Two-percent tax increase approved by city council
By Jayed Rahman
Published: July 30, 2014
In a 5-4 vote during Tuesday evening’s city council meetings, members of the governing body approved a 2-percent tax increase for city property owners.
The hike is for a six-month temporary budget to allow the city to operate until the administration of mayor Jose “Joey” Torres prepares and submits a budget to the city council. Estimates show the administration wants to raise $145.7 million to fund the city budget, an increase of 1.96-percent from last year’s $142.9 million.
An average property owner with a home valued at $350,000 will pay a total of $10,150 at the end of the year under the increased rate, according to a document circulated by the administration.
“2015 levy is the lowest since 2006,” stated acting finance director James TenHoeve. The director passed out a sheet showing a decade of tax increases which showed a 1.96-percent increase for fiscal year 2015.
Although the increase percentage appears small, the administration is raising virtually the same amount of revenue through taxation as the previous administration did during the last fiscal year. In fiscal year 2014, the city raised $3 million additional revenue through taxation; in fiscal year 2015, the city wants to raise $2.8 million.
Despite the increase, TenHoeve explained that during the last two tax quarters each property owner will see a decrease of $300 in his tax bill due to a reduction in the county tax rate as a result of declining ratable in the city.
“The two-percent suggested by the administration only covers ongoing, non-discretionary expenses,” said Kenneth Morris, councilman at-large. Morris explained that the appropriation will pay for salaries of employees and other day-to-day operational costs. “We would like to see a flat tax, but unfortunately costs don’t remain flat.”
Morris pushed his colleagues to pass the temporary budget comparing it to a household budget which covers essentials like bills and food costs. Morris said, if the governing body did not approve the appropriation all services provided by the city would discontinue.
“If you don’t want to support this, I will give you the employees list,” said Morris. “Circle those folks that you think should be laid off, so that we can flat fund this budget.”
Morris stated that it’s one thing to make abundant promises during the campaign season, but something entirely different when it comes to governing.
Council president Julio Tavarez, 5th Ward, thought Morris’ sense of urgency was disingenuous. Tavarez pointed out that last year the city raised taxes by 2-percent, during which, Morris voted in the negative, yet this year with roughly the same increase, Morris is vocally supporting the increase.
“The only difference last year: it was an election year,” said Tavarez.
Morris defended himself stating last year’s was an “irresponsible budget. We had temporary budgets being presented throughout the entire year.” Morris said this year’s budget provides an estimate for the entire year, presenting a base of $145 million and a ceiling of $151 million.
Following discussions, four council members voted against the temporary budget. “Right now, with my conscious mind, I can’t vote to increase property taxes,” said Mohammed Akhtaruzzaman, 2nd Ward councilman. “I spoke to my residents, my constituents, and they don’t want property tax increases.”
Domingo “Alex” Mendez, councilman at-large; Andre Sayegh, 6th Ward councilman; and Tavarez voted against the tax hike.
William McKoy, 3rd Ward councilman; Ruby Cotton, 4th Ward councilwoman; Anthony Davis, 1st Ward councilman; Maritza Davila, councilwoman at-large; and Morris voted in favor of approving the tax increase.
“Paterson taxpayers are still reeling from the 29-percent tax increase in 2011, and I don’t think many of them will ever recover. And that is compounded by the fact there’s been subsequent tax increases,” said Sayegh. “We’re going to the well one more time, and the well is running dry.”