JCMan8 wrote:
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thor800 wrote:
Quick appraisal of every property in town ?

Is that even possible ?

It won't be quick. If history is any indication, the process will be protracted and painful. But it is necessary.

SOS wrote:
Much of the information in this thread is incorrect. I spoke to my sources in the city. They are shooting for $25 per thousand post reval. That's 2.5% which is the number they're hoping for. Don't expect it to be lower than that. And the city doesn't talk about percentages. It's always ** dollars per thousand.
Expect some significant spending cuts and revenue generation to have a post reval rate at or close to $25. This could be very ugly.

La_Verdad wrote:
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brewster wrote:
Now tell us where you believe this process will go sideways.

The city hires an appraiser who will underappraise.

La_Verdad wrote:
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brewster wrote:
Now tell us where you believe this process will go sideways.

The city hires an appraiser who will underappraise. Seems pretty straightforward. And, I must say, politically its a brilliant way out of a pretty big mess of his own making for Fulop. (It also could be the beginning of the end if malfeasance is proven.) This issue - not righting an economic disparity that disproportionately affects the poor when he had the power to do so, made doubly worse by the fact that it was by and large the poor subsidizing much wealthier people - was/is probably going to be the issue he'll be attacked most on during the gubernatorial campaign. That's a tough sell to democratic voters in NJ.

Now, he'll package his big box of turd with a wrapping paper of "I was fighting for a just solution and was the victim of politics" and a ribbon of "I cut taxes!"

brewster wrote:
Now tell us where you believe this process will go sideways.

SOS wrote:
Nothing nefarious going on. The budget will be reduced - somehow. Like I said "Expect some significant spending cuts and revenue generation" - reducing the city's payroll is the low hanging fruit I'd imagine. Your guess is as good as mine what else can possibly be cut.

brewster wrote:
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SOS wrote:
There's an incentive to lower the overall tax levy to meet the challenges of the reval.

Can you explain that? Are you saying you believe they'll deliberately under-appraise the most valuable properties to hold down their taxes, thus lowering the levy?...

SOS wrote:
There's an incentive to lower the overall tax levy to meet the challenges of the reval.

brewster wrote:
Quote:

SOS wrote:
Much of the information in this thread is incorrect. I spoke to my sources in the city. They are shooting for $25 per thousand post reval. That's 2.5% which is the number they're hoping for. Don't expect it to be lower than that. And the city doesn't talk about percentages. It's always ** dollars per thousand.
Expect some significant spending cuts and revenue generation to have a post reval rate at or close to $25. This could be very ugly.

Given that the reval is BY LAW, supposed to end up with the exact same amount of revenue, I don't see how you can conclude there will need to be budget changes even IF your intel is correct.

To have the effective rate rise to that extent means that they think the city as a whole is currently overvalued, and would need a higher rate to bring in the same money from a smaller base than the estimate they now use. Possible, but it seems less likely than it's a little undervalued, given the current rate of appreciation.

I wish I could say that it's ridiculous for anyone to be "shooting" for anything, given that the numbers should have complete control. But I've had too many obviously fudged appraisals to believe that it can't be gamed. All you need to do is change the sq footage to hit your target number. I've held the tape for bank appraisers and seen them get it wrong by 20%.

$/k or whatever, it's still just numbers, certain cultures have different nomenclature. Wall St & lenders refers to 1% as "a point", but bond traders "use basis points" to refer to 0.01%. It really makes no difference as long as people know what you're talking about, but sometimes it seems the 'point' is to be obscure.

SOS wrote:
Much of the information in this thread is incorrect. I spoke to my sources in the city. They are shooting for $25 per thousand post reval. That's 2.5% which is the number they're hoping for. Don't expect it to be lower than that. And the city doesn't talk about percentages. It's always ** dollars per thousand.
Expect some significant spending cuts and revenue generation to have a post reval rate at or close to $25. This could be very ugly.

Voyeur wrote:

Folks on this thread have said homes in GV and the Heights are paying a disproportionate percentage in taxes above 2.1%. Is this actually the case? If I understand things correctly, for this to have occurred, these homes have to have a lower value today than they did in 1988 meaning that their current tax burden is northward of 2.1%.

I would have thought that almost every home in JC has appreciated at least somewhat since 1988 - even on MLK and Ocean Ave. Are their really any areas of JC where you will find a house assessed today at a lower value than it was assessed 28 years ago - and consequently paying more than 2.1%?

