The Hoboken Tax Reform Coalition

Michael Lenz Answers Questions Submitted by the Public for the Budget Workshop.

Although he labels this "Interim Answers to Revolt from Michael Lenz", these were questions that were submitted by the public, not official questions asked by Hoboken Revolt, in prep for the Budget Workshop.

These are answers coming from Councilman and Finance Committee Chair Michael Lenz himself and to my knowledge were not discussed among the Finance Sub-Committee nor the Council as a Whole.

His answers are embedded in bold within each question. I post them here for all to survey. Thanks, Donna

From: Michael Lenz
Date: Wed, 03 Feb 2010 07:21:53
To: Donna Antonucci

Subject: Interim Answers to Revolt from Councilman Michael Lenz

1) Does the budget contain sufficient funding to
initiate/continue/complete a comprehensive revaluation of all Hoboken
real estate? Not as it was introduced.

How much is the revaluation going to cost and how long will its
completion take? Tax maps will cost up to $300,000 and are a required first step. I expect to see them in the adopted budget this year. The reval itself could easily cost over $1 million, will take in excess of a year, and the
cost can and should be spread over several years.

2) Does the budget contain sufficient provisions for the massive
property tax refunds expected based on tax appeals as a result of
continuously declining real-estate prices in Hoboken?  No, or at least
not directly. The likelihood of such shocks in future years is part of
the justification for my position we should face costs such as the
$4.2 pension liability (once we have confirmed the amount) now and not defer them.

What are the estimates implied in the budget for the Hoboken
real-estate values going forward (additional decline, stabilization,
increase) and what are the assumptions for the percentage of property
owners who will successfully appeal their property taxes?  Budgeting
does not really touch on these issues except as discussed above.

3) Does the budget reflect full payments by all PILOTed buildings in
Hoboken in accordance with their respective PILOT agreements?  I have
been assured by the Director of Finance that it does.

Is Church Towers now in compliance with the stipulations of the PILOT
renewal agreement by signing on to an appropriate state program? If
not, will the CT PILOT be revoked? Are any other PILOTs about to
expire? Good questions. I defer on the first and third questions to
the Mayor and Director of Finance. As for the second, if the property
is and remains in non-compliance I believe that option should be
explored.

4) What measures have we taken to ensure that Church Towers is being
managed in accordance with the February 2009 resolution? Has the
Council or the Finance Department received any kind of reporting? Can
the building managers produce the waiting list(s)? Do we know if the
building managers are ensuring that all of the income of those who
resides in the buildings above the age of 21 are being considered when
determining if a household has to pay the surcharge? Is there any
independent auditing occurring? Are those audits available?  I defer
on this question to the Mayor and a Director of her choosing. Can the
Council order those audits or do we have to work with the DCA to have
that done?  I don’t know. Once the budget is adopted I will work to
see the issue is explored.

5) Does the budget reflect any city personnel reductions (city hall,
HPD, HFD) so far? Are any lay-offs or furloughs planned during the
remainder of this fiscal year and beyond and how much will be the
resulting savings? Some in the introduced budget, and there will be
more to come.  As introduced, it contained very few or none. The
Mayor is working to provide the substantially completed Police Audit
and to develop a Fire Audit to guide future decisions and the other
Directors are evaluating layoffs and/or furloughs.

6) Does the budget contain reserves for dealing with the crumbling
infrastructure in Hoboken (flooding, water front, streets, etc.)? If
so, how much? Not a substantial one. Given years of deferred
maintenance, such repairs will require bonding and is yet another
reason not to defer the $4.2 pension liability.

7) What provisions does the budget contain for the failing Hoboken
University Medical Center? Will there be any payments in support of
the HUMC operations in the budget? If so, on what legal basis?  It
contains none and is yet another reason not to defer the $4.2 pension
liability.

8) What is the impact of the anticipated settlements of the ongoing
union negotiations on the budget? They were included in the
introduced budget in the form the Fiscal Monitor in her sole
discretion estimated to be appropriate at the time of introduction. I
believe her estimates to be unaffordable, and am advocating that they
be removed at this time.  They will need to be further modified to
reflect settled contracts and reasonable expectations when the budget is adopted.

9) What specific line items will be cut in the budget to achieve the
25% property-tax reduction that was promised by this administration
during the recent election campaign? Will this 25% cut be achieved? If
not, why? The 25% property tax cut was a projection based on optimal
assumptions and limited shocks.  Neither has occurred. Shocks have
included $4.2 million in pension liability, the recognition of the
extent of the retro contract years, cost of garage replacement,
failing infrastructure, etc. As I have said before, even with
attrition, furloughs, and needed new fees, it will take both
belt-tightening and luck to stay at the 8% introduced cut, without
substantially reducing city services.

10) Hoboken Recreation program - please show fiscal years 2007, 2008
and 2009 expenditure and the number of participants. How many full
time and part time employees do we have? This was discussed in detail
in the workshop. Are part-time employees offered healthcare? No. What
did we spend in transportation costs transporting our kids to events?
I defer to the Mayor and Director of Health and Human services. Do wehave controls and measures in place that assure that we are only
offering rec program access to Hoboken kids? Not really, but during
the workshop the council called for partial coverage of costs from
Hoboken Residents, and full cost coverage from non-residents. Please describe the registration process? The current process is being
reviewed and improved by the Director. By program, please list what
kids pay to join each rec program? Currently zero, but as a result of
the workshop a fee structure will be brought forward. What was the
"revenue" from the Rec program in 2007, 2008, 2009? What were the
operating expense for those 3 years? Unknown due to poor record keeping.

