No Virginia, the Mayor Did Not Lower Your Taxes.

[Disclosure: This blog is written from my perspective as both a candidate for a seat on Gloucester Township Council and as a concerned citizen of Gloucester Township with questions and concerns about reckless spending and business as usual in Gloucester Township.]

Let’s move on to the actual topic under discussion: taxes. This young gentleman stated that Dave Mayer had actually lowered his taxes and the taxes of his neighbors so, millions of dollars of debt and all, he seemed to be quite happy with the state of things.

I don’t know what actual conversation this man had with the mayor about taxes but I hope the mayor didn’t actually allow him to think that he lowered his taxes because that is not true. The mayor cannot lower his own taxes, my taxes, or anybody else’s taxes; he knows it, I know it, and now you, the reader, know it.

A short primer on taxes is in order. Taxes can only go up or down in two ways – 1. The tax rate is raised or lowered, and 2. The homes in the taxed area are reassessed.

1. Tax rates are a result of the tax-ratables in any given area. A budget is passed and the tax rate is based on the revenue required by that budget and the assessed values of the tax-ratables in the taxable area. If a given tax rate does not bring in the required revenue the tax rate has to be raised. If more than enough revenue is seen to be raised a tax rate can be lowered (seldom happens). What can’t happen is for the assessed values to change unless there is an area-wide reassessment. If the rate goes up, all taxes go up accordingly. If the rate goes down, all taxes go down accordingly. That’s the simple explanation.
2. The second part of taxes is the ratables – land and improvements (houses). The problem here is that after an assessment is completed the assigned values cannot change unless a reassessment occurs or some other special circumstance intervenes which I will get to in a bit. Why did I refer to this as a problem, because a standing home usually gains value but the assessment does not change. In order to raise more revenue the tax rate has to be pushed up and nobody likes that. In the meantime, as new houses are built, those houses are assigned value closer to their actual worth at the time of building but suffer under the same high tax rate. Older homes thus are taxed at values reflected in the last assessment, say 12 years ago, while the new homes are taxed at more realistic values. Again, the simple explanation.

What to do? Every twenty years, or so, a reassessment is carried out to attempt to bring everything into balance. At that point, older homes will usually see a tax increase as the assessed value is updated and brought to a more realistic level. Newer homes might stay the same or see a tax decrease. In the end, the object is to attempt to assess all home values nearer the real market value and bring the tax rate down. Lower is better and taxpayers are usually more tolerant of a higher assessed value than a higher tax rate.

So, what happened that could bring someone’s taxes down? I called the tax assessor’s office and asked if situations occurred where the assessor’s office would say, “Opps, we screwed up. We assessed that area too high.” In fact, a rep of the assessor’s office told me that a certain area, or areas, had possibly been assessed too high. There had been too many short sales and it was determined that the houses in said development were thus assessed too high so a blanket lowering of home values occurred in that area thus answering how my new found friend and his neighbors had their taxes lowered.

If your taxes went down the mayor had nothing to do with it. In fact, if your taxes went down this year you might question why it took so long because the reassessment occurred in 2009.

Now what? Well, with over $100 million dollars of debt, something will have to be done to rein in spending and deal with the debt. One thing is for sure, I don’t think my friend will see his taxes come down anymore. In fact, he might wonder why he was overtaxed for two years before the devaluation of his home by the township.

No, my friend, Mr. Mayer did not lower your taxes and if he allowed you to think that, well, then Mr. Mayer owes you an apology and is not your friend.  If you’re okay with the millions of dollars of debt we carry, I pity your children and grandchildren.

Below is the “overall tax rate” (all taxes excluding fire district taxes) for the years 1997 through 2013. As can be seen there were only two years (1998 and 2008) that had slight reductions that were more than made up for in the very next year. The reassessment was conducted in 2009 where all assessed values were adjusted (most upward) and thus the lower rate. As can be seen, there have been no tax reductions since the 2009 reassessment thus any tax decrease realized was due to the fact that homes in certain areas were deemed to have been assessed too high.

On November 5th, VOTE Gloucester Township FIRST – Brown, DiBartolo, Kline and Pauli.

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