The Case For Common Sense In Holmdel

In 2005, Holmdel Township was able to handle its affairs and pay its bills with a total municipal tax levy of $9.4 million dollars. Since then, however, our municipal taxes have skyrocketed. In 2012, the municipal tax levy was increased to a total of $14.1 million. This is a 10.8% increase from 2011 and a 51% increase since 2005.[1] To make matters worse, the township is facing another budget deficit for 2013. This will lead another real estate tax increase unless something is done to stop this nonsense. 

Now, to be frank, our municipal taxes represent only 16% of our overall real estate tax bill. Our county and school taxes make up the difference. Therefore, life will still go on for most of us if the township has to raise taxes again because it cannot seem to find a way to pay its bills with the money we give it.  However, that doesn’t mean we shouldn’t care. My joint bank account is held with my wife, not Holmdel Township. Whether your tax bill went up only a few hundred dollars or a few thousand, we certainly should not have to give away extra money to the government if it can be avoided. Since our county and school taxes have not gone up 51% since 2005, it begs one simple question: What the heck is going on with this township lately?

Rather than hearing about real solutions to this problem, we keep hearing excuses from town hall. I often hear that the tax hikes are unavoidable and not the fault of the administration. The most popular excuse appears to blame the tax increases on the reduction in revenue from the vacant Alcatel-Lucent property as well as the decrease in property tax relief aid received from the State of New Jersey.  While it is not surprising that nobody has stepped up to the plate to accept responsibility for budget problem, the following will prove to you that the recent 10.8% municipal tax increase in Holmdel is not the fault of the Alcatel-Lucent property or the reduction in aid from Trenton.

Presently, the Lucent property tax levy contributes roughly $78,300 toward our municipal budget. At the height of its assessed value in 1997, however, the Lucent property contributed a total of $600,000 towards the municipal budget.[2] Although that is an 83% reduction, it did not happen overnight. Rather, the assessed value had been continuously eroding for years. By 2008, the value had already been significantly reduced from its peak level and was only contributing about $100,000 more toward the municipal budget than it does now. This is only a fraction of the $1.8 million dollar budget deficit in 2012. More importantly, this short fall was not first realized in 2012, but actually suffered by Holmdel and accounted for in the municipal budget in 2010. That was the year when the assessed value was lowered to its present amount of $26,651,500. In other words, our taxes were already increased by 2011 to compensate for this reduced revenue. It’s old news.

Likewise, the reduction in aid from the State of New Jersey is also not the cause of the 10.8% tax increase in 2012. There are essentially two statutes that provide meaningful aid to municipalities for the purpose of reducing property taxes; The Energy Tax Receipts Property Tax Relief Act (N.J.S. 52:27D-438) and the Consolidated Municipal Property Tax Relief Act (N.J.S. 52:27D-442). In 2007, Holmdel received $2,209,194 and $395,480 in aid from the State for each program, respectively.[3] Although the aid to Holmdel from the Energy Tax Receipt program was up over $200,000 for 2008 and 2009, the administration still increased our tax rate for each of these years. Despite aid from these two programs being ultimately cut to a total of $1,985,357 in 2010, there has not been a cumulative reduction in this State aid since then. That’s right. The total amount of property tax relief aid from the State of New Jersey for these two programs has remained exactly the same for 2011 and 2012. [4]

Accordingly, not one penny of the 10.8% tax increase in 2012 is the fault of the Alcatel-Lucent property or the State of New Jersey. If anything, we have actually realized an increase in tax revenue from these sources since 2010 because State aid for property tax relief remained unchanged and the Alcatel-Lucent property (like all of us) was subjected to municipal tax rates increases each year since then. 

So if its not the fault of Alcatel-Lucent or Trenton, then who is to blame for these out of control tax increases? That answer is simple. Ourselves. We elect our township committee. Therefore, we have the power to replace them when they are not getting the job done. So if we continue to vote along party lines without giving consideration for the impact it may have (or even worse, don’t vote at all), we are effectively telling our Township Committee that they are not accountable to us. This is why we currently have a government wasting time and resources on building a bocce ball court [5] and installing sewers where they are not needed rather than dedicating every single session to avoiding another tax increase in 2013. If we are going to stabilize our tax rates and keep the politicians from reaching into our pockets each time the town can’t pay its bills, Holmdel Township needs to develop (and follow) a long-term strategic business plan and not this year-to-year crisis management of the budget. Doing so will allow this and future township committees to restrict spending of our limited tax dollars on only those things that are absolutely necessary. 

Therefore, if you want to continue the norm of voting along party lines regardless of the tax implications, then I hope you at least get the most out of the new bocce ball court planned and any other thing that the township chooses to focus on before it fixes the budget problem. On the other hand, if you are like most people and not a hardcore political party zealot, then you should consider voting for your best interests this election and moving toward a balance of power. All five seats of the Holmdel Township Committee should not be held by just a single political party and common line of thinking. However, that is exactly what will happen if my Republican neighbors choose to vote along party lines this election. It is also what will happen if my Independent and Democratic neighbors choose not to show up at the polls this November 6th. It’s time for a change. It’s time for a balance in power. It’s time for accountability. It’s time for Levinson and Luttrell. Let’s get it done.

[1] http://www.state.nj.us/dca/divisions/dlgs/resources/property_tax.html

[2] http://holmdel-hazlet.patch.com/articles/buyer-signs-purchase-agreement-...

[3] http://www.holmdeltownship-nj.com/2008%20budget.pdf

[4] http://www.holmdeltownship-nj.com/2012_Introduction_of_Budget.pdf 

[5] http://holmdel-hazlet.patch.com/articles/bocce-courts-planned-for-ackers...