing negotiations with the Township’s collective bargaining units with a focus on decreasing the Township’s health care costs.” “Cuts in the proposed budget include the layoffs of 26 employees, including 10 police officers, and the third consecutive year of salary freezes for the Township’s managerial employees,” continued Fiore.

“Middletown will continue to focus on core governmental functions while seeking other ways to continue to reduce costs though interlocal agreements and the Township’s solar initiative that is currently under way.”

Proposed Budget Data and Facts

  • The proposed 2011 municipal budget is $61,114,285 compared to the adopted 2010 budget that was $64,979,576.
  • The proposed budget represents an actual decrease in spending of $3,865,291 (5.9%) from the 2010 budget.
  • The largest cost drivers offsetting the Township’s $3.87 million in budget cuts are tax appeal refunds, State-mandated pension contribution increases of 22%, and costs associated with deferred charges due to numerous retirements last year.
  • The proposed 2011 budget anticipates an increase in the total tax levy of $1,357,855 which complies with the new 2% cap levy law and will cost the average Middletown homeowner approximately $5 per month.
  • The municipal budget makes up only approximately 22% of the average property tax bill, the remaining portion relates to the school and county tax levies.

20 Comments

Filed under 2% cap, budget introduction, Governor Christie, Middletown Township Committee, press release, Spin, Tony Fiore

>Middletown Board Of Education Approves $144 Million Funding Plan

>At last night’s Middletown Board of Education meeting, the school board approved a $144 million dollar spending plan for fY 2011-2012, that will be presented to voters on April 27th.

According to the Asbury Park Press’s article, the spending plan seems reasonable and I see no reason for voters to reject it. The budget will increase by 1.38% which is well below Governor Christie’s 2% cap on budget spending.
This budget will provide for the hiring of additional teachers this year, which will help to alleviate classroom overcrowding in a few of the districts school.
I was not at last night’s meeting but from what I was told, a few who were in attendance questioned the leanness of the budget and whether or not the school board left enough wiggle room within it in case it was rejected by voters, as it was last year.
I was told that the response to this questions was that the budget was purposely put together lean in an attempt to show residents and the Township Committee that this budget, unlike previous one, was honest and reflective of the times. And if the budget was rejected, it would be devastating to the district.
The main thing that I am curious about, is how contract negotiations with the teacher’s union is going. unlike in years past, these talks have been relatively quite but still unresolved over issues concerning healthcare contributions. So I wonder how the Board of Education can produce and honest, lean budget without a signed contract with the teachers?

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Filed under 2% cap, Asbury Park Press, blogging, Middletown Board of Education, Middletown Township Committee, school budgets, teacher contracts

>Ringing Controversy; Concerned Citizens of Middletown Robocalls Strike A Nerve

>It seems that the latest round of Robocalls that went out yesterday afternoon by the group calling themselves “Concerned Residents of Middletown” have struck a nerve with some sitting on the Township Committee who say that the calls don’t ring true.

In a column published this morning over at Redbankgreen.com, Middletown Mayor Tony Fiore and his Deputy Mayor Pam Brightbill question the legitimacy of the group Concerned Residents of Middletown and it’s message.

It appears to be just another desperate attempt by the Middletown Democrats to spread misinformation to the taxpayers,” Fiore is quoted as saying in reference to who he thinks is behind the calls. He adds “the real truth will come out. The information they’re pointing out is just not accurate,” when referencing that the Townships budget will be introduced next week.

As if that has any real barring on the truthfulness of the messages contained in the robocalls. Remember last year how Mayor Scharfenberger and those sitting on the Committee, other than Democrat Sean Byrnes, insisted that the Township tax increase was only 2.8% when the proposed budget for 2010 was introduced in last June, when in actuality the municipal tax rate increased by 13.9%.
I think the people lacking credibility on budget issues are those that sit on the Township Committee. The real truth behind the budget numbers and any proposed tax increase which will be presented next Monday night, wont really be known until revised tax bills are sent out to residents, after the budget is adopted later in the year, just as it was last year. When residents looked at their tax statements expecting to see only an increase of 2.8% in the municipal rate, they were stunned by the difference.
Before passing judgment on these robocalls, it is important to see if the message included in them pan out as describe. Only then can we tell who was spreading false information to residents.

