An informational forum,
sponsored by League of Women Voters
on Property Taxes,
was held September 29, 2005.
September 30, 2005 — The title of the forum
was "Your
property taxes: where does the money go?" The
moderator, Margery Cohen of the Maplewood/South Orange
League, introduced the speakers and took questions
from the audience made up of residents and town officials.
The
first speaker was Tim Gordon, Township Administrator.
He gave the total story on how the total town budget
is established and approved during the course of any
given year. One of his key charts showed how the total
tax rate is distributed — 49% school, 28 % county,
23% municipal. One interesting statistic was the percentage
of taxes paid in relationship to the assessed value.
He said that this ratio has gone down in past years.
While this is an interesting fact it is really not
relevant unless you are selling your home since actual
property tax dollars keep rising. Another interesting
item in the budget was the category they call "surprises".
During past years, there has been money needed for
items like Y2K, Hurricane Floyd, extra protection after
9-11 and other times when extra protection was needed.
This last item, he added, does not appear in the newspapers
for security reasons. He also said that his group and
the education department were and would continue to
look for ways to use county and state cooperative buying
programs to realize savings. A copy of his total slide
presentation with all the details of expenses and revenues
could be available by contacting his office at Town
Hall.
The second speaker was Bob Zeglarksi, School
Business Administrator. His presentation was also very
complete.
He showed the total 2005–2006 budget needed for
schools and where money beyond the 91% from property
taxes
comes from. He showed the top five expense items needed
to run schools and talked about all state controls
in force. He showed all debts we have assumed since
1995. That total is $40,564,000 as of June 30, 2005.
He also made mention of a little known fact that there
is currently a rule titled S1701 which limits budget
growth for 2005–2006 school year to 2.5 per cent
or the inflation rate whichever is greater. This could
effect new hiring (this writer is adding the fact that
this would have impact especially if the referendum
passed and new classes were added). One last statistic
that was not good news was the fact that the cost to
heat the schools doubled from '04 to '05. Bob also
showed a chart with state aid for the 1999 and 2002
referendums
that showed the schools got $9 million in aid in those
two referendums. He also mentioned said the Board of
Ed got $400,000 out of $1 million for new windows at
the High School from the state. Contact
him directly at the Board of Ed for a copy of his detailed slides.
Judith
Cambria, a League financial analyst from South Jersey,
was the next speaker. She held up a few handwritten
charts but there were no leave-behinds like the others
had. She gave a look at taxes at the state
level. She showed that property taxes were $9.8 billion
in 1990 and 15 years later in 2005 they have doubled
to $19.8 billion. Her basic point was that during previous
Governors in office, revenue or state and income taxes
did not go up and this caused property taxes to escalate
rapidly. Judith also informed us that the state has
370,000 more students in past 15 years. She gave us
history that it was the 1960s when state tax came
in, income tax came in during the 1970s when courts
insisted and it was 1990 was when we got a graduated
state tax from a flat tax. During Whitman's governorship,
there was a reduction of income tax and increase in
rebate programs. No new revenue by the state has caused
huge problems with annual debt repayment at $2 billion.
One final major point she made is that income tax is
progressive and property tax is not.
The final speaker,
before questions for all, was town resident Ben Wolfe,
a municipal bond specialist from
Merrill Lynch. His discussed ratings of towns and school
bonds and gave a brief overview. One key fact should
be of interest to town residents. School bonds are
usually not rated as highly as town bonds. Our town
bond program is rated Triple A. On the other hand,
school bonds because of limitations, are not A rated.
He concluded his brief prepared remarks by saying that
if we double the school bond debt (as the Board of
Education has proposed), it would definitely lower
the overall bond ratings for the school system.
There
were several questions at the end of the session directed
to the appropriate speakers. One question
was: "why does Millburn get less state aid for
schools". Another was asked about debt for the
$2 million new town pool. Another was what percentage
did our township pay towards the county taxes (the
answer was Millburn pays 11 percent of county debt).
The last question had to do with the library and the
speaker said there would probably be no state aid for
work needed for the library.
