JERSEY CITY LIST - Re: Republican state senator slams Jersey City on tax abatements [Politics & Government]

Re: Republican state senator slams Jersey City on tax abatements

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The abbot district has nothing to do with tax abatements. JC receive abbot money based on the income level of JC residents based on data from the 1980s.

Posted on: 2015/8/7 23:05

Re: Republican state senator slams Jersey City on tax abatements

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Quote:

Yvonne wrote:
I have contacted the city clerks offices from Edgewater, (not Hudson County) to North Bergen, Guttenberg and Weehawken to inquire about their tax abatement policies. Those towns do not receive state funding to their schools so there is a limit on tax abatements. It is not handed out like JC.

Can you explain this more? Are you saying that because we are an Abbott district that it allows Jersey City to give out more tax abatements than other communities? Interesting...

Posted on: 2015/8/7 21:40

Re: Republican state senator slams Jersey City on tax abatements

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I have contacted the city clerks offices from Edgewater, (not Hudson County) to North Bergen, Guttenberg and Weehawken to inquire about their tax abatement policies. Those towns do not receive state funding to their schools so there is a limit on tax abatements. It is not handed out like JC. Even the former mayor of Bayonne was pushing tax abatements and he did not win re-election. Bayonne knocked down a tax abatement recently. Bayonne residents do not want the traffic and congestion of http://hudsonreporter.com/view/full_s ... instance=search_resultsJC.

Posted on: 2015/8/7 18:30

Re: Republican state senator slams Jersey City on tax abatements

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Development happens in other North Hudson town along their waterfront without 30 tax abatements. I speak because I want it on record.

Jersey City currently has several thousand apartments in various phases construction along the waterfront. Show me another town in North Jersey growing at the same pace and successfully transformed former industrial wastelands into vibrant communities. You can't because it doesn't exist.

Posted on: 2015/8/7 18:08

user1111

Re: Republican state senator slams Jersey City on tax abatements

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Quote:

Yvonne wrote:
Development happens in other North Hudson town along their waterfront without 30 tax abatements. I speak because I want it on record.

Some of us thank you!!!

Posted on: 2015/8/7 17:50

http://googleitbitch.com/

Re: Republican state senator slams Jersey City on tax abatements

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I am being shot down because of the relationship between developers and the mayor. Did you see the debate last night? What did Trump say? I contributes to campaigns because he wants favors. Who do you think buy those $2,500 political dinners? Development happens in other North Hudson town along their waterfront without 30 tax abatements. I speak because I want it on record.

Posted on: 2015/8/7 17:48

Re: Republican state senator slams Jersey City on tax abatements

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Yvonne wrote:
I agree JCGuys, taxes would have increased because our payment to the board of ed went up an extra $40 million since 2005. But in 1988, you only had the first 4 buildings in Newport plus the mall. All the other development downtown which now have abatements did not exist. I have always said, abatements are contracts and not ratables, only ratables are used by the County to figure the tax rate.

Instead of showing up at every public meeting and speaking out against abatements (and being shot down every single time), it's a pity you don't show up and vigorously support new developments that will add to the ratable base, and if an abatement is necessary, advocate for the shortest term possible so that it may be added quickly to the tax rolls.

Wish you used your energy to be an agent of growing the ratable base by encouraging new development that will in turn generate more in taxes than it will cost the city or school district to service them. For example, the new 'luxury' towers going up around town that will cater to 20 and 30 somethings at $2500+ a month rent aren't likely to be sending kids (if they even have any) to the public schools. Taxes collected on these buildings will subsidize the rest of the city, resulting in a lower tax burden for us all.

Instead, you just narrowly focus on the tax loss to Hudson county and school board from abatement and miss the big picture.

(The city gets roughly the same amount of money from PILOTS than it would from an unabated property. In a way we're shafting the school board and county and keeping 90% of the PILOT monies for ourselves.)

Posted on: 2015/8/7 17:40

Re: Republican state senator slams Jersey City on tax abatements

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I agree JCGuys, taxes would have increased because our payment to the board of ed went up an extra $40 million since 2005. But in 1988, you only had the first 4 buildings in Newport plus the mall. All the other development downtown which now have abatements did not exist. I have always said, abatements are contracts and not ratables, only ratables are used by the County to figure the tax rate.

