Archive for the ‘Taxes and Budgets’ Category

By far my biggest complaint is our city’s lack of a strategic plan. All of the mayoral and council candidates stressed the need for it in the election, all of them.

So here we are one and a half years later and we have nothing, no plan at all. Not even a bad one.

The Mayor says the “state of city” pamphlet is his plan. It’s a document full of past statistics that are mostly irrelevant. Nothing about it discusses our measurable goals and how we’ll use our limited resources to achieve them. There are no strategic themes around which departments can build their operational plans. There is no new thinking. There’s nothing.

When I complain to the Mayor, he says, “I have a plan, just not one you like Dan”. “Really”, I say, “Could you email me a copy?” I’m still waiting.

The other day it hit me between the eyes how bad not having a plan can be.

Great cities are made by bringing creative people together. This isn’t a new thought and it’s been crystallized for me recently as I read the Richard Florida author of The Rise of the Creative Class and Who’s Your City. I’ve been thinking about what we could do in Trenton to jumpstart own value generating creative juices.

My idea was to help organize an entrepreneur’s conference in Trenton. It’s something I’d be interested in and perhaps we could pitch Trenton as a good business location.

I went to city council meeting on Dec. 13 and my hopes were dashed.

A local business owner and several other speakers were at council to complain about a rise in the business registration fee from $10 to $300. You can pay even more if you’re a more successful business. Basically our city council and administration are planning to institute a business tax. Nearby Hamilton doesn’t have a registration fee and yet Trenton is going to add a new one. We’re adding a business tax in addition to having the highest property tax in the State.

Is this part of the plan? Is making Trenton the most expensive place in the region to do business part of the grand plan?

And now for the dysfunctional part.

At this same city council meeting, our council members were confused about how and why the business tax was so high even though they approved it. Apparently the ordinance creating the tax was put together by the city clerk with consultation from the Trenton Downtown Authority. However, the Chair of the Downtown Authority, John Clarke, spoke at council to oppose the business tax.

It seems as though the tax is some kind of miscommunication. Wow!

Slapping business owners in the face isn’t all our city council has been busy doing. It seems they have been going through the city budget line by line. They’re doing this not because they want to but because they have to.

According to council members and members of the public who’ve been there, the city’s business administrator isn’t aware of the particulars of our budget. It seems as though department heads haven’t been very involved either. In other words, they took last year’s budget, which was based on the budget from the year before that and have just copied the numbers. There’s no new thought in the budget. Imagine that our city’s only important strategic document has no strategy and no new thinking. In fact, council members are finding personnel and expenses simply shifted around.

Trenton’s dysfunctional government is managing our affairs by wandering around aimlessly, with no serious forethought and without a strategic plan. Please someone email me the strategic revitalization plan that includes rehashing old department budgets and increasing the business registration fee by 2900%.

As Trenton’s low point approaches, let’s not forget that it was 20 years of previous administration that led us here. The current group has just put the final nails in the coffin.

We’re laying off 105 police officers because our municipal budget is over $200M and Trentonians already pay the highest tax rate in NJ just to contribute $70M of that amount. Contrary to popular belief, the State of NJ would pay almost that same total, plus almost ALL of our $300M school budget.

Trenton’s taxpayers are nowhere close to being able to pay for their own government. The state currently owns roughly 25% of property value in Trenton and pays over 40% of the cost of municipal and school budgets.

We could keep the police officers but our property taxes would have to go up an additional 12% or so, thereby bankrupting many of us.

How did we get here?

Its been ignorance and pride that have brought us to this point. At some point Trentonians will have to do the hard work of taking responsibility for their city. The State can be a partner but Trentonians must cooperate in good faith. We must show a plan for recovery. We need to lead.

* BTW – According to COAH’s Guide to Affordable Housing Trenton has 7799 affordable housing units (even before including Trenton Housing Authority or section 8). Readers should be aware that there are only 22,000 or so households in Trenton. This means that over 1 out of every 3 homes in Trenton is affordable housing.

This report was produced by The Fix Trenton’s Budget Committee and is reposted here
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As part of a broad Priority-Based Budgeting exercise initiated jointly between the Fix Trenton’s Budget Committee, Beautiful Trenton and Trenton Council of Civic Associations with support from The City of Trenton, an in depth survey on budget priorities has been conducted amongst city residents.

Over the last four months 202 Trentonians have completed a comprehensive budget survey either participating in person at Ward budget forums or online through a specially designed survey tool. The survey was unique in that it used actual budget numbers and asked respondents to make forced choices between taxes and spending increases or decreases in levels of service. For instance, if citizens wanted to increase the number of police on the street they had to either increase their own property tax or reduce service in other areas such as recreation or public works. It mirrored the tough choices elected officials have to make when balancing the budget.

“This is the first time such a large and in-depth survey of Trentonians has been conducted about the budget and how their tax dollars are spent”, said Carlos Avila of Fix Trenton’s Budget. He added,
“Other cities such as Philadelphia and San Jose, CA have successfully used citizen input like this to help make hard choices in spending.”

