$9,585,000 of the $14.7MM Tax Surplus Used to Reduce Taxes in 2011

Nick's presentation on FY 2011 -  Here is the link to Nick's presentation on from the March 2nd Council meeting.   http://www.ustream.tv/recorded/13053527 .  He gives a nice executive summary and walks you through the numbers.     Go to minute 19 to hear Nick's executive summary of the operating and extraordinary expenses that this $101MM budget, $54MM tax levee budget does.   Below is the presentation itself so you can see it clearly. 

It's 10% below the 2010 Fiscal Year Budget. The 2010 FY budget did NOT budget for over $5MM in tax appeals which comes out of the tax levee ie it's an adjustment to the operating budget - you can't bond for tax appeals. This means the reduction in taxes over FY2010 is actually more than 10% because tax appeals were paid in FY 2010 but not projected in that budget that is used for comparison to this 2011 calendar budget.

Of the $14.7MM left after the above mandatory deductions, $9,585,000 is used to offset items that we would have had to been raise through the tax levee - Unavoidable extraordinary expenses.  See page 6 of Nick Trasente's executive summary presentation attached here.  

The presentation is also under the Finance and Government section of www.hobokennj.org site. 

Opponents to reform are going around saying the Admin is hoarding the $25MM surplus.  They are trying to take advantage of the complexity of public finance and hope that you won't look at the detail.

Pay close to pages 5+ that goes over the surplus:  $25MM - MANDATORY deductions like giving tax back to veterans to get to $14.7MM usable.  Of the $14.7MM usable $9,585,000 was used for extraordinary expenses that would have otherwise come from the tax levee.  So, $9,585,000 of the $14.7MM surplus was used to give back to tax payers.

The difference will be used as savings for unexpected expenses and to improve our bond rating.  All of the work on the waterfront, 3 remaining pumps, termites will have to be bonded for.  Improving our bond rating will reduce our interest rate on that money.  It's like having a down payment on a mortgage.  If you have a down payment, you will pay far less on interest and surcharges than if you have no equity.

Here are the big infrastructure items.  All but the Outdoor space is IMO, unavoidable.  We have collected monies in an open space fund that cannot be used for anything else:

• $20MM - Waterfront repairs
• 3 remaining pumps to end flooding around town - $14MM a piece ($42MM total)
• Termites at City Hall - Estimate underway
• City Streets not covered by the County (Hudson, 14th and some others are county roads.  The county paid for them.  Mason tried to take credit for them after they were done.  Unbelievable)
• The Police headquarters and one of the Fire Houses are in really bad shape.  
• Outdoor space - money has been collected in a special fund over the last 4 years that cannot be used for anything else but park space - the market is down.  It would be prudent to buy the land now when real estate and financing is cheap.

Here is Nick's executive summary presentation.

CY 2011 Budget Presentation Nick Trasente