The point I'm trying to make is, just because DTJC is underpaying on its tax, it doesn't necessarily follow that the other hoods are consequently overpaying on property tax and are due for a tax reduction. The under-taxation of DT has no bearing on whether homes in Greenville are paying 2.1% of their assessed value or not - the relationship between the two is not causal.

thor800 wrote:
Whos to say the city would have been better off had the reval actually taken place ?

I wonder mostly about australian REIT Dixon

JCGuys wrote:
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WhoElseCouldIBe wrote:
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bodhipooh wrote:
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AMo wrote:

In the three years that elapsed since the mayor's decision to cancel the reval, property values downtown have climbed sharply. Ironically, the very same affluent constituents that the mayor was protecting will see even bigger tax increases than they would have had he gone ahead with the reval three years ago.

This is the true irony in this mess.

They did skip out on 3 years of higher taxes, though.

Maybe more than that...

WhoElseCouldIBe wrote:
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bodhipooh wrote:
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AMo wrote:

In the three years that elapsed since the mayor's decision to cancel the reval, property values downtown have climbed sharply. Ironically, the very same affluent constituents that the mayor was protecting will see even bigger tax increases than they would have had he gone ahead with the reval three years ago.

This is the true irony in this mess.

They did skip out on 3 years of higher taxes, though.

bodhipooh wrote:
Quote:

AMo wrote:

In the three years that elapsed since the mayor's decision to cancel the reval, property values downtown have climbed sharply. Ironically, the very same affluent constituents that the mayor was protecting will see even bigger tax increases than they would have had he gone ahead with the reval three years ago.

This is the true irony in this mess.

AMo wrote:

In the three years that elapsed since the mayor's decision to cancel the reval, property values downtown have climbed sharply. Ironically, the very same affluent constituents that the mayor was protecting will see even bigger tax increases than they would have had he gone ahead with the reval three years ago.

AMo wrote:

By Jersey Journal Guest Columnist
on April 23, 2016 at 9:00 AM, updated April 23, 2016 at 9:09 AM
By AARON MORRILL

The chickens have finally come home to roost on Mayor Steve Fulop's plan to kick the revaluation can down the road to Trenton. Superior Court Judge Francis B. Schultz has issued his long awaited ruling finding that Jersey City breached its contract with Realty Appraisal Co. when it canceled a revaluation of Jersey City properties begun under the previous administration.

Only days before, at a raucous meeting of community groups, a local pastor forced the mayor to defend himself against accusations that his policies favor downtown property owners.

As bad as these developments are for the mayor's reputation as a fiscally responsible progressive, the fallout for Jersey City taxpayers is worse. Taxpayers are now on the hook for the entire 3.2 million owed to Realty for now unusable services and, in addition, for legal fees that will, no doubt, grow to half a million dollars if the city appeals. In all, the city will have wasted close to four million dollars. But the costs don't end there.

In the three years that elapsed since the mayor's decision to cancel the reval, property values downtown have climbed sharply. Ironically, the very same affluent constituents that the mayor was protecting will see even bigger tax increases than they would have had he gone ahead with the reval three years ago. Recent buyers of the most expensive non-abated properties may well see their homes' values go down once the market absorbs their new higher tax burdens. Finally, for three long years, as the mayor pursued his ill-advised and losing court case, non-downtown property owners paid substantially more than their fair share of property taxes.

Fulop, Jersey City pastor spar over revaluation
Fulop, Jersey City pastor spar over revaluation
New Jersey tax officials last week ordered Jersey City to complete a citywide reval by November 2017.
It would be nice if the mayor had an excuse for creating this mess. But he doesn't.

His trumped up argument that a prior business administrator had improperly influenced the selection of Realty was contradicted by the city's own employees and emphatically rejected by the court. His argument that the reval would be "devastating" to property owners was disingenuous at best.

Yes, the mayor was right that taxes would go up downtown. But what he conveniently left unsaid was that residents of less affluent neighborhoods would actually see their taxes go down with a reval.

At every opportunity, the mayor has touted his credentials as a former Marine, a progressive and a responsible steward of the public purse. After cowering from the reval, can it be said that he lived up to the Marines' core value of courage?