12 Comments

Filed under 2% cap, Concerned Citizens of Middletown, Middletown Township, Pamela Brightbill, proposed budget, RedBankGreen.com, Robo-calls, tax increase, Tony Fiore

>N.J. municipalities scramble to notify voters on property tax referendum; I wonder if Middletown has plans to hedge it’s bet

>According to the Star-Ledger, today is the last day that municipalities around the State have to notifiy their votes of the potential to hold a property tax referendum that would enable a municipality to exceed Governor Christie’s 2% cap on budgets.

I posted Saturday about how Middletown’s Administrator Tony Mercantante and others have stated that they had no intention to exceed the 2% cap and that there would be no referendum needed, especially since Mercantante had no idea how a referendum would work. He stated at the February 16th Library Board meeting that the State Legislature(code word for Democrats) in its bill, provided no guidance or allocated any type of funds to municipalities for the purpose of such an event. So Middletown wasn’t going to even consider such a possibility.

Instead of planning for the possiblility of a referendum, Middletown’s Mayor Tony Fiore, and others that control the town planned to follow Governor Christie’s lead and stay with in a 2% budget increase.

That sounds great in theory but wouldn’t be a good idea to hedge your bets and announce a referendum just in case they can’t stay with in the cap?

Is the Township Committee really prepared to lay off 10 or more police officers and the whole department of Parks & Recreation if they can not get union consessions during contract talks or if they Library Board refuses to hand over any more reserved funds then they are legally responsible to do, which at this point is in the neighborhood of $250,000?

I guess these questions will be answered at tonight’s Township workshop meeting.

TRENTON — New Jersey enters a new era today as voters get to find out if they may be asked next month to raise their property taxes beyond the Christie administration’s new 2 percent limit.

Under the law signed by Gov. Chris Christie last summer, residents will decide if their town or school budget can exceed the 2 percent cap through a referendum on April 27, the same day as school board elections.

Towns and schools were scrambling last week to meet today’s deadline to publish a newspaper ad notifying voters a referendum may be held. As of Sunday, five towns — Plumsted, Mount Holly, Riverdale, North Arlington and Chesilhurst — had placed ads and at least five more towns and two schools planned to, according to groups representing towns and schools….Read more >>> Here

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Filed under 2% cap, budget deficit, budget surplus, Middletown, Middletown Library, property tax referendum, the Star-Ledger

>Can Someone From Middletown Call Someone From Brick To find Out How A Special Budget Referendum Is Supposed To Work?

>During the February 16th Library Board meeting, someone asked about the possibility of Middletown exceeding the new State mandated 2% cap on budgets and the possibility of placing a budget referendum question on the ballot that would allow voters to authorize exceeding the cap if they thought it was necessary to retain services.

The question was answered by Township Administrator Tony Mercantante and the goon that acts as Township Attorney Brian Neslon. They answered that Middletown had no intention whatsoever in exceed the 2% cap and even if they did there was no mechanism in place that they knew of, that would guide them towards how a special budget referendum would be putting place or carried out.

Mercantante stated something to the fact that, like most of what the law makers in Trenton do, they passed a provision with no guidance on how to carry it out or how to finance it. Mercantante and Nelson were both adamant that Middletown was not going to spend one dime to carry out a special election just so that voters can approve or disapprove a proposed budget, without funding from the State.

Fast forward now to Wednesday when it was reported in the Asbury Park Press that Township of Brick is planning to hold a special budget referendum to exceed the State mandated 2% cap. At stake are the jobs 172 employees that would include 29 police officers and 117 members o the public works department.

