here was Earl Morgan of the Jersey Journal's take on the elusive Tax Enhancement / Abatement Committee:

No minutes, no votes - they always say 'Yes'
Tuesday, May 22, 2007

'"If tax abatements are supposed to help the city, why are property taxes going up?"

"Where is the affordable housing for working class people and their families?"

These questions and others are being raised by Christine Carmody Arey, the lone civilian on Jersey City's Mayor's Tax Enhancement Committee, commonly, if erroneously, known as the tax abatement committee.

Besides Healy and City Council President Mariano Vega, the other 13 members who participate on the committee are all city department heads. Carmody Arey, a professor at New Jersey City University, was appointed to the committee by former Jersey City Mayor Glenn D. Cunningham when he created the entity nearly six years ago.

Carmody Arey is frustrated by the committee's failure to extract promises from developers to provide more low-income and affordable housing in return for the 20-and 30-year abatements they routinely receive from the city.

Carmody Arey said she is also distressed the developers aren't being pressed to develop apprenticeship programs and provide more jobs for city residents.

The committee's shortcomings are especially gauling to Carmody Arey given the 22 percent property tax increase the property owners who are not enjoying the exemptions were forced to absorb in the past two years.

"I see young families who would like to stay in Jersey City but can't afford it," Carmody Arey said. "When I ask other committee members or developers for the address or office of some central place where people can apply for affordable housing no one can give me an answer."

Carmody Arey said the tax enhancement panel hasn't denied any developer a tax exemptions, though on occasion it has required developers to revamp their application to provide more favorable terms for the city.

Contrast Carmody Arey's complaints with comments Jersey City Mayor Jerramiah Healy made in a recent interview in which he defended his policy to continue granting tax exemptions.

The mayor said the tax committee, on which he serves as an "ex-officio" member, is the initial clearinghouse for proposed tax exemptions.

"Here's what happens," the mayor said, "The committee, made up of some council people and others, make the initial determination if an individual abatement is going to be good for the city. It passes its recommendation on to the entire City Council and then it comes to me."

Yeah, but this thing is not called the Mayor's Tax Enhancement Committee for nothing. Healy is a charter member. It's not some independent body, making objective decisions on the merits of tax exemption applications.

The only City Council member listed is Vega. The four members aside from Carmody Arey and Vega head municipal departments and owe their jobs to the mayor. The directors also serve in "ex-officio" capacity, rarely attending committee meetings. So, they send proxies or designees, members of their staffs, to represent them.

Should you be curious and would like to see the committee at work, lots of luck, since its meetings are not open to the public. However, developers and their lawyers, always know when and where to show up.

The committee keeps no minutes of its meetings, nor do its members actually vote on an exemption application.

When asked, Vega confirmed that instead of a vote, the committee reaches a "consensus" to approve or reject an application for an exemption, making it impossible to hold individual committee members accountable for their decisions.

Jeff I agree with you. The city must eliminate abatements, besides not funding the Board of Ed and the county, abatements are not ratables which means it doesn't add to the ratable base. This is the way the county strikes the citys budget. A quarter of the is invisible in terms of ratables - the higher the ratable base, the lower the taxes are for everyone. By the way, Gerry McCann gave away abatement when he was mayor and lower the abatement agreements that was struck by the previous administration. The lowering of Merrill Lynch from 2% to 1% cost the city $11 million.
Yvonne

5% from PILOTS for the BOE Budget is nothing more than cosmetic eye-candy.

Let's get back to the real core issues -- there are two of them:

1. Abatements distort our tax base, unfairly shifting the real year-on-year tax burden to residential taxpers. Although I don't agree with Mayor Healey's characterization, placing two BoE members on the PILOT panel really accomplishes nothing, and sounds more like a traditional Jersey City "business-as-usual" solution. If anything, it extends the behind the door negotiating process for approval of proposed PILOTs to yet another group of stakeholders. If the BoE budget is to receive a paltry fixed 5% of each PILOT, the need for BoE representation is puzzling at best.

Unfortunately, Jersey City is addicted to the quick fixes PILOT payments contribute to the city general treasury, and this remains as a problem.

2. The school system budget is a financial accident waiting to happen, with a budget that far exceeds Jersey City's. What's wrong with this picture? There are no performance management accountability processes in place to ensure that the monies flowing through the school system budget are efficiently and effectively used. If we truly care about providing our children with quality education into the future, taxpayers are going to have to face the looming budgetary reality.

That 5% certainly isn't going to reduce our property taxes, and that 5% will in no way offset the reductions which are coming with the pending changes in the State's school funding formula for urban schools.

Jersey City has been sheltered from the true cost of running the school system as a result of the many years of state control. The pending return of local control is a fiscal nightmare looming on the horizon.

The time may be fast approaching when we will not be able to afford sheltering abated properties from participating in the year-to-year cost of running our school system.

Forget the 5%, new developments should participate equally in their fair share of school taxes just like the rest of us. Now that would be real abatement reform.