Posted on: 2015/8/7 17:00

Re: Republican state senator slams Jersey City on tax abatements

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Quote:

Yvonne wrote:
It is amazing how Secaucus and other town in North Hudson did development without 30 years tax abatements. By comparison Secaucus has a low tax rate. With all this development our taxes increased from $30.52 to nearly $75.00 after reval. If abatements were great, our taxes should have not increased. In 1988, after reval, you paid $3,000 to JC if assessed at $100,00, now you are paying $7,500. JC did not have the buildings in 1988 as it does now. Tax abatements was sold as a way to stabilize our taxes. The reversed has happened. These abatements were contracts, not added to the ratable base and our taxes rose.

http://www.state.nj.us/treasury/taxation/pdf/lpt/gtr14hud.pdf

In Hudson, the biggest beneficiaries of abatements have been those on the waterfront - Weehawken, Hoboken and JC - and that shows in effective tax rates. Secaucus has benefited by turning itself into a huge shopping mall, and kick-backs for not developing on their wetlands. Secaucus's effective tax rate is 2%, JC's is 2.3%. Hardly a sizeable difference.

Without abatements, JC could easily be paying an effective tax rate of ~3.3% like Union City - a 50% hike in taxes. Are you prepared to roll the dice on that? I'm not.

The sad fact is that some folks buy into your financial illiteracy - and you are likely to be the cause of increased taxes in JC and reduced development. If abatements are pulled and our taxes increase - we'll know exactly who to blame.

Posted on: 2015/8/7 14:38

DanL

Re: Republican state senator slams Jersey City on tax abatements

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its not a simple yes or no answer. there is always the what if question (what if the abatement was not granted.)

but most people who are not current elected officials and are not developers seem to feel that there needs to be meaningful adjustments and the current approach cannot continue. areas (ie. downtown) that have seen substantial redevelopment should require less governmental involvement and that involvement (redevelopment plans and tax abatements) should be of shorter duration.

the reality is that nothing has changed with administrations. what was bad one day does not become good the next.

Posted on: 2015/8/7 14:31

Re: Republican state senator slams Jersey City on tax abatements

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Quote:

Yvonne wrote:
It is amazing how Secaucus and other town in North Hudson did development without 30 years tax abatements. By comparison Secaucus has a low tax rate. With all this development our taxes increased from $30.52 to nearly $75.00 after reval. If abatements were great, our taxes should have not increased. In 1988, after reval, you paid $3,000 to JC if assessed at $100,00, now you are paying $7,500. JC did not have the buildings in 1988 as it does now. Tax abatements was sold as a way to stabilize our taxes. The reversed has happened. These abatements were contracts, not added to the ratable base and our taxes rose.

Even if we still saw the same level of development with no abatements (a situation I do not believe is possible), and we collected the full taxes rather than just the PILOT payments, taxes would have still risen, Yvonne. I'll let someone more experienced due to calculation of how much taxes would have been, but I doubt it's a major difference than what they are currently.

Also something to consider is that Jersey City probably charges enough in PILOTs to cover the city portion of the tax bill, meaning any increase in taxes would go to the school board and Hudson County. If our school finances were doing better than they are now, the state may have reduced Abbott funding, so I'm not convinced that school board taxes would have been lower had there been no abatements.

I would laugh if this theory could somehow be tested with a resulting conclusion that a Jersey City without abatements has even higher property taxes than exists now. Because the city lost out on PILOT payments and many development sites remained vacant industrial wastelands rather than being developed. It could be like 'A Christmas Carol' except with Yvonne in the staring role being visited by the Ghosts of Jersey City Past, Present, and Future showing a world without new development and abatements. It's not too late to see the error in your ways, Yvonne!! Haha :)

Posted on: 2015/8/7 13:50

Re: Republican state senator slams Jersey City on tax abatements

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It is amazing how Secaucus and other town in North Hudson did development without 30 years tax abatements. By comparison Secaucus has a low tax rate. With all this development our taxes increased from $30.52 to nearly $75.00 after reval. If abatements were great, our taxes should have not increased. In 1988, after reval, you paid $3,000 to JC if assessed at $100,00, now you are paying $7,500. JC did not have the buildings in 1988 as it does now. Tax abatements was sold as a way to stabilize our taxes. The reversed has happened. These abatements were contracts, not added to the ratable base and our taxes rose.

