I’ve been getting some questions in advance of the Board of Education meeting tonight, and thought I’d share via a post, so everyone has access. This is all public data, and we can endeavor to understand it in community. If you have a question, please email me at [email protected].
When was the BOE given notice about the budget cuts?
June 2018. JCPS’s anticipated ~$25 million cut in state aid was announced in summer of 2018. The Education Law Center reported this in June 2018: “Jersey City would have $7.5 million cut in 2018-19, followed by cuts of $36 million each year from 2019-20 through 2022-23.” I also shared this update on CivicParent in 2018, and then again in January 2019.
Was the Board of Education restricted from raising the local school tax levy in 2019/20?
No. The Board of Education was not restricted in raising the local school tax levy in 2019/20. While prior to this budget cycle (2018/19 and prior) the Jersey City Board of Education was restricted – the state imposed a 2% levy cap (barring certain exceptions) – that cap was lifted in 2019/20. NJ Spotlight reported this in June 2018, pointing to the need to lift the levy cap (the payroll tax is also mentioned as an addition means for Jersey City to raise local funds more rapidly in the face of state aid cuts):
“To help address those hardships, Jersey City — which is one of the more notable districts receiving adjustment aid — would be allowed to levy a local payroll tax specifically to raise more money for public education. But for Jersey City, the phasing out of adjustment aid would happen more rapidly, over five years. Other districts, known as former Abbotts — a name that’s rooted in the Abbott vs. Burke school-funding fairness legal case that goes back decades in New Jersey — would be allowed to exceed the state’s 2 percent cap on tax-levy increases during the seven-year phase-in period.”
My taxes are already so high. If the BOE raised the local school tax levy, wouldn’t my property tax bill then go up?
Not necessarily. When you pay property tax, you are funding three local governments: the municipality (ie Jersey City/City Hall), the county (ie Hudson County), and the schools (ie Jersey City Public Schools and public charter schools).
If the BOE decided to raise the local school tax levy, then it would have forced the city government to then either cut its expense OR pass on a tax hike to taxpayers. Tax hikes are not politically popular; but, there is also a cost with choosing not to hike taxes if there are services that must be funded (eg teachers salaries).
I created this post in January 2019 to explain the three levies in detail. It’s a bit dense, but explains the levies in detail and provides views into the three levies that are funded by Jersey City resident property taxes.
What is the $ difference between the city tax levy, the county tax levy, and the school tax levy?
$249 million/$135 million/$124 million. In 2018/19, the city tax levy was about $249 million. The county tax levy was about $135 million. And the school tax levy was about $124 million. Another way to think about these three different levies is: for every $1 paid in property tax, 48 cents goes to the city, 26 cents goes to the county, and only 24 cents goes to the schools. You can read more about these levies, and access the source budget data, in this 2019 CivicParent post. It includes this graphic which may help illustrate the levies from a birds’ eye view, and explain how the levies relate to the tax base. If you need to, click on the picture to enlarge it in a new browser window.
How much is the city proposing to increase its municipal tax levy in 2019/20?
$13 million. The city wants to increase the local municipal tax levy by $13 million. This is a screen shot of the proposed revenue summary for 2019/20, taken from the 2019/20 proposed city budget (note: public meetings to discuss the city budget have not yet started).
How much is the Board of Education proposing to increase the local school tax levy?
$12 million. The Board of Education wants to increase the local school tax levy by about $12 million. You can view the proposed budget due to be finalized on May 13th here. Last year’s school tax levy was about $124 million and the final school tax levy approved by the BOE in May 2019 is $136 million. This local school tax levy is now finalized, and cannot be changed due to state law governing the local school budgeting process.
A note: the BOE has been asserting that the $12 million tax levy increase – which is a 10% hike over last year’s levy – is a significant jump. Except it’s not nearly enough, and failure to hike the local levy more than $12 million is one reason why so many RIF notices were distributed once the budget was locked down. Here’s some background on why we needed a much bigger local levy hike in 2019/20 (and why we’ll need hikes in the years ahead).
What has been Steven Fulop’s record on abatements?
Check this map. I mapped all the abatements granted by Steven Fulop’s administration here. The map is current as of 2016. In the last two years there has been a notable freeze on the granting of abatements.
How much would existing PILOT fees pay in school tax, if they were forced to be shared with the schools?
About $42 million. I mapped out the abatement data here, and in this post showed how the approximately $40 million in school tax can be computed. Some of these abatements stretch back many years, thus illustrating the impact of PILOTs on the schools; they allow properties to avoid paying school tax for 10, 20, and sometimes 30 years.
The $42 million foregone school tax number was also shared at the April 29th BOE meeting, by Business Administrator Regina Robinson:
Is there a way to avoid hundreds of layoffs in JCPS at this point? What are the district’s options now that the school tax levy is finalized?
Yes. The city (ie City Hall) can certify funds that are currently allocated to the municipality to be allocated instead to the school district. The municipal government has the authority to transfer these funds. Funds that can be certified include the payroll tax, as well as surplus monies (the city currently has a $35 million surplus balance in the 2019/20 proposed budget), and additional monies such as potential PATH settlement funds (which has been cited by Council President Lavarro in open public meetings as possible funding source for the schools).