There are perhaps multiple ways to accomplish and implement this result, but what it means is that significantly way more than 5% (or even 10%) of PILOT payments should be flowing through to the school budget. If we don't start doing this soon, the residential taxpayer will bear the brunt of the school system's fiscal inefficiencies when the State gladly hands back the mess to us.

What ever happened to rationalizing or eliminating the distortions the abatement process has created?

Let's get back to real abatement reform.

Over to you Mayor Healy and Councilman Fulop.

All the best.

Geoff Elkind

Quote:


um... 'unauthorized' in what sense? it's a formal referendum - you either vote it up or down, end of story.

...and of course McCann is right, the 'unknown members' thing is yet another false argument.

but his nonsensical desperate arguments against this come as no surprise - the "Tax Enhancement Committee" (don't you just love that name) is the soft white underbelly of the Healy corruption machine, it's where the rubber meets the road in terms of being able to divvy up (largely under the table and with zero transparency) the hijacked PILOT tax income - they'll throw the schools their crumb but the last thing they want is someone looking over their shoulder.

Take that, Eaton College!

Ed board is 8-0 for Fulop $$ plan

Saturday, January 19, 2008

At least one governing body fully backs Jersey City City Councilman Steve Fulop's proposal to use some of the money generated by tax-abated properties to help pay for local schools.

Led by former mayor and current school board member Gerald McCann, the Board of Education endorsed Fulop's proposal Thursday by a vote of 8-0.

"This is a small step toward equal taxation, now it's on the council to take a bigger step," Fulop said.

The City Council gets its first chance to discuss Fulop's resolution at its caucus Tuesday.

It was an easy choice for the school board members, who are confronting a new funding formula that seeks to shift some of the state aid going to poor urban districts to more middle- and working-class communities.

Fulop's resolution calls for tax-abated property owners to pay the schools the equivalent of what they now pay the county - 5 percent - in the "payment in lieu of taxes" paid to the city.

McCann said the problem with Fulop's proposal is that he is asking for too little for schools. So, at his suggestion, the board passed a resolution that calls for schools to get a 10 percent cut of the PILOT.

Fulop's resolution appears to have no opposition.

Mayor Jerramiah Healy has said he's open to supporting it and City Council President Mariano Vega said yesterday he sees no problem with its passage.

A separate resolution could be in for a rougher ride.

Fulop wants the mayor to add two members of the Board of Education to his Tax Enhancement Committee, the group that makes recommendations to the council about abatements.

Healy has called this proposal an "unauthorized grab for power that Steve wishes to delegate to two unknown members of the Board of Education."

McCann shot back: "We'll let the mayor pick the two of us he wants. He knows all of us."

KEN THORBOURNE

I think the point is to allocate the money to the schools directly. I believe the assumption is that once the money goes to City Hall, it is spent and not saved to allocate later.

only 5%?

can the city make direct cash grants to the school system from PILOTs already in place?

Foes agree: Abated? Help fund schools

Thursday, January 17, 2008
By KEN THORBOURNE
JOURNAL STAFF WRITER

Stop the presses. Jersey City Mayor Jerramiah Healy and his all-but-declared challenger, Councilman Steve Fulop, agree the city should be willing to share some of the tax-abatement money it rakes in with local public schools.

But Fulop wants this idea actively pursued, while for the mayor and his team, it's a we'll-do-it-if-we-have-to situation.

Fulop has said he's introducing a resolution next week to "urge the Hudson delegation of the state Legislature to amend the formula that disperses PILOT funds from residential tax abatements."

PILOTs are the payments-in-lieu-of-taxes paid by owners of tax-abated properties. At present, every penny of a PILOT goes to the city and the property owner pays the county an additional 5 percent of the PILOT sum.

Fulop wants 5 percent of the city's PILOT money dedicated to local schools.

"This is a simple, but necessary change that will help our schools while shifting the burden of public school funding from our taxpayers," said Fulop. "The Board of Education needs to be treated as part of the city and not as a second-class citizen."

When asked about the proposal, Healy said he's glad to see Fulop's on board with an idea he had first.

"Our administration has already discussed PILOT revenue allocation for school taxes and we are currently evaluating the full impact this could have for Jersey City," Healy said in an statement.

"But even this plan does not move us off square one," Healy added. "The amount we realize in our municipal coffers is ultimately decreased. . We will not raise taxes, but where will the funds come from when the state cuts our funding?"

Business Administrator Brian O'Reilly said he's mentioned the idea "tongue in cheek" at City Council meetings. But the concept took on an air of seriousness when state Education Commissioner Lucille E. Davy pointed out at a hearing on Gov. Jon Corzine's new school funding formula that the city's tax-abated properties don't pay for schools.

"Since the city's tax abatement policies have a direct effect on our school budget," Fulop is also proposing adding two members of the Board of Education to the mayor's Tax Enhancement Committee, the group of city officials that makes recommendations on tax abatements.

"We think this is an unauthorized grab for power that Steve wishes to delegate to two unknown members of the Board of Education," Healy said.