Note: The state has approved a special election to be held Tuesday, January 15th. Only Mayor Aufseeser and Councilman Buccellato will be on the ballot. Mayor Aufseeser will remain in office until the winner takes the oath of office.
Monmouth County "found" another vote for Councilman Buccellato in Matawan's mayoral election, bringing the vote to a tie. No doubt, accusations will fly in all directions. Supporters will suggest chicanery at the town level. Detractors will imply election fixing at the county level. And all people will agree that elections are too important to be left to government bureaucrats.
I stated that Councilman Buccellato should not, and probably would not, request a recount. The reasons were obvious. I could not find a single election, conducted by electronic ballot, that had been overturned through a recount. I believed that his slim chances of success balanced against the possible acrimony and accusations that could ensue, would weigh against requesting a recount.
I also stated that Matawan should require automatic recounts in all close elections so that candidates wouldn’t be forced to make this Hobson’s Choice. Citizens have every right to demand that all election counts be accurate and that elected officials are, in fact, elected.
Still, I am shocked that another vote was found. Apparently, someone X’ed an oval instead of filling it in. Perhaps Councilman Buccellato knew of this. Don’t know. Assuming none of the absentee or provisional ballots are challenged, the candidates will need to negotiate a resolution and get approval from the judge. The borough charter is silent regarding tie votes.
There will definitely be another election. The question is when. The options are now or at a future scheduled election. If now, it would need to happen in December to allow the winner to assume office in January.
I’m not about to make the mistake again of predicting what the candidates will do but this is what I’m afraid might happened: Councilman Buccellato will demand an immediate special election. Mayor Aufseeser will provide a thousand reasons to postpone – not enough time, not enough resources, the “found” vote was improperly counted, another recount is needed, etc. The Mayor only needs to delay the process for another two weeks. If she succeeds, the election will likely be postponed to either coincide with the school board election or the presidential election.
Until a special election takes place, Mayor Aufseeser will remain mayor. She has absolutely no reason (but patriotism) to expedite the process.
Of course, a judge could override her but we’ve been there before. Last year, Mike Cannon asked the court to wave the residency requirement for candidates so he could run for a council seat in Matawan. Such a petition had never before been granted in Monmouth County. Yet, Judge Lehrer, in complete disregard for the plain language of the law, allowed Cannon to run because his “heart and mind had always been in Matawan.”
(Cannon, speaking to the court by phone while vacationing in Hawaii, claimed he moved to Aberdeen for financial reasons. His Florida vacation home was ruled irrelevant to the case.)
Will Mayor Aufseeser postpone the special election till next year? She sure could.
>>> Read more!
Wednesday, November 28, 2007
Matawan has a Tie Vote
Aberdeen Plays "See No Evil" in the Upcoming Revaluations
Last night’s town meeting in Aberdeen saw some familiar faces from this past election. Mayor Sobel and Council Members Drapkin, Vinci, and Gumbs were all there. It was easy to recognize them in the crowd. They were the ones smiling.
They have lots to be happy about. It was through their neglect that the town did not have a property revaluation for over 15 years. As Neil Rubenstein of the Realty Appraisal Company explained, 15 years is a very long time to not have a property revaluation. Over that period, property assessments become increasingly disconnected from their market values. Eventually, Monmouth County had to force Aberdeen (and Matawan) to have a revaluation to ensure that everyone was paying their “fair share”.
However, as a result of waiting so long for the property revaluations, there are going to be some major readjustments. Over the next two years, scores of homeowners will see their property taxes rise over 30% while hundreds more will see over 20% increases.
Stuart Brown, the town manager, kept stressing at the meeting that the revaluations are revenue neutral. So what? If a family sees their taxes suddenly go up $1500, do you think they’ll care that their neighbors got a tax cut? Brown also made the point that the town portion only accounts for a sixth of the property taxes. Again, so what? Some homeowners will be facing a massive tax hike and they will rightfully blame the revaluations.
At the meeting, there were several complaints that homeowners were being punished for maintaining their homes. New Jersey property taxes are “ad valorem”, according to the value. A well maintained home is worth more than a poorly maintained home and is therefore charged a higher tax rate. The town insists there’s nothing they can do about that.
