Thursday, July 27, 2006

Taxes, Taxes, Taxes

From the Daily Record:

Waiting for Corzine: Property tax speech is talk of the town

State senators and assembly members won't be the only ones interested in what Gov. Jon Corzine has to say about property taxes when he addresses them in Trenton tomorrow.

Local educators, new homeowners and senior citizens, especially, all want to know how the governor intends to lower the state's property tax burden.

Corzine is expected to discuss specific ideas to cut property taxes by 20 percent, including, for example, using sales tax revenue.

The governor wants to use the $600 million from a sales tax increase to entice New Jersey's 21 county and 566 municipal governments, 616 school districts and 186 fire districts to consolidate and share services. He has suggested using that $600 million in annual revenue to borrow as much as $7 billion to reward governments that merge and share services.

"I'd like him to discuss overall 'real' tax reform," said Jerry Cantrell, president of the Silver Brigade, a tax-reform organization based in Denville.

"Not the 'relief' we've been getting inundated with," he said.

Help for Corzine

Gov. Jon Corzine should say the following when he addresses the state Legislature tomorrow about property taxes.

"This has gone on long enough. We talk and talk about property tax reform and nothing happens. The public is totally fed up and we should be as well. That means the status quo cannot continue. Yes, that sounds like a cliché, but we as leaders of our state must show the public we are not merely mouthing clichés.

"To substantially cut property taxes, we must begin by looking at what property taxes support -- local government and schools -- and see if that money can be raised more equitably. It is beyond dispute that property taxes are inherently unfair in that they tax the ever-escalating value of property without any regard to income levels of property owners.
...
"We can begin doing that by adopting the premise that home rule, a relic of the 1800s, belongs in the history books. The only people who care about home rule are the ones doing the ruling.

"As a state, we cannot rely on local officials to voluntarily relinquish their fiefdoms. Towns and school districts are creations of the state. It is time for the state to un-create some of them, or actually, many of them. The state must order small towns and school districts to merge either services or entire governments, thereby eliminating overlap and countless jobs.
...
"And we must demand that local governments and school boards live in the real world. The days of awarding pay raises of 4 and 5 percent to union bargaining agents and creating high-paying public jobs to help a political buddy must end. If local government units persist in doing that, I will order the state Department of Community Affairs to reject their budgets."

"In short, we must raise taxes for local government more fairly and sharply reduce the cost of that government by consolidating towns, merging services and demanding spending cuts. To do anything less would show us incapable of leading this state."

29 Comments:

Anonymous Anonymous said...

I'll say it again, this has to be about carrots and sticks, and the sticks have to be wielded more than the carrots get awarded.

The problem is what will happen in larger towns which have problems that can't be eliminated by combining services; they're going to actually have to cut employees, including cops.

School districts are another story. To get a meaningful reduction in property taxes, there has to be some cuts, but there will also have to be an increase in some other tax (if not sales, then income).

Finally, there has to be a meaningful limit placed on the ability of both school boards and municipalities to tax. If they don't do that, it doesn't matter if they reduce propety taxes to zero, we'll be right back here before long.

Lindsey

7/27/2006 07:04:00 AM  
Anonymous Anonymous said...

All this will involve job cut and hence more jobs are going to lose in new jersey.

7/27/2006 08:15:00 AM  
Anonymous LeeS said...

Having lived in NY most of my life, I'm amazed at the concept of complete Police Departments for each township. I understand that at the turn of the century, NY worked the same way until someone had the briliiant idea to create a full NYPD with reporting into channels instead of full re-creations of departments from top to bottom. Does a town with a population of 7,000 really need a staff of 24 police officers?

7/27/2006 08:17:00 AM  
Anonymous Anonymous said...

What happens when one town with good schools combines with an undesirable school system? I doubt a town like scotch plains or westfield would even consider combining school systems with the Plainfields. Talk about an uprising by Scotch Plains residents. I find it difficult to imagine that local governments / school districts would merge. Imagine how this could impact property values. Don't we pay premiums for living in "better" towns?

