Posts Tagged ‘New Jersey’

Building parks is what politicians do when they simply don’t know what else to do.

Imagine you’re in charge of a “down on its luck city” with high crime, low income levels, bad schools minimal industry and population loss.  You have only $1 dollar, no make that $20,000,000 left to spend.   The question is, on what do you spend that one time only $20M?

Hmmm …..

If you’re an observer of successful urban revitalization maybe a few things would come to mind:

• How about a stimulus package for urban homesteaders that would attract investment?
• How about site development for a light manufacturing facility?
• How about a big investment in technology and surveillance for the police including body-cams?

All seem worth a thought.   But they have one problem in common.  They aren’t parks.

People love parks, or at least the notion of a park.  Perhaps we have fond childhood memories of playing in a well-kept park with mom and dad.  Perhaps, we remember playing baseball or going on a picnic.

Parks are like catnip for residents that don’t know any better.

“People do not use city open space just because it is there and because city planners or designers wish they would.” Jane Jacobs, The Death and Life of Great American Cities

Parks take regular expensive maintenance.  Parks are magnets for drug dealers and prostitutes.   Parks use up land that could be converted to taxable property.  Unless a lot of operational funding is thrown at a park, it’s at best a drain on a city’s finances and at worst a breeding ground for everything wrong with a city.  Parks are what we should do after we’ve achieved some revitalization success.

Parks are what politicians build when they don’t know how to do real revitalization and when they know they’re citizens can be fooled.

That’s what’s going on in Trenton.  Gov. Christie says new Trenton park ‘first step’ to reconfigure Route 29

Faced with his last year in office and in collusion with a governor also in his last year in office, Mayor Jackson realizes that he can’t point to much that’s moved the needle in Trenton.   Instead, he’s lost or wasted millions of taxpayer dollars.   So, what to do?  Build a park or maybe two.

There are a large number of Trenton residents that will immediately reach for their rose colored glasses and think back to pleasant childhood memories to convince themselves that, yes, absolutely, a park will turn Trenton around.   New residents hoping to build new $300,000 homes will flock to Trenton because of our parks.   Criminals will be repulsed by the beauty of the new park and will immediately forgo a life of crime, go back to school, get straight As and find a well-paying job.   That’s what parks do.  The power of parks.

If parks were the linchpin of our Mayor’s overall grand plan (not that anyone believes that) then why hasn’t he shared it with the public?  Why didn’t he base his campaign on it?   Parks were never part of any plan, they just sort of came up and he said, “yeah, sure, then the people will think I did something positive”.

It’s just the opposite, Trenton is taking money out of the “political capital” bank and instead of investing it in to trans-formative initiatives, wasting it on parks.

Historically (before Mack and Christie) the state funneled four main sources of revenue to Trenton:  Capital City Aid, CMPTRA, PILOTs on State Buildings and Energy Tax Receipts.

Two of those sources, CMPTRA and Energy Tax Receipts, are meant to be pass-through payments the state collects from corporations on behalf of every city in NJ.  CMPTRA includes business taxes (but in the case of Trenton also included some ill-defined PILOT payments). Energy Tax Receipts are paid from utility company fees.  It turns out that the State has been shortchanging cities across NJ for many years in both of these revenue streams.  Neither of them have transparent funding formulas.  The NJ League of Municipalities has taken the State to task over this but Trenton has been silent up until now.  Support for A-2753 to end diversion of Energy Tax Receipts is especially important.

There is no very accurate measure of the level that we have been shortchanged but experts in Trenton estimate the amount to be in the millions.  The next Mayor of Trenton will add his voice to those of other municipalities in formulating a better mechanism for transferring the money that rightly belongs to the cities.

The State discontinued the Capital City State Aid program in 2011.  It was essentially replaced with Transitional Aid though, at a lessor amount as you can see in the revenue charts below.    Capital City State Aid was a very undependable source of funding because it had no formula and was supplied through a yearly act of Legislation.   Obviously this Governor has decided that this outright grant is untenable.  I agree with him.