Let’s be clear – Mayor Sobel and the Town Council are personally responsible for any tax upheavals and there’s plenty they can do about it.
First, they should guarantee all homeowners that annual tax hikes will be capped at 10%. While still high, it’s far better than having a 20% or 30% tax hike. Those whose taxes would normally rise higher than 10% could receive financial assistance from the town in the form of a tax credit so that the net result would be a 10% increase.
Given the fact that Aberdeen has a normal distribution of property values, the vast majority of homeowners would not require assistance from the revaluation. Of those that do, nearly all of them would be phased out over the first three years. Ultimately, they will be forced to pay their “fair share” but at least there would be a transition period allowing them to adjust.
The program would cost under $3 million over a five year period. The money would come from the road maintenance program, where we spend $2.5-$3 million a year. Yes, the roads need to be improved but they won’t crumble because the program was under funded for a couple of years. I’d rather drive on a bumpy road then watch more people forced from their homes.
Next, the town should make certain this never happens again. As I’ve outlined in an earlier posting, the town could require each homeowner to assess his own property at least once every ten years. The homeowner could schedule his assessments prior to any major improvements. This would allow the homeowner to improve his home without any immediate tax penalties and to plan ahead for future assessments. It would also give fair notice to any future homebuyer.
Lastly, by postponing all new projects for one year, the town and the school could both have a one-year budget freeze. Not only would this create long term fiscal benefits, it would greatly help the public through the upcoming revaluations.
Unfortunately, the town plans to do absolutely nothing for those poor folk who are about to have their property taxes skyrocket. The town council created this situation through their neglect. The council has the power to help. To act otherwise is heartless and cruel. >>> Read more!
Monday, November 26, 2007
The Politician's Mindset
Our taxes are too high. Our schools are failing. Why don't our elected representatives fix the problems?! Because, once elected, they become politicians.
Politicians perceive a different reality from the rest of us. To understand why government officials do what they do, we need to first understand their mindset. This is how they think:
What can we do? The general public has three demands:
President Reagan once famously said that the ten scariest words in the English language were “Hello, I'm from the government and I'm here to help.” But that's not the view of most office holders. Next year, the combined budgets of Matawan and Aberdeen , including the school district, will approach $90 million dollars. When you oversee that kind of money, and you have the power to regulate people's behaviors, and your constituency is pleading for you to take action, it's extremely difficult to say no. You become a believer in the awesome power of government. You believe government should do more because it can.
$90 million dollars is an extraordinary amount of money. Expressed in one-dollar bills, it would stretch over 8,500 miles and weigh over 140 tons. Yet, nearly every elected official in Aberdeen and Matawan will tell you it's not enough. Why? Because they ran for office to do more, not less. And they come to believe that every problem can be solved by throwing enough money at it.
Budget increases are always reflected in percentages, not dollars. For example, the school's new Response to Intervention (RTI) program is expressed as a 1% increase in the school budget rather than $600,000 in new annual spending. One percent sounds small. Even five percent sounds small. In the politician's mind, the taxpayers can surely afford these small increases. But, in fact, the increases are huge. If we froze the municipal and school budgets for Matawan and Aberdeen for just one year, we would save $35 million dollars over the next five years, an average of $3,000 per household.
A member of the school board told me that the budget must go up every year but he tries to restrain the increase. A representative of the township told me that there are no plans for reducing the costs of road maintenance or controlling pension fund liabilities. Both people are fiscally prudent. Both people recognize we're among the heaviest taxed in the county. Yet, they intend to raise our taxes every year. Why? Because it's easier to raise taxes than it is to fight the unions, the special interests, and Trenton . Instead, they spend all their time trying to save us a few bucks here and there so that our tax increases are a drop smaller.
Every major business and industry goes through cycles of creative destruction. Every cycle has winners and losers but, overall, the general public benefits. Government accounts for over one-third of the United States economy yet refuses to permit any creative destruction within its sphere. Does the federal government really need a law enforcement branch dedicated to alcohol, tobacco, and firearms? No. Is spending nearly half a million dollars a year on four kindergarten teachers really the best use of school funds? Of course, not. Why do they allow it? Because no one wants to fight the system.