7/27/2006 08:22:00 AM  
Anonymous Anonymous said...

Housing , going into the tank.

permits down
new homes slow
housing prices coming down
existing home sales soft
mortgage rates up
inventory up


Hum,,,,


what say you

7/27/2006 09:15:00 AM  
Anonymous Anonymous said...

Got to admire Corzine for his tough stance but I seriously doubt anything will change. There is too much political resistnace for significant change to happen and before you know it, we'll have a new Governor voted in. C'est la vie.

7/27/2006 09:55:00 AM  
Blogger chicagofinance said...

Anonymous said...
I'll say it again, this has to be about carrots and sticks, and the sticks have to be wielded more than the carrots get awarded.

The problem is what will happen in larger towns which have problems that can't be eliminated by combining services; they're going to actually have to cut employees, including cops.
Lindsey
7/27/2006 08:04:25 AM

Interesting.

I think the real problem is not the number of cops or teachers, it is the number of bureaucrats. In Hoboken, yes the teachers make a good living, but ultimately, the reason for the outsized cost per pupil is due to the fact that for every teacher in a classroom, there are way too many paper pushers that, in their totality are redundant. Maybe they perform a set of responsibilities, but ultimately their job is to create a job for themselves to look busy.
Hoboken's problem with the cops is that there just are too many promotions, to many captains, too many desk jockeys.

Having worked in support functions at major U.S. Corporations, if you are not part of the revenue generating function, then ultimately you role is to be a tool for the company to implement its strategic mission. When support functions forget their mission [to support in an efficient way] bloat is inevitable.

In New Jersey, people in government have forgotten that its role is to serve the public, and the mission is to have a thriving State. There is too much "finite pie" thinking, and local governments forget that they - DON'T GENERATE ANY REVENUE - and their arrogance is going to SHRINK THE PIE.

7/27/2006 10:04:00 AM  
Anonymous UnRealtor said...

"Does a town with a population of 7,000 really need a staff of 24 police officers?"


What is the police arrangement for Garden City, which is footsetps away from the hell of Hempstead?

A town like Garden City would probably need more than 24 police to keep the marauding lunatics at bay.

7/27/2006 10:07:00 AM  
Anonymous UnRealtor said...

"What happens when one town with good schools combines with an undesirable school system?"


Maplewood.

7/27/2006 10:08:00 AM  
Anonymous Anonymous said...

Yes combine Tenafly with Englewood.

Try Clifton with Passaic and Paterson.

How about Montclair and Newark,Bloomfield,Nutley.

In some cases you would have to
patrol with the National Guard.

7/27/2006 10:18:00 AM  
Anonymous Anonymous said...

I dont get the idea of using sales tax revenue for property tax relief. I see - lets lose 30% in administration costs and redistribute it. Makes sense. And this guy was a Wall St wizard?

7/27/2006 10:24:00 AM  
Blogger chicagofinance said...

And this guy was a Wall St wizard?



actually he wasn't

that is why he ended up in management

if you don't bring in revenue at an i-bank, then you are nobody

7/27/2006 10:29:00 AM  
Anonymous Anonymous said...

Taxpayors subsidizing extravagance.

7/27/2006 11:09:00 AM  
Blogger RentinginNJ said...

All this will involve job cut and hence more jobs are going to lose in new jersey.

I disagree. Yes, the short term impact may be cutting some public sector jobs. This happens all the time in the private sector, yet unemployment remains under 5%. By pruning waste, inefficiency and redundancy from public sector, you can put more money back into the hands of taxpayers, create a more business friendly climate and ultimately encourage private sector jobs.

Besides, I seriously doubt any rank and file union members will lose their job over this. It just won’t happen.

First, I agree with Chicago that it’s not a matter of “too many teacher”. As for cops, I think there probably are too many.

At the end of the day, the public debate will come down to a series of sound bites fed to a largely uninformed public. It will be spun as “your friendly neighborhood police officer and teacher trying to keep you safe and educate your children against faceless Trenton lawmakers who don’t care about the children”. It will come down to the tired old “the rich and big business aren’t paying their fare share” argument.

