Facts Matter: How Much will the Municipal Complex Raise Our Taxes?

Facts Matter: How Much will the Municipal Complex Raise Our Taxes?

One of the biggest – if not the biggest – issues in this election is the new Township Municipal Complex: its cost, its tax impact, and how we got here. Many residents have expressed their concern about the $32 million price tag (which is already $4 million over the initial budgeted amount) and what that means to their pocketbook. While the Municipal Complex plan is already set in stone, it doesn’t mean we should reelect the leaders who brought us to this point. It also doesn’t mean the project should be on auto-pilot. It needs strict oversight to ensure more cost overruns don’t occur, and that we maximize savings wherever possible.

If elected, we pledge to:

  • Manage this project much more responsibly going forward.
  • Hold the developer, EPIC, accountable to ensure the project is finished as quickly as possible.
  • Ensure the project comes in as much under the $32 million budget, as possible, since any savings will be split between the township and the developer 50/50.
  • Weigh wants versus needs – if there is any room to scale down, we will.
  • Listen to your concerns and consider your feedback before decisions are made.
  • Use every means of communication to ensure residents are not only informed but understand what is taking place.

How We Got Here

The current Mayor stated publicly in his letter to residents on July 25th, 2018, that the average household will see an annual tax increase of $179 to pay for the cost of the Municipal Complex. The Town Council, however, has claimed that the “actual” tax increase will only be $3 for the average household. How is that possible?

The argument made by the Council is that they will reduce the $179 tax increase by using anticipated revenue from financial agreements made with developers of other housing complexes to be built in the next few years. These agreements, called PILOTs (Payment In Lieu Of Taxes), give 95% of the taxes collected from the development directly to the Township, whereas a normal tax bill would see roughly 20% of the revenue go to the Township.

There is a big “if” with this approach, however: it assumes the developer will complete the project as proposed, and that they will successfully generate the level of revenue assumed in the PILOT agreement (in this case, having the units filled by new residents). But as of the beginning of October 2018, none of these housing developments have even broken ground! With all the unanticipated events that may impact developers, there is absolutely no guarantee that Berkeley Heights will receive the tax revenue the Mayor and his running mates are banking on.

The Power of ‘No’

The “$3 tax increase” is an estimate, not a reality. When it comes to paying for the Municipal Complex, the only hard fact we know is that it will cost $179 per year for the average household. It is not fiscally responsible to wager on a hypothetical source of revenue to lessen the tax burden. This is why Councilwoman Susan Poage voted “No” on spending an additional $4 million – because it was critical that we make every effort to responsibly manage the project. Plus, taxpayers only received notice of the exact dollar amount of the increase hours before the public hearing to approve the extra $4 million.

The Township is committed to completing the Municipal Complex, as we are. We agree we need a new facility. But we cannot elect the same leaders and expect them to avoid making the same mistakes. Nor should we forget the tangled process that got us here, including having a Council member vote on parts of this project despite having a clear conflict of interest, as noted by the courts.  Other Council members abstained because of their conflicts.

This is your town, and your tax money; we will take our role as your representatives seriously.

 

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