11) Healthcare - Single, Couple, Families - avg size of family,
splits between medical, dental and drug. I know we have more than one
plan? What are the plans and how many are enrolled in each?  To be
discussed in next workshop.

12) What do we spend per employee including retirees on healthcare?
What do we spend per single employee? Per couple? Per family? What
is the deductible? Do employees contribute to monthly premiums? How
much do they pay for prescriptions? To be discussed in next workshop.

13) Fire - non salary and wage expense - show what was approved and
was actually spent for each year - 2007/2008, 2008/2009, 2009/2010.
Have the Police and Fire departments spent within the operating
budget? Show the months of overage and why? Show if that
overspending has gone up or down. What are the major categories of non wage related spend? Fuel, computer services, Office supplies - break down office supplies into categories. It was reported that records of this historical data are unreliable.

14) Police - non salary and wage expense - show what was approved and was actually spent for each year - 2007/2008, 2008/2009, 2009/2010. Show if that overspending has gone up or down. It was reported that records of this historical data are unreliable.

15) Police vehicle fleet number of police cruisers, number of SUVs,
SWAT bus, list all vehicles. privilege asserted by the police chief on
this. Release of data supplied under consideration. Do we still own
the SWAT bus? Yes for now. Do we have plans to sell it? Yes, for a
nominal amount in exchange for mutual aid. How much does it cost each year in upkeep and insurance? I defer to the Mayor and Director of
Finance.

16) How many "extra days" have been taken per employee on the Police
and Fire Department? What is the cost to backfill those absences?
How many sick days on average does a Police and Fire employee take on
average? How does that compare to other unions that do not have an
unlimited sick time policy in their contract? Please use the average
of the last 3 years worth of data? I have been advised that here to
fore such records have not been kept.

17) Library spending - What was the required funding based on the 1/3
mill formula? What did we actually fund? I believe we underfunded.
To be discussed in next workshop.

18) Cell phone usage - how many cell phones do we have in use as
compared to 2007 and 2008? Can you provide a list of those who have
cell phones and why they have a municipal paid cell. That is, can you
justify why we have issued a cell phone? Can you split out local v
calls made outside of Hudson County? How much are we spending on
non-local calls? Does it make sense to just ask people to use their
own cell phone and submit for reimbursement just those calls made for
business purposes? Has this analysis been done? phone? Did we
recover any money from those who hand cell phones in 2007 and 2008 who no longer worked for Hoboken? To be discussed in next workshop.

19) Petty cash by department - what was the total spent in 2007, 2008
and 2009/10 in petty cash by each department that has a petty cash
fund? Do we require receipts for items spent from this fund? Do we
require an explanation of use? Who monitors the directors to assure
that this money is being spent on municipal business or was a
justified emergency expenditure? To be discussed in next workshop.

20) Fuel Expense - What did we spend on fuel in 2007, 2008, 2009? To
be discussed in next workshop.

21) How many people do we have working on maintaining our parks? How many full time? How many part-time? This was discussed in detail in the workshop. Do we have seasonal workers? No. Are part-time employees offered healthcare benefits? No. Can you provide an org chart showing what people do in this department? This was discussed in detail in the workshop. Can we reduce staff here and have fewer workers maintain more park area? I have seen employees who are assigned to a park who don't have a full work load. I see them sitting for hours in the park so we are either not getting our monies worth in terms of cleaning the park or there isn't enough for them to do and we should be able to
reduce staff. Is there a way to get a smaller group of people to take
a larger share of the work? The Director indicated we are not in his
opinion overstaffed.

22) Have we attempted to collect the monies spent on Ms. Andreula's
healthcare when she was no longer an employee? How much did we spend on her healthcare after she was no longer an employee? Since she was no longer an employee there should not be an issue of confidentiality. If
you can't answer it that way. How about disclosing how much we spent
on healthcare since Ms. Andreula left the Council through 2009 on
people who were no longer employees? You can collect it from
a surviving spouse or go after the executor for failing his fiduciary
responsibilities in satisfying all liabilities before closing the estate. I defer on this question to the Mayor and a Director of her choosing.

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Replies to This Discussion

Permalink Reply by georgia on February 6, 2010 at 5:07pm: Thanks Donna,
It seems that there's a lot of work to be done, and a lot of questions don't have answers.
Regarding the tax appeals, the city should be prepared to get a lot more requests than last year! People who missed the deadline last year (April 1st), are ready this time; with a declining market, I would not be surprised if it will double. Time to start the RE-EVALUATION!; ▶ Reply to This

Permalink Reply by SmartyJones on February 6, 2010 at 8:21pm: Treat pension costs earned over x amount of years and pay it all out in the final six months of THIS fiscal year, treating it as an operating cost? Uh, no thanks.

You can say it over and over until the cows come home. No sale.

The pension cost is not a "shock" as it's been known by everyone for quite a long time.
The mayor's plan on the municipal garage is not known so let's wait until we can evaluate it with all the details. Fiscal State Monitor Judy Tripodi told Mile Square View there were monies put aside in the budget for retroactive increases toward Public Safety although the amount wasn't stated. So let's not pretend that's a "shock" too.

Funny, the cost of a million dollar reval is okay to spread out over several years but not a pension cost. That is consistently insisted as a required pay in full in the last six months of the fiscal year.

Okay, do the reval over years and bill it's percentage accrued for each year to completion. There's hardly any logical urgency to rushing that in a falling real estate market. That's clearly self-defeating.; ▶ Reply to This