Politicians count the votes. They can only pursue their pet projects if they have the political clout. Why are special interests treated better than the general public? Because they're passionate and will fight for or against a politician based on a single issue while the general public takes a more balanced (and often apathetic) approach.
In the politician's mind, there are only three reasons why the public wouldn't support him:
A) The public knows too little
B) The public is wrong
C) The public knows too much (i.e. they know something they shouldn't)
It doesn't occur to them that maybe, just maybe, the people are right.
If a politician succeeds, the credit is his. If he fails, there are many to blame.
The politician is a true believer in his personal vision and capabilities; only he can lead us to the promised land.
To establish these three pillars, we, the public, will have to fight for them. “Don't place your trust in princes, in the son of man, for he does not possess salvation.” (Psalms 146:3) This is a fight that will never end. >>> Read more!
Friday, November 23, 2007
Losers and Winners in the Upcoming Property Revaluations
Matawan recently announced that its property revaluations have been completed. Aberdeen will be having a public meeting on November 27th to discuss their 2008 property revaluation. It’s no surprise these announcements took place after the elections. The news isn’t good.
Property taxes are determined according to a property owner’s “fair share” of the tax burden. The taxing body “assesses” the value of all taxable properties (ratables) within its jurisdiction. The total value is called the assessment roll. A property’s fair share of the tax burden is equal to its share of the assessment roll, or “ad valorem”, according to its value.
To simplify the math, taxing bodies express taxes in terms of a tax rate. The tax rate is equal to the appropriations (needed tax revenues) divided by the assessment roll and expressed in dollars per hundred dollars of value. For example, if a school needs to raise $5 million in taxes and the total assessment of all ratables is $100 million, then the tax rate would be $5 per $100 of assessed property value. If a home is assessed at $500,000, that home’s annual tax burden would be $25,000.
The municipal revaluations are being mandated by the state. Previously, assessments were a percentage of market value. For example, in Aberdeen, a property’s assessment was 45% of its estimated market value. The state now requires that all property assessments be uniform at 100% of market value.
In theory, property revaluations should have no effect on an individual’s tax burden because they don’t change the property’s fair share. For example, if there are ten homes of equal value, each homeowner would be responsible for 1/10th of the tax burden. If all the homes suddenly doubled in value, each home would still be responsible for 1/10th of the tax burden.
The problem is that current property assessments in our neighborhood are wildly inaccurate. Aberdeen’s last property assessment was in 1992. Following the Rule of Thirds, after the revaluations, a third of the properties will see their tax bills decline, another third will see little change, and the remaining third will see their taxes go up.
For example, Aberdeen Township estimates the value of 2 Campbell Ct., a custom colonial, at $470,700. In 2007, the home sold for $625,000. Between the revaluation and next year’s estimated tax increase of 5% (the state’s 4% tax increase cap allows for certain exceptions) the homeowners at 2 Campbell Ct. could be looking at a 25% property tax increase.
119 Courtland Rd., a country clubber, is valued at $348,000. Last year it sold for $450,000. It, too, could be looking at a 25% property tax increase.
681 Cliffwood Ave., a modest house on a small lot, has an assessed value of $210,000 but sold this year for $365,650. The homeowners could be hit with a 60% tax increase.
12 S Atlantic Ave., a condo by the train station, sold this year for $175,000 but the town only valued the property at $90,700. It’s facing a possible 80% tax increase.
At this point, it’s impossible to know how much property taxes will change until the property revaluations are completed. Obviously, there are far more homes that are undervalued than overvalued since homeowners are quick to challenge high property assessments. For this reason, I've tried to give conservative estimates for possible tax hikes. Still, if the Rule of Thirds holds, many homeowners could be subjected to property tax increases over 20%. (Percentage-wise, the more affordable homes are facing the largest increases.)
As for the municipalities, they see it as a good thing that these homeowners will finally be forced to pay their fair share. There is no cap for how high property taxes can go up and there is no assistance available for those families facing a huge tax increase.
The easiest way to see if you’re at risk of a huge tax increase is to visit the New Jersey Tax Records site and look up your home address. Divide the total assessed value by 0.40 to get the assessed market value. If the actual market value of your property is more than 10% above the municipal estimate, be concerned.