Transitional Aid was meant to be transitional, a gradual decrease in State funding with a lot of conditions monitored by the Dept. of Community Affairs (DCA) but really, the State wanted a plan to revitalize the city, a plan that it never got.  All of us in Trenton are aware of how that has gone under the Mack administration.   Because DCA and the Governor couldn’t trust our former Mayor, funding was cut and the restrictions became tighter.

The final form of funding is what’s most important for our future relationship with New Jersey.  Several State owned buildings in Trenton have had negotiated PILOTs with the City.  There is no rhyme or reason to this other than it was a mechanism in which to transfer additional funding to the City for various reasons.  Only a handful of State buildings have PILOTs.  The total amount comes out to about $9M.   This is an ad hoc approach to funding.

No State in the U.S. has any obligation to pay a City anything.  Governments can’t tax each other.  However, many States understand that especially in Capital cities the state is a major property owner and employer and must behave more like a corporate landowner.   I propose that we formalize this approach through negotiation and State legislation to generate a funding PILOT based on either the assessed value of State land in Trenton or the proportion of land owned by the State.   The Fix Trenton’s Budget group has analyzed this issue by examining the city’s tax rolls and report that the State of NJ owns roughly 19% of all property value in Trenton.  However, we have reason to believe these values are under-assessed by quite a bit (perhaps 50%).   Additionally, the State owns about 28% of the acreage in the City.

The question is, if the State were taxed like a corporation, what would it pay?

Let’s say that after a reassessment the State is found to own 30% of the land and property value.  Total values in Trenton are roughly $4B.   Our current tax rate is 3.85%.  Therefore the State could theoretically pay 30% X $4B X 3.85% = $46.2M.   This is more than it pays today in Transitional Aid and PILOTs (roughly $32M) but less than it did in 2010.   This is a good formula.

Trenton is in a dire situation though and we do need the State of NJ’s help in recovering from this.   Our next Mayor will do well to ask for State assistance in many areas mainly around legislative relief to overhaul our tax system and create incentives to invest in Trenton.   In the meantime we will request that Transitional Aid be maintained until our economic plans can begin to bear fruit, likely 4-5 years.

Jim Golden’s Trenton Forward plan is unique in that it includes a detailed plan to revitalize the city that specifically seeks to rid us of the need for transitional aid as long as our funding formulas can be formalized.   The BIG goal in that plan is to make Trenton much more self-sufficient.   Our lack of self-sufficiency puts us all at risk because our budgets will be uncertain.   We’re entirely too dependent on the whims of a Governor or Legislature.

Trenton Revenue Source Comparison

Source:   Trenton City Budgets, Fix Trenton’s Budget.

Trenton Forward “Asks” to New Jersey: Beyond the Funding Formulas

• Support for consulting project to define and implement Best in Breed
• Seek a Land Value Tax capability to replace PILOTs and Vacant property registration fees
• Allocate $50M to a Residential Investment subsidy over 10 years
• Enact enabling legislation for Income Tax Credit Zone that caps state income taxes in Trenton
• Continued funding for temporary police assistance

In this political season it’s useful to point out what may be the most racist proposal put forth in New Jersey since city-wide school desegregation. It is the “Fair School Funding” bill and comes from Senator Mike Doherty of Hunterdon County. He probably would say he’s thinking about all New Jerseyeans. Yet, he’s proposing a policy that would push our state backwards from schools that are “separate but equal” (a poor starting point), to “separate but unequal”, where much of the South was in the 1950s.

Desegregation in our state was done on a city-wide basis, unlike in southern states which were integrated at a county level. The differences in effects are stark. Southern schools achieved racial integration because county districts limited white flight. In New Jersey, white families simply moved over a city line and created their own new racially segregated school districts, like West Amwell, Hamilton, and Ewing.

As a result, New Jersey has 590 school districts for a population of 8.7 million people while North Carolina has 115 districts for a population of 9.4 million people. This is how schools became comparatively “separate”.

This system of city-wide integration gave rise to New Jersey’s current level of segregation, which ranks the state as 12th in black-white segregation and 6th in Hispanic-white segregation according to a study at the University of Michigan based on US Census data.