By holding forums in familiar neighborhood locations, each sponsored by a City Councilperson, the organizers were able to reach a large cross section of Trentonians. In addition, the web based survey allowed a broader response. Our sample size of 202 was enough to provide 95% confidence that our results were representative of the 37,479 registered voters in Trenton with a 7% margin of error for each answer. Nevertheless, we hope to every year improve the methodology of this exercise and attract more participation from residents.

We’ve tallied the results and found that Trentonians favor lower spending. Of the $92,000,000 in departmental spending included in the survey, respondents voted to trim the amount by $7,000,000 to $85,000,000, a reduction of 7%. The total city budget for 2011 is $205,490,000 which also includes debt payments and benefits. The survey showed that Trentonians expected this savings to result in an 8.5% decrease in property taxes or roughly $400 per $100,000 in assessed value.

The following chart shows the weighted results of departmental budgets if left to all 202 respondents.

In particular Trentonians favored less spending in the following areas.
The following chart shows the percentage of respondents who voted to increase, maintain or decrease spending by department.

Perhaps as a hint of dissatisfaction with the current political climate, 64% of the survey takers favored reducing the administrative budget which includes the Mayor’s salary, his aides and City Council. However this cut amounts to only $1,000,000. Respondents also voted overwhelmingly to withhold pay raises for city employees.

Survey takers put Fire and Police spending under pressure as well. A surprising 38% of respondents favored decreasing Fire spending and only 7% voted for an increase. Trenton Police did a little better with 35% supporting reduced police protection and 15% hoping for increases. This is significant as Fire and Police make up one quarter of Trenton’s total city budget. While roughly half of the survey participants voted to keep spending the same, the downward pressure on spending is at odds with the administration’s past priority of maintaining current levels. The study shows that the recent realization that budget levels may have to be reduced will not meet as much resistance as expected. According to comments in the survey, the “4 on, 4 off” police scheduling policy was unpopular among respondents.

Public Works showed weak support as 42% of survey participants wanted to decrease spending while only 13% favored an increase. Health and Human services also had weak numbers with 49% of respondents calling for a decrease. Several respondents commented that the County should take over Health and Human Services.

Several departments attracted pleas for increased investment.

Inspections and Economic Development received support for increased budget by 32% of respondents. This is attributed to the belief that spending in this area will lead to increased levels of investment in the city and better quality of life. Many respondents wrote in comments such as “limit affordable housing to 20% of total”, “Kill off the Miller Homes project”, “We need more market rate housing” and “Focus redevelopment in a few areas”.

A substantial 31% of survey participants favored reopening all of the Library branches. However, 51% were OK with just the main branch being open and just over 17% favored closing down the entire library system. Similarly, 39% of respondents favored increases in Recreation spending and 11% favored eliminating the department.

In addition to concerns about departmental functions, respondents left a large number of other comments about the budget.

Survey participants seemed anxious for a new relationship with the State “The state should pay its fair share” was a popular sentiment. Others felt that Trenton should “discontinue police protection in the State House district”.

Respondents were not short on additional ideas for raising revenues. Parking taxes and improved violation enforcements topped this list. Privatizing trash collection and charging more for pick-up was a popular idea. Trentonians especially wanted to tax non-residents by way of “commuter taxes” and increased fees on non-resident landlords. Enforcing laws was also seen as sources of income through fines for loitering, increase court fines and using drug seizure money for community benefit. Other ideas included running a Police Academy for profit, an entertainment tax, a wage tax on non-profits and selling the Marriott.

The results of this survey are illuminating. They show a willingness to sacrifice but more importantly show that Trenton residents have specific priorities in how they would like their government to invest its scarce resources. Both the Mayor and City Council have supported this effort so Fix Trenton’s Budget and Trenton citizens look forward to the incorporation of these results in the 2012 budget.

Written for the May 2011 issue of the Trenton Downtowner
In a democracy citizens get to rule themselves. We elect representatives who are responsible for doing our bidding. The theory of this republican form of government is great; however there’s often a disconnect.

We forget that democracy was invented thousands of years ago when governments were smaller and simpler. That changed as Trenton and the rest of America became part of a national and global economy.

We didn’t keep up and now one of the great challenges of our age is reinventing post-industrial cities like Trenton.

Why should we expect our leaders to know what’s needed to turn Trenton around? They haven’t done it in the last 20 years. Instead we have declined in population and lost ground in income. Perhaps the collective wisdom of voters could provide better insights.

You might say, “They don’t listen”. Well perhaps we haven’t delivered a clear message.

Unfortunately most citizen input is undisciplined. Everyone wants everything: libraries; more state aid; more development and less crime. Governments and our economy don’t work like that. There are no magic wands.

We have to use our budget as a strategic instrument of revitalization policy. It’s not enough just to reduce the budget. It needs to be used wisely to further our goals of investment, safety and standards of living.