Now the article didn’t mention when or how the special budget question was going to happen, but it is a good bet that the question will be posted on the ballot of the next set of elections coming up, which would be the school board election in April.
Contrary to popular beliefs in Middletown, it doesn’t take a rocket scientist to figure this stuff out. I believe this is why Governor Christie and those in the State Legislature have told municipal leaders that their budgets need to be submitted to the State by mid March, so if there is a need for a special referendum it could be without the need for a special election or any extra costs associated with it.
It would just be nice to get a straight answer out of people that represent Middletown for a change, without it being turned into a big political name calling game.
So can someone from Mercantante’s office call down to Brick and ask someone in the Mayor’s office down there, the details on how a special election would work to exceed the budget cap if ever needed?

6 Comments

Filed under 2% cap, Brian Nelson, Brick NJ, budget referendum, Middletown, special election, Tony Mercantante

>Looking At Both Sides

>by guest blogger Sean F. Byrnes, former Middletown Township Committeeman

Last week we saw the Township of Middletown enveloped in a dispute over the Township’s effort to convince the Board of Trustees for the Library to turn over a significant share of its surplus to the Township Committee for budget relief purposes. Unfortunately, the manner in which the township chose to solicit these funds lacked tact. Although the township had previously made less threatening overtures to the Library in an effort to win the Board of Trustees’ support for a funds transfer, when that effort failed, the Township pursued an aggressive campaign to convince the public that a transfer would be in their best interest. Spearheaded by new Committeeman Kevin Settembrino, this effort, whether intended or not, seemed rooted in tactics of intimidation and threats to de-municipalize the library and combine it with the County Library system. This effort also suggested that a failure of the Board of Trustees to abide by the wishes of the Township Committee would result in the loss of ten police officers, the layoff of a significant number of Township employees and, if you heard the comments at the Library Board of Trustees’ meeting, an effort by Township Committee members to replace existing Board of Trustees members.

Based on the comments from Board of Trustees’ members at their meeting on Tuesday, it would appear that the resolve of the Board of Trustees has not wilted in the face of these threats. Led by Randy Gabrielan, the Chairman of the Board, the Library challenged the assumptions, numbers and legal authority for the Township’s demand for a funds transfer. Looking ahead, as a Township resident, I would hope that both sides could retreat from the current level of heated rhetoric and restart their discussions.

I think it would be in the interest of all taxpayers for the Township Committee and Library to continue their discussions. It might make more sense to have the Township Administrator meet with the Director of the Library to discuss how the Library might be able to assist the township in this time of budget crisis. From the Library’s perspective, the Board has worked hard to build a reserve that could be used for future capital projects, and there is an understandable reluctance to use these funds to satisfy operating expenses for the Township. From the Township’s perspective, the Library has a protected stream of revenue that is not subject to the same stresses and demands that the Township must face when health care costs increase, pensions become more expensive and the cost of doing business generally continues to go up. There may be opportunities for these two parties to cooperate in other ways that would provide relief to the Township without exhausting the reserves of the library.

There is no question that the Township finds itself in a perfect storm of budgetary constraints. To be fair, some of these strains are beyond its control. But the Township moved at a glacial pace over the last several years as this financial crisis approached. A quicker response to the approaching financial storm would have made the Library ask a smaller one. Accordingly, before the Library turns over any of its reserves to the Township, it would be nice to see an acknowledgment that a swifter response from the township in 2009 and 2010 would have avoided the seriousness of the budget crisis that the Township currently faces. The Township did lay off approximately 16 employees last year, but did so only mid-year. Other municipalities took action much sooner and in more dramatic fashion. The former Mayor’s claims of 40 layoffs include retirements.

Other cost-saving measures were proposed over the last several years, but were rejected as too extreme. Unfortunately, as a result of the Township’s failure to act, the Township Committee must now contemplate cuts that go far beyond those that were previously considered “extreme.” Until the Township forms a subcommittee whose function is to focus on budget recommendations, track existing and anticipated debt, look for opportunities for consolidation and sharing of services and generally manage the Township’s finances on a more regular basis, the Township will always be reacting to rather than planning for increased demands for Township resources.