If you’re thinking you can sell your home before the new assessments, think again. All realtors are required to inform prospective buyers of the revaluations.
Matawan and Aberdeen will be talking about tax rates but the only thing that matters is the tax bill. Some homeowners will be facing massive tax increases next year. If these homeowners have adjustable rate mortgages as well, expect to see more foreclosures. >>> Read more!
Tuesday, November 20, 2007
Fighting Over Crumbs at the School Board
Last night’s Board of Education meeting for the Matawan-Aberdeen School District was painstakingly long but chock full of interesting tidbits. Sadly, tidbits were all we got.
The single largest item was the audit. Though technically dense, there were some very disturbing findings. In a sampling of purchase orders, twenty-five percent were either blank or for non-earmarked items. The board and auditing firm did their best to assure the public that there was no evidence of fraud but, to the contrary, this is strong evidence that there is fraud. Someone looking to buy party supplies for his kid’s birthday could easily generate a purchase order and list stationery. As far as the auditor is concerned, there’s no sign of fraud because the money is accounted for. Slopping bookkeeping in the school system could easily lead to widespread pilfering that would be undetected by an ordinary audit. Normally, the school administration budgets more money than necessary to stay on the safe side. In this instance, due to “sloppy bookkeeping” there was a $134,000 shortfall.
The auditor also mentioned a $1.7 million shortfall in the listing of capital assets. Once again, the board tried to reassure the public that this was only an “accounting” item that didn’t affect revenue, expenses, or cash flow. Nonsense. Capital represents long-term assets that depreciate over time. If this capital depreciates at a 5% annual rate, then we’d be underestimating our cost projections by $85,000 per year.
Other little morsels included Ex-Superintendent Quinn shaking down the school for $5,000 in order to cooperate in some arbitration hearings. Then there was the $6,000 for five school administrators to attend an educational conference in New Orleans.
When asked why the schools were spending over a $100,000 a year on extra-curricular advisors rather than use community volunteers, Interim-Superintendent Glastein explained that the schools were contractually bound to pay teachers for these advisory positions even if qualified volunteers were willing to do the work for free.
The board also decided that, in addition to the $28,000 spent this year on the school's new website, the district would spend another $1,880 to instruct teachers how to best make use of the site.
Glastein’s new contract was also reviewed. Even though the new position is only temporary, the board felt he deserved a $7,000 raise rather than a one-time bonus to cover his expanded duties until a new superintendent is found.
As is customary for the board, none of the “objectionable” expenditures were rejected but rather tabled for reconsideration.
Dr. Gambino, the newest member on the board, asked why the school had not been reimbursed the $24,000 for an assessment exam that was never properly evaluated. The administration explained that the vendor was unresponsive and withheld needed textbooks until the bill was paid.
While interesting and often fun to watch, these sideshows don’t even add up to one percent of the school budget and have nothing to do with the school’s mission, namely to educate our children.
On this point, Dana Egreczky, Vice President of the New Jersey Chamber of Commerce and President of the Business Coalition for Educational Excellence (BCEE), promoted the BCEE’s new program, LearnDoEarn.org. She stressed the need for requiring students to take more demanding courses, to learn advanced math and science, as this will dramatically impact their likelihood to succeed in life. Egreczky presented an abundance of statistics showing that without more math and science, our students were more likely to fail in college than succeed.
Egreczky’s passionate call for higher standards seemed to be met with a giant yawn. Board Member Gerard Donaghue, in a remarkable display of ignorance, questioned why the school should train its students for high-tech positions when “they’re all being outsourced.” In fields requiring advanced science degrees, the United States is experiencing the largest labor shortage in its history. For an educator to be unaware of this simple fact is stunning. That nobody on the board responded was shameful.
Dana Egreczky was right. We need to raise our standards. We need to mandate that all students take advanced math, science, and language classes. And we need to do it now. This should have been the central topic of last night’s board meeting.
Imagine all the verbs you associate with educators: Teach, Educate, Instruct, Tutor, Train, Develop, Coach, Nurture, etc. You won’t find one of these verbs in the Board of Education’s mission statement. When the school board discovers that it’s their job to teach, instruct, tutor, train, develop, coach, and nurture our children, then we can hope for a better future. >>> Read more!