The 1985 “Abbott vs. Burke” decision by the NJ Supreme Court further adjusted New Jersey’s educational landscape. It mandated that poor districts receive equal funding to rich districts. This is how schools became “equal”.

For those who aren’t students of civil rights history, the US Supreme Court ruled in 1954 that “separate but equal” wasn’t good enough. While school systems across the country and particularly in the South resisted integration, forced school busing in these new county-wide districts, in many ways saved southern cities from the white flight that drained resources from their northern counterparts. It was a blessing in disguise.

Rather than propose ways to finish the job of racial integration in New Jersey, Senator Mike Doherty of Hunterdon County proposes to gut our “separate but equal” system of educational apartheid and replace it with a “separate and unequal” system.

Senator Doherty’s plan is called Fair School Funding. It seeks to equalize school funding from the State to a formula that equates to $7,400 per student no matter what school system that student lives in. In Senator Doherty’s PowerPoint presentation, he compares West Amwell (which is mostly white) to Asbury Park (which is mostly black). In his example, West Amwell would receive an additional $6000 per student from the State while Asbury Park would lose $17,000 per student. West Amwell could then spend $20,000 but Asbury Park could afford to spend only $10,000.

In the presentation given to a West Amwell Town Hall meeting, Senator Doherty uses a particularly “high handed” statistic that says 85% of school districts will get more money. However, I suspect that 50% of students will benefit and 50% will not because the large urban districts like Newark, Trenton and Asbury Park would be the losers.

The Fair School Funding web site is very well done and happily reports how much money every school district in the State would gain or lose. Trenton would lose over $130,000,000 (about 45% of its total) and Newark would lose over $370,000,000. Meanwhile, Princeton will gain over $23,000,000.

It takes a lot for me to call a thing racist but this plan just is. It’s based on the notion that it’s good that our schools are separate and furthermore that children in New Jersey’s poor (mostly black and Hispanic) districts don’t deserve the same public education afforded those in wealthy (mostly white) districts. If it weren’t, Doherty might have a Trenton or Newark co-sponsor to explain why property taxes would have to triple in those cities to make up for the loss in funding.

I fully expect Senator Doherty to trot out New Jersey’s Home Rule laws to defend his bill, much like George Wallace used “states rights” arguments to defend racial segregation. America has moved forward, leaving New Jersey behind, and now Doherty wants to take us all the way back to 1954.

Neither a State nor a civilization should want to institute a radical plan like Doherty’s Fair School Funding as it would effectively close urban schools. This proposal is like a “final solution” to the black and Hispanic urban populations.

If nothing else, this proposal shows how messed up New Jersey really is. The fact that a State Senator is proposing this should concern us even more. Senator Doherty needs to be called out. He apparently hopes to rise in the Republican Party and seek state-wide office. This should not happen.

It’s clear though that New Jersey needs to rethink how it wants to govern its society in order to overcome the fear and loathing that has bred Mike Doherty.

It’s fine to think that Asbury Park and Trenton need to do better at running their cities, they do. But really, other forces have caused West Amwell to be like it is and Asbury Park to be like it is. None of those forces have anything to do with how those cities are currently managed.

There are better ways to deal with schools and school funding and I call on Republicans of good will to lead the charge for a better New Jersey.

I’ll offer my counter-proposals.

New Jersey needs to fix its social fabric before the economic fabric of its cities and suburbs can work well together. The people of New Jersey need to reject segregationists like Doherty and embrace the goal of twenty-one modern, efficient and integrated public school systems.

References

Fair School Funding web site – http://www.fairschoolfunding.com/

University of Michigan Institute for Social Research – http://www.psc.isr.umich.edu/dis/census/segregation.html

The elephant in the room when it comes to revitalization is schools.  Everyone knows it but most are hesitant to talk about the real underlying problem. Read the rest of this entry »

A popular New Jersey Gubernatorial campaign promise this year (and the last campaign as well) is to offer property tax rebates. Voters should think seriously about the wisdom of this. Read the rest of this entry »