Prospect Of 27% Property Tax Increase Has Residents Concerned

http://www.nytimes.com/2009/03/01/nyregion/new-jersey/01westnynj.html

Property Owners Lash Double-Digit Tax Increase

Nadav Neuhaus for The New York Times

OPPOSED Raymond Morejon, a florist, attending a rally in West New York. He says the tax hike may put him out of business.

NATE SCHWEBER

FIST and voice both raised, Carole Rodriguez, 64, joined hundreds of outraged residents in front of City Hall on a recent Friday afternoon to protest a 27 percent property tax increase.

“It’s immigrants and working people who make this city what it is, that’s why we love it,” said Ms. Rodriguez, who saw the taxes on her small, one-bedroom condominium jump $1,200 a year. “We’re being priced out.”

City officials say the tax increase is the only way to plug a more than $15 million budget shortfall in this working-class town of around 46,000 with a nearly $70 million annual budget just across the Hudson River from Manhattan.

State officials say that West New York is the most exaggerated example of how towns throughout the state are coping with declining revenues as the national recession trickles down to Town Hall. “The bottom line is you’ve got an economic crisis that is having a horrendous impact on our local government’s ability to maintain its present tax base,” said William G. Dressel Jr., executive director of the New Jersey State League of Municipalities. “And a state government that has been reducing the property tax relief funding at a time when it’s needed most by citizens and taxpayers to offset the most regressive tax in the nation, which is New Jersey’s property tax.”

Robert Corrales, a spokesman for the governor’s office, said that the administration is reviewing the federal stimulus package that President Obama signed, but that it is not yet sure if or how it would affect aid to cities and towns. Chris Hoene, director of policy and research for the National League of Cities, said the stimulus money would go toward specific municipal government programs, like transportation or helping people stay in their homes, which could indirectly “shift the burden” away from property taxes.

He added that in New Jersey, as well as several other predominantly northeastern states, the property tax is the primary source of municipal revenue, as opposed to the sales or income tax.

“It’s the lack of other options that forces this scenario,” he said.

West New York will lay off 100 municipal employees, around a quarter of its work force, including police and fire personnel, officials said.

Joseph McConnell, the business administrator for West New York, said the city incurred millions in debt from rolling bills over year after year, like insurance payments.

Last year the city plugged part of the hole with $9 million it raised from selling a municipal parking garage to the Hudson County Improvement Authority, Mr. McConnell said, though the town was still forced to raise property taxes by more than 20 percent. This year the city had no other properties to sell, Mr. McConnell said, and the only option was to raise property taxes again.

“It’s like a wave that crashes down on you,” he said. “Our backs were against the wall.”

Raymond Morejon, 52, a florist who has run a shop on 61st Street since 1981, said that the tax raises threaten to put him out of business, as he has had to borrow money to pay the increase. He has attended several of the town’s antitax rallies and circulated petitions calling for the mayor to step down.

“This was the wrong time and the wrong amount,” he said. “It’s like, overboard.”

The national recession, which has led to declining home sales and decreased revenues for towns and cities, may not be the biggest player in West New York’s current budget drama. Mayor Silverio A. Vega, known as Sal, blamed the town’s former chief financial officer, Darren Maloney, for the budget shortfall. Mr. Vega said Mr. Maloney kept the municipality’s commissioners in the dark about the town’s mounting debts.

“After suspending our C.F.O. in August we saw the magnitude of the problem,” Mr. Vega said. “While he was there it was hard to understand how he kept the finances of the town.”

Mr. Maloney could not be reached for comment.

Many angry city residents don’t believe the mayor’s claim that the budget could have been so far off balance without his knowledge.

“He can’t blame one person, he’s the mayor of the town, he’s supposed to oversee everybody,” said Ana Pereira, 41, who owns a restaurant called Ana’s Kitchen and also circulated a petition calling for Mr. Vega to resign.

Felix E. Roque, a doctor who said he planned to run against Mr. Vega in the 2011 election and has recently been giving fiery speeches to crowds of hundreds opposing the tax increase, said many residents are now forced to choose between their taxes and their basic necessities.

“A lot of people are sleeping in the cold or eating one meal a day,” he said. “This is killing us.”

Statewide it is too soon to know how many towns will be hit with a large property tax increase, said Joseph V. Doria Jr., commissioner of the Department of Community Affairs.

“Many municipalities are still in the process of introducing their budget,” he said.

Along the Hudson River, on what is commonly referred to as New Jersey’s Gold Coast, residents in Hoboken are feeling the sting of a 47 percent property tax hike, enacted because the state sent in a supervisor to manage the city’s finances after the city council failed to pass a budget.

“When the budget is adopted for 2009 and 2010 you’re going to see a substantial leveling off of our tax levy,” said David Roberts, the departing mayor.

Officials in West New York also said that property taxes should level off next year and in the future increase only from 2 percent to 3 percent annually just to keep pace with inflation. Their words have offered little solace to home and business owners grappling with how to make ends meet after this year’s raise.

“This is impossible, I haven’t paid my utilities, I haven’t paid anything,” said Claire Lima, 55, an out-of-work homeowner who said that after the increase, her property taxes jumped to $3,000.

Comments

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