Posted on: 2015/8/7 13:35

Re: Republican state senator slams Jersey City on tax abatements

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Quote:

Sommerman wrote:
Quote:

dtjcview wrote:

Quote:

MidwestTransplant wrote:
Slightly off-topic, but is there a calculator or a back-of-the-envelope calculation that could be used to determine what property taxes might look like after a property reval? I can't decide how to think about the issue without figuring out how it will affect me first. :)

Simplest ballpark - go to Trulia or Zillow and get a current estimate of value. Multiple by JC's effective tax rate (2.3% in 2014). So a $100k home would pay $2.3k. A $1m home $23k.

http://www.state.nj.us/treasury/taxation/pdf/lpt/gtr14hud.pdf

Don't you need to do this for every property in JC and then calculate a new tax rate? Let's say that JC is currently valued at one billion and revalued at five billion. The current tax rate must be divided by 5, assuming the budget stays the same, before you can calculate new taxes for an individual property.

No. What you are describing is the equalization rate - the difference between value assessed in JC in 1988 and current market value. In JC, average assessed value= 30.02% of current value. Every single JC property is assessed using the 1988 baseline.

In this link. Total JC assessed value=column 1, actual value= col 3. Equalization rate col 2.

http://www.state.nj.us/treasury/taxat ... l/2014/2014TEV_hudson.pdf

The reval may change the number in column 3 - and that might change the effective tax rate fractionally. But not by much - unless the estimate in col 3 is badly wrong.

Posted on: 2015/8/7 12:42

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Re: Republican state senator slams Jersey City on tax abatements

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Quote:

dtjcview wrote:

Quote:

MidwestTransplant wrote:
Slightly off-topic, but is there a calculator or a back-of-the-envelope calculation that could be used to determine what property taxes might look like after a property reval? I can't decide how to think about the issue without figuring out how it will affect me first. :)

Simplest ballpark - go to Trulia or Zillow and get a current estimate of value. Multiple by JC's effective tax rate (2.3% in 2014). So a $100k home would pay $2.3k. A $1m home $23k.

http://www.state.nj.us/treasury/taxation/pdf/lpt/gtr14hud.pdf

Don't you need to do this for every property in JC and then calculate a new tax rate? Let's say that JC is currently valued at one billion and revalued at five billion. The current tax rate must be divided by 5, assuming the budget stays the same, before you can calculate new taxes for an individual property.

Posted on: 2015/8/7 11:48

Re: Republican state senator slams Jersey City on tax abatements

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Two key points on city-issued abatements:
1. Not issuing them is a huge gamble. Would you take $120m, or gamble for the full $200m and risk getting nothing?
2. Devs can haul the city's ass into court on precedent: prior abatements, "builders remedy"....

1. Is a coin toss. Yvonne assumes we win that "lottery". I'd take a guaranteed 60% every time over the risk of a 0 or 100% coin toss. Taking that 60% is called winning.
2. Can be remedied by clear state policy and legislation. Here's the zip codes that can get PILOTS - here's the zips that can't.

Posted on: 2015/8/7 9:13

Re: Republican state senator slams Jersey City on tax abatements

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Monroe wrote:
I wouldn't worry a bit about Abbott being overturned, especially given that we'll likely have a Democratic Governor and Legislature in Trenton. Reval? Yup, but it's a wash-some people will pay more, and some will pay less.

Yes. Jersey City isn't about to lose Abbott funding. Worst case scenario: JC hikes property taxes ~12% under Ciattarelli's 25% minimum proposal - $112 to 167k increase in JC Schools contribution. Not great, but we've seen worse in the Healy years.