By over-taxing less affluent neighborhoods, can he lay the claim to the mantle of a progressive?

And by wasting millions of taxpayer money, can he claim to be fiscally responsible?

The mayor should now ponder these questions.

EDITOR'S NOTE: Aaron Morrill is a lawyer, businessman and Jersey City community activist.

stateaidguy wrote:
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brewster wrote:
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stateaidguy wrote:
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brewster wrote:
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stateaidguy wrote:
If Jersey City loses state aid it is to HELP poorer districts.

What metric do we use to determine which city is "poorer" in this context?

Median individual income?
Median Family income?
Property tax paid per capita?

A lot has been made of JC's development, but 3/4 of the city is still relatively poor by NJ standards.

SFRA does a pretty good job of evaluating a district's needs and tax capacity.

Needs is the Adequacy Budget. It is the enrollment with extra weights for poor kids, ESL kids, and then an extra multiplier for concentrated poverty.

Tax Capacity is the Local Fair Share. It is a hybrid that depends on Equalized Valuation and Aggregate Income.

If a district's Adequacy Budget is greater than its Local Fair Share it is supposed to get Equalization Aid.

If LFS is greater than Adequacy Budget it doesn't get Equalization Aid.

If Adequacy Budget is $60 million and Local Fair Share is $45 million, a district is supposed to pay $45 million in taxes and get $15 million in Equalization Aid. (In reality, chances are the district will not get $15 million in Equalization Aid.)

There are aids for sped, transportation, and security, but these are smaller streams and to keep things simple I won't address them here.

Ok, so JC has $21,661,162,459 in EV. It has $7,454,497,639 in Aggregate Income.

Put them together in the formula for LFS and you get $330 million.

And what is JC's actual tax levy?

$112 million

Now let's compare Jersey City to ... say BELLEVILLE. (just a random local working class example.)

Belleville's EV = $2,790,454,316. Agg Income = $916,370,877.

And Belleville's tax levy?

$38 million.

So are you kidding me when you tell me that you can't pay more in taxes when a town with a ninth of your valuation pays a third of your tax levy?

I think I followed that, it is a little arcane and hard to reproduce playing at home. Could you define Equalized Valuation and Aggregate Income? Am I correct in believing the 'equalized value' does not include abated property at all? Or is it squeezed in there somehow?

Actually, we should shove this digression over to the appropriate thread, since the one thing we all agree on is it has nothing to do with the reval.

EV is the market value of property in a town. It is calculated annually by the county tax assessor. If real estate sales exceed assessed values by 20% on average, the assessor multiples the assessed value by 1.2 to get Equalized Valuation.

EV doesn't include abated property. It only includes taxable real estate. (which might include land values for abated properties since land taxes are usually not abated.)

Aggregate Income is total income. I am not exactly 100% sure how this is computed. The people at the DOE I asked didn't know because the data is calculated by the Treasury, not the DOE.

However, The income of residents of PILOTed buildings definitely does count towards Aggregate Income, so if you want to make another anti-PILOT argument you could say that PILOTed properties slightly increase JC's Local Fair Share even though they pay no school taxes.

(JC's aid is determined by Adjustment Aid anyway, so, unless Adjustment Aid is reformed, JC's LFS is irrelevant to its aid total.)

The actual formula for LFS for 2016-17 is


(Equalized Valuation x 0.013156218 + Aggregate Income x 0.046185507)/2


The formula for LFS changes slightly year to year, so you can't compare a district's LFS from one year to another, but within a FY year, you can compare a district's LFS to another district's.

JC's LFS = $330 million.
Edison is #2, but its LFS is only $195 million.

So JC's tax base is 60% larger than the #2 town in NJ.

brewster wrote:
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stateaidguy wrote:
Quote:

brewster wrote:
Quote:

stateaidguy wrote:
If Jersey City loses state aid it is to HELP poorer districts.

What metric do we use to determine which city is "poorer" in this context?

Median individual income?
Median Family income?
Property tax paid per capita?

A lot has been made of JC's development, but 3/4 of the city is still relatively poor by NJ standards.

SFRA does a pretty good job of evaluating a district's needs and tax capacity.

Needs is the Adequacy Budget. It is the enrollment with extra weights for poor kids, ESL kids, and then an extra multiplier for concentrated poverty.

Tax Capacity is the Local Fair Share. It is a hybrid that depends on Equalized Valuation and Aggregate Income.

