-->

Wednesday, April 6, 2011

Maplewood Passes Budget with Zero % Tax Increase

Maplewood Passes Budget with Zero Percent Tax Increase

The average home owner will experience a 0% tax increase for 2011 despite the fact that the amount to be raised by taxation has grown by more than $300,000 over 2010.
Section Sponsored By
The Maplewood Township Committee passed a 2011 municipal budget that will not raise taxes over 2010 rates for the average residential property owner.
At a budget meeting on March 4, the Committee had instructed Township Admnistrator Joseph Manning and staff to introduce a budget at a 0% tax increase. It was an aggressive move that went beyond the state-mandated 2% tax cap, but one that elected officials felt was necessary during a time of financial difficulty for many residents.
At the March 4 meeting Deputy Mayor Fred Profeta had stated, "We have to give people a break," citing the "perfect storm" in which residents are faced with the "worst economy" in decades and "the people hit the hardest live in the least affluent part of Maplewood, and those are the parts of Maplewood that took the biggest hit with the reval."
Profeta was referring to the 2010 state-mandated property revaluation that resulted in projected property tax decreases in more affluent areas on the western side of town, while generating projected increases for many properties in lower-income areas of town bordering Union and Irvington — a partial reversal of the 2000 trend that saw much more dramatic shifts in values.
However, the Township Committee rejected the budget for introduction at its March 15 meeting because elected officials felt it was unclear that the budget was at a 0% tax increase. Committee members noted that it was difficult to ascertain whether or not the tax rate was changing due to the change in property values after the revaluation. Elected officials asked that township auditor Joseph Faccone be contacted to answer questions and verify the numbers — and appear at the April 5 meeting.
On Tuesday, April 5, Manning presented the Township Committee with three budget scenarios — with Faccone in tow. The only difference between the three was the amount of surplus to be used to reduce the amount to be raised by taxation, explained Finance Chair Jerry Ryan. The scenarios were all aggressive. One used $1,200,000 in surplus to generate a tax decrease of -0.34% for the average home owner. Another used $1,414,833 in surplus for a decrease of -1.15% for the average home owner.
The one approved by the Township Committee, however, was the scenario that was endorsed by Manning: $1,111,000 from surplus would be applied to the budget to bring in a 0% tax increase for the average home owner.  The approved Maplewood municipal budget for 2011 is $38,044,067 with $26,401,194.13 to be raised by taxation.
It was the best scenario of the three according to Manning who raised concerns at previous meetings that depleting the surplus would leave the township poorly positioned to balance future budgets.
Committeeperson Marlon K. Brownlee noted that there had been a shift in the balance of residential versus commercial properties since 2010. One additional commerical property had been added to the tax rolls, while there were three less residential properties. Overall, while residential properties made up 89.695% of the ratable base in 2010, they constituted 87.022% in 2011. This allowed for a 0% change in the tax rate for residential properties despite the fact that the amount to be raised by taxes in 2011 is $303,832.13 more than in 2010.
Profeta asked Faccone to verify that this would mean a slight increase for commercial properties. Faccone confirmed that all three scenarios resulted in an increased rate for commercial properties. Mayor Vic DeLuca said this was a reversal of the 2000 revaluation when residential properties had taken on a greater share of the ratable base.
When it came down to a vote, all Committee members supported the 0% residential tax increase scenario. "We really should be thinking ahead. I can understand your recommendation for scenario number 3," Vice Mayor Kathleen Leventhal told Manning. "I like it."
Although municipal taxes will increase 0% for the average home owner, municipal taxes represent only about 28-30% of your local tax bill. The blended taxy levy increase for the school district for 2011 is 2.85% for Maplewood (approved on March 30 by the Board of School Estimate). The school tax represents about 58-60% of your local tax bill. The exact amount of the Essex County tax increase is not yet known (that's about 14% of your tax bill), but there will be an increase. Although County Executive Joseph N. DiVincenzo said that the county tax increase will be the third lowest amount statewide in the last eight years, the county tax rate has increased by 3.16 percent on average over the last nine years.

No comments:

Post a Comment