Ciattarelli's plan to make abatements dependent on 50% local school funding won't happen simply because it will kill abatements in every inner city area where they're needed most - in JC's case - areas outside downtown.

http://jclist.com/modules/newbb/viewtopic.php?post_id=384416
http://politickernj.com/2015/07/gop-a ... elli-targets-jersey-city/

Posted on: 2015/8/7 8:39

Monroe

Re: Republican state senator slams Jersey City on tax abatements

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I wouldn't worry a bit about Abbott being overturned, especially given that we'll likely have a Democratic Governor and Legislature in Trenton. Reval? Yup, but it's a wash-some people will pay more, and some will pay less.

Posted on: 2015/8/6 22:11

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Re: Republican state senator slams Jersey City on tax abatements

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jmcee wrote:
Quote:

I think you'd be crazy to buy at current prices when there's a real threat your property tax bill might double or triple in the next 5 or so years. Meaning once the reval goes through (Ward E) and if JC loses its Abbott district status (everyone).

Hoboken survived a major tax hike and a reval in the last 5 years. Prices and demand remain strong. I know it not an apples to apples comparison but it's food for thought. Long time residents in single family homes and brownstones had to sell since they could not afford paying 20-30k in taxes but at least they walked away with a boat load of money.

Only because Hoboken remains an Abbott district. Also, if you look at the link to the State Treasury's tax statistics, even after Hoboken's "major tax hike," their effective property tax rate is only 1.4%. JC's rate is over 50% higher. Meaning a reval will have far more of an impact.

The real probability of a reval occurring within the next 5 years along with the possibility of JC losing its Abbott district status (in whole or through a gradual phaseout) represents the Sword of Damocles hanging over the head of every JC homeowner. Particularly in Ward E. In my opinion, people who buy in at current prices will be very unhappy once the sword drops.

Posted on: 2015/8/6 21:56

Re: Republican state senator slams Jersey City on tax abatements

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Quote:

MidwestTransplant wrote:
Slightly off-topic, but is there a calculator or a back-of-the-envelope calculation that could be used to determine what property taxes might look like after a property reval? I can't decide how to think about the issue without figuring out how it will affect me first. :)

Simplest ballpark - go to Trulia or Zillow and get a current estimate of value. Multiple by JC's effective tax rate (2.3% in 2014). So a $100k home would pay $2.3k. A $1m home $23k.

http://www.state.nj.us/treasury/taxation/pdf/lpt/gtr14hud.pdf

Posted on: 2015/8/6 21:34

jmcee

Re: Republican state senator slams Jersey City on tax abatements

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I think you'd be crazy to buy at current prices when there's a real threat your property tax bill might double or triple in the next 5 or so years. Meaning once the reval goes through (Ward E) and if JC loses its Abbott district status (everyone).

Hoboken survived a major tax hike and a reval in the last 5 years. Prices and demand remain strong. I know it not an apples to apples comparison but it's food for thought. Long time residents in single family homes and brownstones had to sell since they could not afford paying 20-30k in taxes but at least they walked away with a boat load of money.

Posted on: 2015/8/6 21:00

MidwestTransplant

Re: Republican state senator slams Jersey City on tax abatements

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Slightly off-topic, but is there a calculator or a back-of-the-envelope calculation that could be used to determine what property taxes might look like after a property reval? I can't decide how to think about the issue without figuring out how it will affect me first. :)

Posted on: 2015/8/6 20:42

Re: Republican state senator slams Jersey City on tax abatements

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The tax liens were published in the Jersey Journal which is required by law. I did ask the tax collector how many taxpayers in 2013 were able to redeem their own liens, she said around 200.

Posted on: 2015/8/6 18:19

JCMan8

Re: Republican state senator slams Jersey City on tax abatements

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I think some of this discussion should also be in the real estate bubble thread.

I think you'd be crazy to buy at current prices when there's a real threat your property tax bill might double or triple in the next 5 or so years. Meaning once the reval goes through (Ward E) and if JC loses its Abbott district status (everyone).

Posted on: 2015/8/6 18:12

Re: Republican state senator slams Jersey City on tax abatements

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Whoops! 280%, you're right. My mathematics teachers would be ashamed!

I was able to obtain the average property taxes for Jersey City from the Division of Taxation website.

http://www.state.nj.us/dca/divisions/ ... sources/property_tax.html

Download the Property Tax table excel file for 2014, and you can run all sorts of analysis. I changed the local education budget from $109 million to $528 million, which gave the new property tax number.