Once again, in fairness, the unfortunate timing of the Township’s reevaluation in 2009, just prior to a steep decrease in property values, set the Township up for a tax appeal nightmare in 2010 and 2011. (Of course, the township had mistakenly put off its reevaluation for approximately 14 years – had the township completed the reval when it should have, the steep drop in real estate prices would not have resulted in such a large number of tax appeals.) But regardless of the failure to conduct a timely revaluation, the Township has a legitimate reason to gripe, because when a resident or commercial property owner prevails on their tax appeal, the township must return to the taxpayer not only the municipal share of the taxes received from the taxpayer, but must also reimburse the taxpayer for the funds received by the School District during the year for which the tax appeal was filed. This reality is difficulty for some to believe, but true. And, in light of the fact that approximately two-thirds of the tax dollars go to school district activities, the Township ends up paying back the taxpayer for School District funds that the Township never received in its budget.

Consequently, the steady decrease in real estate value over the last couple of years has produced a field day for those filing tax appeals. The Township is now struggling to repay multi-year tax appeals that are probably worth nearly $4 million. Unfortunately, the Legislature has failed to assist municipalities facing this dilemma. Under the circumstances, given the unique circumstances facing municipalities, including picking up the tab for the Legislature’s bungling of pension contributions for public workers, the Legislature should provide assistance to townships by creating opportunities for public entities to finance the tax appeals or extend their repayment terms. In several years, the Township will be through this unique period where tax appeal refunds are substantial and hopefully return to a more predictable budget cycle. The Township Committee took the first step in this direction in 2010 when it decided to conduct a reassessment. Even thought the reassessment cost $400,000 the savings achieved in 2011 from reduced tax appeal filings will be far greater.

The realities of the tax appeals as set forth above increase the pressure for some agreement with the Library. At the same time, the Library will see its share of funding decrease by more than 10 percent next year, due to the fact that its revenue stream is dependent solely upon property values. With a 1.3 billion drop in the total assessed real estate in the Township of Middletown, the Library’s stream of revenue will be reduced considerably. Given this dynamic, it may make sense for the Township and Library to discuss mutual relief. In other words, the Township needs money now most desperately. The Library in the out years may need assistance as its funding stream declines. Perhaps assistance from the Library during the current year could be received in exchange for promises by the Township to return the favor several years down the road.

It might also make sense for the Library to consider some sort of partnership with the Arts Center. While the Arts Center has its own Board of Directors, this arrangement, as far as I know, is not routed in any legislative scheme. Indeed, the Township has effectively turned over the operation of the Arts Center to a non-profit corporation and the Board supervises these activities. Resident Jim Grenafege was the first person to suggest that the Library Board of Trustees might consider assimilating some of the Arts Center’s operations into its activities. A casual review of the websites for these two entities suggests that there is some degree of overlap between the artistic and cultural offerings from these two bodies. Given that they both have buildings that are relatively new and both are focused on improving the education of the citizens of this Township when it comes to arts, literature and music, there may be some opportunity for the Library to assist in the operation of the Arts Center, including some of its expenses. It is exciting to contemplate what the far larger Library work force might be able to provide to the Arts Center when it comes to running the day to day events and offerings at the Arts Center.

At the end of the day, the current legislation when it comes to Library transfer to municipalities, amended in October of 2010, will likely allow some transfer to take place. From the Township’s perspective, the amount of money to be transferred under the current legislative scheme will fall short of what the Township needs to avoid drastic reductions in personnel and services. However, somewhere within the circumstances discussed above, creative minds on both sides should be able to work out an arrangement that provides some additional relief for the Township, even if it may not be a direct transfer of funds of the magnitude the Township seeks. My hope would be that the time and energy on both sides be spent working toward that goal, rather than on blaming the other.

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Filed under 2% cap, budget deficit, budget surplus, Middletown Cultural Arts Center, Middletown Library, Middletown Township Committee, Sean F. Byrnes, tax appeals