7/27/2006 11:34:00 AM  
Anonymous gary said...

Let me repeat this one more time: Nothing.........will.........change.

7/27/2006 11:43:00 AM  
Blogger chicagofinance said...

gary said...
Let me repeat this one more time: Nothing.........will.........change
7/27/2006 12:43:21 PM

gary:

I has to change on some meaningful level. It is not sustainable. NJ is in trouble while other states are running big surpluses. We aren't even in a recession!!!

7/27/2006 12:33:00 PM  
Anonymous Anonymous said...

When they talk about combining school service, they aren't talking about combining the school systems; only the administration. Combined school boards in charge of superintendents/business administrators who are in charge of two+ smaller districts. Mine Hill and Wharton is one example. The schools stay in tact, but ONE superintendent oversees them both.

Good idea, but people are STILL resistant to it. Local control, you know.

"Finally, there has to be a meaningful limit placed on the ability of both school boards and municipalities to tax. There is for schools. There's 3% or 3.5% cap on budget increases.

D

7/27/2006 12:44:00 PM  
Blogger lindsey said...

To Chicagofinance:

I would have to agree with you on the bulk of your school system assessment, administration is indeed where the fat is. My point is, even with cutting admin, schooling remains an exceptionally pricey proposition, more so when students come in without any academic emphasis at home -- the key to any school system is parents involved in the child's education.

I always note the police situation because in any municipality with a department, that is the single largest expense. I don't think there are any towns of 7,000 with a 24-member department, but 10-15 and a dispatcher (many towns no longer have dispatchers, instead relying on a central dispatch station controlled by their county) or secretary or two is pretty likely.

The redundant admin costs are but one small part of the extra expense. The simple fact is, most town's have more cops than they need. I don't track the stats anymore, but 5 or 10 years ago most Monmouth/Middlesex county communities had about 1 cop for every 500 residents. The worst ratio I remember was Red Bank which had something like 1 cop for every 250 residents.

I don't know what the ratio should be, but I'm willing to bet 1,000 to 1 in a centralized system would work very well, and save lots of money.

On a second point, Corzine must have been worth something to Goldman, because they sure paid him a hell of a lot of money and I don't think they're in the habit of doing that for dopes and slackers.

Finally, I'm with you on the change thing. It's going to happen because it can't not happen.

7/27/2006 12:57:00 PM  
Anonymous Anonymous said...

Timing and Luck are very important
in the Fiance business.

Corzine had luck on his side.

He was escorted to the door at
Goldman. That's a fact.

7/27/2006 01:20:00 PM  
Anonymous Anonymous said...

My local school district runs a lean ship--admin to teacher/pupil ratios well below state average.

Where schools get creamed is on special ed, particularly for kids with autism/Aspbergers, or those who get classified with one of the behavioral sets that get lumped under the ADD/ADHD rubric.

By allowing schools--particularly those in denser populated parts of the state--to combine services for special needs kids (regionalizing special ed), and to have roving counselors who go from school district to school district (setting up hours during the school week), the kids will remain well served, and the school districts could greatly reduce the cost of providing for special needs kids.

This is a case where district autonomy provides no discernable benefits. Unfortunately, the parents of special needs kids are often more vocal and activist, so their arguments tend to carry greater sway.

7/27/2006 01:30:00 PM  
Anonymous Anonymous said...

THE parents of special needs
kids usually are vocal.

The admin goes along with it for the funding.

Most of the programs are scams.
And most don't work, you know that.

If it was up to the admin. all the
kids would be in special needs and
they would all be on drugs.Including the teachers and
the admin.

7/27/2006 01:33:00 PM  
Anonymous Anonymous said...

Regionalizing special education is unlikely to happen as it's not "least restrictive environment." Parents of special education students have, know & use their extensive rights to be sure that their kids get the best services possible. Unfortunately, the costs of those services use a great, great, great deal of money.

Most schools aren't administratively heavy, imo, but I do think some regionalization in that respect couldn't hurt.

