Morristown mayor blames COVID for tax hike in $51.5 million budget
Asking for the public’s patience and support ‘as we navigate yet another tense year’, the mayor of Morristown Tim Dougherty on Tuesday presented a $51.5 million budget for 2022 that will raise annual municipal taxes by about $80 for the average homeowner.
“While our preparedness has kept us afloat over the past two years, our financial health continues to be weighed down by economic pressures and inflation. The reality is that city revenues have stagnated for the third year in a row, while costs continue to rise,” Dougherty, who is entering his fourth term, told city council in a 90-minute hybrid meeting.
He blamed the pandemic for steep drops in court fines and hotel taxes.
“In fact, the 2.2 cent tax increase is almost equivalent to the half a million dollars in city court revenue lost since 2019. And other revenue like hotel and motel taxes and revenue from interest hasn’t rebounded yet,” Dougherty said.
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Noting that the Hyatt Regency Morristown has been closed for most of 2021 for renovations, the city administrator Jillian Barrick said it could take another three years for hotel taxes to return to pre-COVID levels – if business travel and tourism rebound.
Without comment, the board voted unanimously to introduce the spending plan. He returns for a final vote on June 14, 2022.
The owner of a home assessed at the municipal average of $357,596 can expect their total property tax bill to increase by $85, to $10,355. Increases of $80 for the city portion and $40 for the Morris School District are partially offset by a decrease of $37 Morris County tax levy. the Morristown and Township Library the tax only increases by $2.
“If it hadn’t been for the robust construction in town and the PILOT revenues of over $1.3 million this year, we would be in even direr shape,” Dougherty said.
He referred to payments in lieu of taxes from projects such as the Modera 55 apartments. PILOT agreements are controversial because they increase municipal revenue by eliminating the payment of school taxes by developers.
In a curious twist, Morristown landlords will pay more in municipal taxes even though the town is under the state’s 2% cap and operating — and its total budget is slightly lower than last year. According to Barrick, the decline in net income reflects the decline in revenue.
Although wages are rising by less than 2%, she said, the city is grappling with steep increases in health insurance and pension costs. Low interest rates, meanwhile, have produced minimal returns on municipal investments, she said.
Legal costs are up due to increased litigation and the replacement of in-house legal departments (City Solicitor Vij Pawar left last year for a judging position) with contract help, Barrick said.
Court revenues for 2022 are expected to be just over half of what they were in 2019, pre-COVID. Same for hotel/motel taxes.
A pandemic bright spot: The virus has pushed many people outside – and into the city pool. Memberships and revenue have reached new heights. However, they are still not covering operating costs as competition for lifeguards has driven up wages, Barrick said.
Insisting that there is “light at the end of the tunnel”, Dougherty said PSE&G and the water utility should complete the massive replacement of underground mains and pipes this year. Improvements are coming to the pond and pavilion at Burnham Park, Granby Park (new bathrooms) and the new park on Speedwell Avenue near Modera (awaiting a sculpture), he said.
Deloitte is accelerating its arrival at its new Morristown headquarters in late spring, and a roundabout that is part of it M station the redevelopment, is expected to be completed this year, Dougherty said. National Bank of the Valley the national headquarters, slated to open next year, “is a fully taxable project,” he added.
The mayor expressed “cautious optimism” about the redevelopment of North Park Square and historic Morristown post office, two areas that “has been languishing for far too long”. He said Rep. Mikie Sherrill (D-11th Dist.) Seeking funds to control flooding at Lake Speedwell and Lake Pocahontas.
He also promised more vigorous enforcement of municipal codes, warning homeowners to properly maintain their properties.
- The school budget represents about 50 cents of every local tax dollar; the city is about 37 cents, the county just over 11 cents, and the library 1.5 cents.
- Morristown tax rates are assessed at nearly $2.3 billion, up $3 million.
- The city employs 192 full-time people.
- Public safety—police and fire—receives nearly a quarter of city spending; insurance, public works, public administration and pensions come next.
- Health insurance costs increased by 6.5%; a pair of pension bonds are up 13.6 and 6.3 percent, respectively.
- The city’s $44 million operating fund is down 1.5% and its total of $51.5 million is 1.3% lower than 2021.
- The budget is nearly $406,000 below the state’s 2% property tax cap.
- About 58 percent of the city’s revenue comes from the tax levy; surpluses, state aid, subsidies and other sources provide the rest.
- Since 2001, the state has diverted nearly $22 million in energy taxes from the city, the equivalent of $351 for the average homeowner, according to city calculations.
- Approximately $2 million is budgeted for capital projects; the lion’s share goes to roads and engineering.
- The city’s debt is just under $28.5 million; net debt has decreased by 36%, or $16.3 million, since 2010.
- The sewer utility has about $2.4 million in debt, which Barrick says will be paid off in two years.
- Morristown is allocating $3.8 million in surplus funds to this budget. “We cannot continue to erode our fund balance,” Barrick warned; the surplus has fallen from nearly $15 million in 2015 to just under $10 million in 2022.
IN OTHER CASES
Andre Harris implored council to remove a barricade from Clyde Potts Drive which he says is impeding emergency access to his grandmother and other council housing residents in the flood-prone village of Manahan.
“Every time it rains, we are cut off from everything. It’s really hard to get into it,” Harris said.
“I know you can’t move mountains overnight. But Morristown has to help Manahan Village win,” he said, describing the community as “the heart of Morristown.”
Another resident called to find out why the reflecting pool at the Tony Vail Mansion is empty.
Council approved the minutes of an October 2016 meeting, left unfinished by a former town clerk, and gave preliminary approval to the Morristown Partnership budget. The organization oversees the town’s Special Improvement District, promoting the town center through streetscape projects, a farmer’s market and festivals on Morristown Green.
Advisor Toshiba Fosterliaison with the Partnership, said the companies had voted for the return of the jeweler Bill Braunschweigerarchitect Jeff Rawding and banker Kim Ryan on the board of directors of the partnership. Leia Gaccioneleader and owner of southern restaurant + american pineand lawyer Robert Nich were also elected for three-year terms.