We need to balance investment in livability (safety, trash pick-up and social services) with investment in the future (lower taxes, improved technical inspections and marketing.)

We can’t just wait for a revitalization savior to show up in Trenton. Instead, we can leverage the wisdom of the masses to help make the tough choices that political leaders can’t make themselves. Priority Based Budgeting provides an opportunity to do exactly that in Trenton.

A group of fiscally minded Trentonians organized the Fix Trenton’s Budget Committee to work on efforts important to revitalization. One of those efforts is a budget process that includes citizen input as its driving force. Led by Carlos Avila and Bob Lowe we got the Mayor’s and City Council’s support to do this starting in the fiscal 2012 budget (beginning July 1, 2011.)

With Beautiful Trenton and the Trenton Council of Civic Associations and council members: we held community input meetings. To make sure we collect as much input as possible, we’ve put the survey online and will keep it open through May.

The output of the surveys will form the basis of a position paper for city council that will communicate its budget guidelines.

The Priority Based Budgeting process allows citizens to present their own budgets. People’s priorities are different. Some want lower taxes (we have the highest tax rate in NJ). Some want more services. Others want more investment. We all want these things but we have to balance the budget and now voters can make the same tough choices as our leaders.

We’ve prepared a survey that presents the budget in a simplified form. We ask you to vote on discretionary items. These include our tax rate and the department spending which directly impact the levels of service that can be provided. We held the items that are beyond our control like state funding, debt service, employee benefits, grants etc constant.

Choices include two or three reasonable levels of spending and several different tax levels. Dollars are converted into points that make the math easier. But the spending has to equal the income.

The budget survey can be found at FixTrentonsBudget.org. This is our first year using this process and we look forward to continuous improvement.

In addition to the budget survey, there’s also a questionnaire asking for your opinion on new revenue enhancing ideas. For your convenience there is also a Spanish version.

It’s our budget and we all have to be responsible for it. If we don’t do it, who will?

No matter what you hear from boosters selling you rose colored glasses or what you hear from detractors who think everyone who visits the Capitol City gets shot, Trenton’s economic situation is bad.  Our per capita income is about half the average for New Jersey as is our assessed property value.  We can’t afford our own municipal government, much less our schools.

We’re overburdened given our size and even with state and federal aid, our tax rate is high. The plain truth is that our tax rate for 2011 will be the highest in NJ.  In this regard, our property tax is definitely, “foe”. Read the rest of this entry »

Trentonians have been kept in the dark for far too long about our city’s budget and economy.  Oh sure, administrations have done their perfunctory job of presenting numbers to the city council and the papers have carried a story here or there.  But no one’s ever explained the problem.

This coming Monday, February 7 that all changes. Read the rest of this entry »

Ten years ago the Palmer administration decided Trenton needed a full service hotel.    With the help of a group of boosters, including local businessman Shelly Zeiger , the administration shopped the idea around to investors. No one bought.  That didn’t stop this group.  They convinced the city and the state to fund a $46,000,000 hotel with a Marriott brand. 

The city effectively owns the hotel and manages it through a non-profit entity called the Lafayette Yard Community Development Corporation (LYDC).    The Mayor appoints the board and during the Palmer administration it was largely controlled by the city business administrator.  Read the rest of this entry »

While at the November 23rd City Council meeting I noticed, buried in the back of the ordinances section of the docket, some details that show our government is not yet focused on Trenton’s economic recovery. 

Most budget-minded Trentonians bemoan the high proportion of tax-exempt property in Trenton due to our status as a state capital.  Not only do we house a large number of tax-exempt government buildings but we also house tax-exempt buildings owned by non-profits.  Non-profit organizations tend to cluster in state capitals and in urban areas.  We also know that Trenton’s heavy proportion of subsidized low income housing has added to our cost structure without a corresponding revenue benefit.  Trenton outpaces all other Mercer County towns in low income housing combined.  As a result, our population can’t afford to support the services we all want. Read the rest of this entry »

Gov. Christie’s “money with strings” approach to giving charity to NJ cities (and Trenton in particular) is to be applauded.  Our democratic form of government requires clear distinction between the roles of government at each level (city, county, state and national).   When funds are intermingled and distributed between levels as they have been in NJ, voters no longer have direct control or responsibility over their government and we get NJ politics.  NJ’s urban centers are almost totally dependent on state aid and for that reason we have no real responsibility for the actions of our elected officials.  The state always bails out Trenton and the others. Read the rest of this entry »

In normal times, in normal cities, budget prioritization isn’t really a big deal.  Political factions will scream and yell for their interests to be accommodated.  In a complicated dance of political give and take eventually budgets get done.  

For the most part, even if budget items don’t yield their promised results no one really cares because the basics were covered.  The trash still got picked up, schools didn’t close, the police responded to calls and property taxes are still a fraction of the cost of home ownership. Read the rest of this entry »