Posted on: 2015/8/6 18:02

bodhipooh

Re: Republican state senator slams Jersey City on tax abatements

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JCGuys wrote:
I'm really happy this topic is now front and center and being thoroughly debated.

How much more in property taxes would have to be raised, both dollar and percent wise, if Jersey City was no longer considered an Abbott district?

http://www.nj.com/hudson/index.ssf/20 ... lion_20142015_budget.html
Quote:

The Jersey City Board of Education passed a $665 million budget for the 2014-15 school year last night that will result in a 1.5 percent increase in the tax levy.

The portion of the budget paid for by the city tax levy is about $110 million, while last year the levy was just over $109 million.

Local taxes pay 16.5 percent of the 2014-15 budget, 63 percent comes from state funding, 14 percent from state and federal grants and the remainder from federal aid and other local revenue, Campana said. Jersey City, the state's second largest school district behind Newark, is slated to receive $418 million in state aid for 2014-15, $612,000 more than last year.

So we would need $418 million more raised from local taxes or increase the education portion of the property tax bill by 380%. Current school rate is 1.937. It would have to increase to around 7.3606...

Average property taxes in Jersey City is $6,845. New average would be around $13,243, a 93% increase for everyone's property taxes.

Add in the imminent reval into the loop, which will greatly increase the assessed value of Ward E properties...

And I'm now convinced nothing will happen to the status-quo. It would be Armageddon!

Your percentage figure is off : the new tax amount would be 3.8 times the current levy, which in terms of percentages is expressed as 280% increase (just like a 400 is a 100% increase over 200, not 200%). In any case, your other tax rate figures are correct, but you lost me in getting from $6,845 to $13,243. What was your calculation?

Regardless of the answer, you pretty much reached the right conclusion: NO ONE in JC wants to face the realities that a) because of Abbott funding, our taxes are very, very low when compared to what they would be if we had to cover a large portion of the BOE budget, and b) the combination of a reval and a theoretical rise in BOE budget responsibility could spell some serious problems for many or most residents. I totally *understand* why Fulop cancelled the reval, I just don't agree with the decision.

Posted on: 2015/8/6 17:40

Re: Republican state senator slams Jersey City on tax abatements

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I'm really happy this topic is now front and center and being thoroughly debated.

How much more in property taxes would have to be raised, both dollar and percent wise, if Jersey City was no longer considered an Abbott district?

http://www.nj.com/hudson/index.ssf/20 ... lion_20142015_budget.html
Quote:

The Jersey City Board of Education passed a $665 million budget for the 2014-15 school year last night that will result in a 1.5 percent increase in the tax levy.

The portion of the budget paid for by the city tax levy is about $110 million, while last year the levy was just over $109 million.

Local taxes pay 16.5 percent of the 2014-15 budget, 63 percent comes from state funding, 14 percent from state and federal grants and the remainder from federal aid and other local revenue, Campana said. Jersey City, the state's second largest school district behind Newark, is slated to receive $418 million in state aid for 2014-15, $612,000 more than last year.

So we would need $418 million more raised from local taxes or increase the education portion of the property tax bill by 380%. Current school rate is 1.937. It would have to increase to around 7.3606...

Average property taxes in Jersey City is $6,845. New average would be around $13,243, a 93% increase for everyone's property taxes.

Add in the imminent reval into the loop, which will greatly increase the assessed value of Ward E properties...

And I'm now convinced nothing will happen to the status-quo. It would be Armageddon!

Posted on: 2015/8/6 16:37

Bamb00zle

Re: Republican state senator slams Jersey City on tax abatements

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Quote:

Yvonne wrote:
So, I guess you are OK that 2,300 JC taxpayers went in tax lien in 2013, Adonis. Just wondering if you live in a tax abated building?

Yvonne, these data are interesting and raise lots of questions for me. What is the source for the 2,300 in tax lien? Are they all tax liens? Could there be other reasons for the City having a lien against a property ? unpaid water bills, unpaid fines, etc? I'd appreciate understanding this more fully. Would you be so kind and point me to a source / sources to find out more details.

Posted on: 2015/8/6 15:52