Louis Rainone, a partner at DeCotiis, FitzPatrick, Cole & Giblin and co-chair of the firm’s municipal practice, was quoted in the article “Voters in 14 N.J. towns to decide whether local governments should exceed property tax cap” in the Wednesday, April 27 edition of The Star Ledger. For the first time in the state’s history, municipal officials must ask voters if it is appropriate to exceed the state-mandated property tax cap. Rainone, who has represented towns across the state, drew on his experience to weigh in on how the electorate will respond to these public referendums.
You can read the article below:
Voters in 14 N.J. towns to decide whether local governments should exceed property tax cap
Wednesday, April 27, 2011
By Megan DeMarco
The Star Ledger
TRENTON — How many extra dollars would you absorb on your property tax bill to keep a library open?
Would you pay an extra $68 a year in taxes to keep an ambulance
How much is municipal garbage pick-up worth to you?
Voters in 14 towns across the state will face these questions today when they go to the polls and decide which box to check: "Yes" or "No."
For the first time in New Jersey, towns seeking to exceed a cap on property tax collections must ask voters for permission. If the referendum is voted down, the rejection will be final, and the town will have to deal with the results. Passage will require a simple majority voters. In most of the towns, both personnel and services are on the chopping block.
The process is a provision of the Christie administration’s new 2 percent cap, replacing one in which towns appealed to the state if they wanted to exceed a 4 percent cap, which had been in place.
Voters across the state will also be voting on school budgets, and 11 districts are seeking approval for additional spending projects.
As far as the municipal spending issues, the towns are allowed to show the reasons why revenue is down on the ballots, but not explain what services or personnel will be cut if the questions fail.
In addition, the ballots ask if the local governments should be authorized to raise the tax levy a specific amount, which varies from town to town; voters must choose "Yes" to authorize collections over the cap, and "No" to send the proposed budget back to be trimmed.
Most mayors and local officials interviewed said they were in favor of letting voters decide despite the fact that if the referendums are rejected then local governments could be crippled.
In Mount Holly and Lumberton, employees received layoff notices Tuesday in case their referendums are voted down. Hardwick would be forced to close its municipal building two or three days a week. Northvale would shut its library. And several towns plan to impose a fee or privatize garbage pick-up if their ballot questions fail.
The burden to justify the increase has been resting on the shoulders of local officials, who in recent weeks have held public meetings and circulated letters to reach out to residents.
"It’s a mixed feeling" among voters, said Kathleen Hoffman, the township manager in Mount Holly. "Some are receptive and understanding, and others are struggling themselves just to maintain their own finances."
Mount Holly needs $750,000 to supplement its $9 million budget, 8.7 percent over the 2 percent cap. On the average home, assessed at $172,500, taxpayers will see a $260 increase if the referendum passes, Hoffman said. If it does not pass, the increase will be $60. What’s at stake are 20 jobs, including those of eight police officers in a force of 22.
In Northvale, Mayor Paul Bazela said he is hoping that voters will approve $500,000 in extra collections, or 8.9 percent beyond the cap, to keep the library open.
"It’s going to affect service and personnel," Bazela said. "That’s all I have left."
In tiny Hardwick, Mayor Kevin Duffy wrote a letter to residents, calling the consequences of a failed referendum "potentially severe." He warned of salary cuts for employees, municipal building closings, and cuts to seniors, recreation and the volunteer fire department.
According to a spokeswoman from the Department of Community Affairs, the state has "strongly suggested" that each town have a Plan B in place should voters reject a referendum. However, the department could not provide details Tuesday as to what those plans were.
Gov. Chris Christie has repeatedly touted the new process, saying it transfers power to the taxpayers.
"No longer is it a group of bureaucrats in Trenton," Christie said last week on a call-in radio show.
He added, "Now it’s you, it’s in the voters’ hands, the people who pay the bills."
Louis Rainone, a partner at DeCotiis, FitzPatrick, Cole & Giblin who has represented town governments, said he does not expect any of the referendums to pass in a tough economy, which will result in fewer services for residents.
"People are hurting, it’s just the tenor of the times," Rainone said. "I don’t think people really understand how difficult it is to deliver services."