If a district's Adequacy Budget is greater than its Local Fair Share it is supposed to get Equalization Aid.

If LFS is greater than Adequacy Budget it doesn't get Equalization Aid.

If Adequacy Budget is $60 million and Local Fair Share is $45 million, a district is supposed to pay $45 million in taxes and get $15 million in Equalization Aid. (In reality, chances are the district will not get $15 million in Equalization Aid.)

There are aids for sped, transportation, and security, but these are smaller streams and to keep things simple I won't address them here.

Ok, so JC has $21,661,162,459 in EV. It has $7,454,497,639 in Aggregate Income.

Put them together in the formula for LFS and you get $330 million.

And what is JC's actual tax levy?

$112 million

Now let's compare Jersey City to ... say BELLEVILLE. (just a random local working class example.)

Belleville's EV = $2,790,454,316. Agg Income = $916,370,877.

And Belleville's tax levy?

$38 million.

So are you kidding me when you tell me that you can't pay more in taxes when a town with a ninth of your valuation pays a third of your tax levy?

I think I followed that, it is a little arcane and hard to reproduce playing at home. Could you define Equalized Valuation and Aggregate Income? Am I correct in believing the 'equalized value' does not include abated property at all? Or is it squeezed in there somehow?

Actually, we should shove this digression over to the appropriate thread, since the one thing we all agree on is it has nothing to do with the reval.

stateaidguy wrote:
Quote:

brewster wrote:
Quote:

stateaidguy wrote:
If Jersey City loses state aid it is to HELP poorer districts.

What metric do we use to determine which city is "poorer" in this context?

Median individual income?
Median Family income?
Property tax paid per capita?

A lot has been made of JC's development, but 3/4 of the city is still relatively poor by NJ standards.

SFRA does a pretty good job of evaluating a district's needs and tax capacity.

Needs is the Adequacy Budget. It is the enrollment with extra weights for poor kids, ESL kids, and then an extra multiplier for concentrated poverty.

Tax Capacity is the Local Fair Share. It is a hybrid that depends on Equalized Valuation and Aggregate Income.

If a district's Adequacy Budget is greater than its Local Fair Share it is supposed to get Equalization Aid.

If LFS is greater than Adequacy Budget it doesn't get Equalization Aid.

If Adequacy Budget is $60 million and Local Fair Share is $45 million, a district is supposed to pay $45 million in taxes and get $15 million in Equalization Aid. (In reality, chances are the district will not get $15 million in Equalization Aid.)

There are aids for sped, transportation, and security, but these are smaller streams and to keep things simple I won't address them here.

Ok, so JC has $21,661,162,459 in EV. It has $7,454,497,639 in Aggregate Income.

Put them together in the formula for LFS and you get $330 million.

And what is JC's actual tax levy?

$112 million

Now let's compare Jersey City to ... say BELLEVILLE. (just a random local working class example.)

Belleville's EV = $2,790,454,316. Agg Income = $916,370,877.

And Belleville's tax levy?

$38 million.

So are you kidding me when you tell me that you can't pay more in taxes when a town with a ninth of your valuation pays a third of your tax levy?

Yvonne wrote:
No, it will mean non abated Jersey City taxpayers will pay $4,000 to 6,000 more in board of ed funding to the school district if $224 million is required from local taxpayers.

brewster wrote:
Quote:

stateaidguy wrote:
If Jersey City loses state aid it is to HELP poorer districts.

What metric do we use to determine which city is "poorer" in this context?

Median individual income?
Median Family income?
Property tax paid per capita?

A lot has been made of JC's development, but 3/4 of the city is still relatively poor by NJ standards.

Monroe wrote:
If changes in 'adjustment aid' go through it'll partly be because of the political optics on Jersey City over PILOTS and undervalued properties I'd think.

stateaidguy wrote:
Quote:

Monroe wrote:
The reval will certainly have an impact on this

http://www.njspotlight.com/stories/16 ... ut-of-touch-with-reality/

No! The reval and state aid are independent (despite what Sen. Mike Doherty has said.)

In theory, state aid is supposed to depend on Equalized Valuation and Equalized Valuation is already recalculated every year.

And for Jersey City state aid depends on Adjustment Aid.

http://njeducationaid.blogspot.com/20 ... ty-reassessment-wont.html