I don't think it's equitable that local municipal governments can spend, spend, spend without input from the voters while schools are under the microscope. It's no wonder school budgets fail in NJ; it's the only power the voters are allowed to have.

D

7/27/2006 02:43:00 PM  
Anonymous Anonymous said...

I don't think you can cut any teacher position, unless we cut students. I knew some teachers in new jersey already teach 6 or 7 classes. But we should cut the non-teacher staff position, like administration. Also we can not teacher's salary, with current salary, some school district are hard to find qualified teachers.

7/27/2006 02:45:00 PM  
Anonymous Anonymous said...

Not top heavy take a look at
Bergenfield,you could empty
out at least 5 offices and they
would never be missed.

Why do you think one of the reasons
the taxes are so out of control
in the town.

Check the salaries of these people.
Totally out of control.

7/27/2006 03:10:00 PM  
Anonymous Anonymous said...

All this will involve job cut and hence more jobs are going to lose in new jersey.

Government hiring has grown at 5 times the rate of private sector hiring which has been flat or decreasing over the last three years and trending lower. There is so much redundancy in state government, local gov't and county government. Abbot School funding is loosely managment, School Consturction Corporation was the biggest joke of the century, UMDNJ (still dont know what the repercussions will be from Medicare mis billing etc.) Get our damn money back. Petillo "resigns" from UMDNJ and gets a 500K severance package. Enough is enough. We simply cant pay anymore. we're stretched

7/27/2006 03:34:00 PM  
Anonymous Anonymous said...

Here is how Bergen County services would look like if they were to be regionalized like Florida - in this case I'm looking at Sarasota County.

County Fire & Rescue - professional staff operate fire truck, paramedic ambulances, and does fire inspections & trains public in CPR, Fire Safety and alike - Volunteer component under accountable, professional responsibilities and provided with stipend and Length of Service Pensions (LOSAP). Volunteers are acitvated in their local community where they reside in, when extra manpower is needed. A true fire vs. alarm activated. Everyone is minimally a Firefighter/EMT. - To achieve this all county towns'd fire dept, first aid squads, and hospital run paramedics merge.- But you will get much better service & cheaper.

County Sheriff takes over for law enforcement except for the big towns over 25k, and this is iffy. They could considerably provide all county services (wil have Traffic Unit that handles meter maids job). County PD, Prosecutors office & local PD merge into it.

Same goes for County wide Bd of Ed.

7/27/2006 05:13:00 PM  
Anonymous Anonymous said...

Special ed drains a tremedous amount of money out of other programs and overburdens the taxpayer. While we do need to provide for all students we also need to look at the best way to allocate resources.

If we spend three times as much money per pupil on a student who, at best, may be employed in food service one day and yet fail to provide meaningful programs for a gifted student who might invent alternative fuel sources then where will we end up as a society?

As a teacher and parent I'm outraged by the whole "special ed system". In the affluent district where I teach parents go out of there way to get "normal" students "classified" in order to get an extra 1/2 hour test time (class tests, SAT etc) and other accomodations so their child may have a leg up on their peers. This creates an impossible situation for teachers and an undue tax burden on homeowners.

I agree that there should be regional special ed schools for those who truly have "special needs". This would save on costs and keep teachers from having to focus all of their valuable time and attention on special ed students who have been "mainstreamed" despite the fact that they are not capable of doing grade level work without accomodations.

Most districts break their budgets with special ed and have no meaningful gifted programs. Shouldn't we be encouraging and challenging the best and the brightest so that we as a society can innovate and lead?

7/27/2006 08:08:00 PM  
Anonymous Anonymous said...

How about Montclair and Newark,Bloomfield,Nutley.


hate to tell you, but Montclair is on the level as Newark and Bloomfield. Can't teel you much about Nutley, but they seem to be far above the hoods I just mentioned.

7/27/2006 09:33:00 PM  
Anonymous Anonymous said...

Anon 10:55am said...
"Got to admire Corzine for his tough stance"


I take it you also think WWF wrestling is real?

7/29/2006 02:59:00 PM  

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