Hoboken featured on Bloomberg News


With property taxes sharply increased and job-losses now even affecting previously “immune” Hoboken, I wonder what the near-term Real Estate outlook is for our fair city?

Hoboken’s 47% Tax Rise Sparks Exodus Talk in Manhattan Option
The blue property tax statement Andrew Sapira received in the mail last month from Hoboken, New Jersey, has him questioning whether the city billed as a lower-cost alternative to Manhattan is worth it.

A state monitor, installed after city leaders failed to agree on a budget, ordered a 47 percent increase in property taxes for the 40,000-population community across the river from Wall Street, widely known from its portrayal as a blue-collar shipping port in the Oscar-winning 1954 film “On the Waterfront,” starring Marlon Brando. Payment is due today.

Sapira, a 40-year-old doctor who lives in a four- bedroom brownstone on Garden Street, said his annual tax bill for city, county and school services will jump to about $21,000 from $16,000. The married father of two says he may have to move from the city he loves for its restaurants, night life and proximity to New York.

“That’s a shame, because it’s great here,” Sapira said outside the tax collector’s office in city hall last week after making a payment.

Hoboken, cited in a Business Week and policymap.com study in September as among communities most vulnerable to a Wall Street decline, is a favorite of young professionals. One-third of residents were 25 to 34 years old in 2000, compared with 14 percent for New Jersey, according to the city’s master plan.


New Developments

Renovated brownstones and new construction within the city’s one square mile (2.6 square kilometers) boundaries have drawn the rich and famous, including Governor Jon Corzine and New York Giants quarterback Eli Manning. The Maxwell Place waterfront development the governor calls home markets three-bedroom units for more than $1.1 million.

The property tax increase hits citizens at a time when New Jersey’s unemployment rate is at a six-year high and with 60 percent of residents telling Quinnipiac University pollsters last month that they are financially worse off than a year ago.

“Businesses are having a hard enough time with the downturn; this is salt in the wounds,” said Stephen Kilnisan, 58, who owns Traders of Babylon Fine Jewelers at First Street and Willow Avenue and will pay $4,000 more to the city this year. “The timing couldn’t have been worse,” he said.

The new rates put Hoboken above the average in New Jersey, which had the highest such levies in the country last year. City residents paid an average $5,780 in property taxes in 2007, compared with $6,796 statewide, which was 5.4 percent higher than 2006 as local governments raised their take to cope with less state aid.

Read the rest at Bloomberg – or after the jump…

(Hoboken on Bloomberg, continued…)

Political Squabbles

Discontent is widespread, according to Sapira. “I blame everyone,” he said.

Hoboken’s finances suffered from political squabbles between the mayor and nine-member council even as the city boomed. New Jersey’s local finance board placed Hoboken under state supervision in September after the city missed a deadline for passing a budget for a seventh straight year.

State monitor Judith Tripodi proposed a $120 million budget for the year that began July 1, up from $93 million in fiscal 2008. The higher amount equals about $3,000 per resident. New Brunswick, a city of 50,000 in central New Jersey that is home to Rutgers University, has a budget of $72 million, or $1,449 per resident. The total amount to be raised by municipal taxes in Hoboken surged to $62 million from almost $34 million.

Increases Avoided

Mayor David Roberts, a second-term Democrat whose term expires next year, said that since he took office seven years ago, taxable real estate within Hoboken’s borders swelled to more than $10 billion from $2.8 billion.

The city has avoided “substantial” tax increases for 16 years, Roberts said, instead using “one-shot” revenue items such as selling city assets to balance budgets. Roberts, 52, blamed the council for not amending and passing his spending plan by the start of the fiscal year.

“The citizens of the city are angry at everyone; they’re angry at all the bickering and the grandstanding that has taken place,” Roberts said. “They feel that because of all the political bickering, they’re being punished. And I can’t say I disagree with that.”

Councilman Peter Cammarano, 31, said Roberts allowed $10 million more in expenditures than what the council approved in the last fiscal year and provided no suggestions for closing the gap, prompting the budget stalemate. Roberts has said the spending was beyond his control.

Angry Constituents

“You’re talking about blunt force trauma,” Cammarano said. “People are getting hit at the worst possible time and people are already concerned about the largest asset on their books, which is their home.”

Cammarano said he will pay $250 more each month to his mortgage company, which handles taxes as part of servicing his loan. While the increase, which he likens to “a small car payment,” is too much, too fast, there’s no option other than to pay, he said.

Property owners aren’t the only ones hit by higher taxes, said Nicholas Petruzzelli, a Hoboken Realtor and developer. As many as 60 percent of city residents are renters who will feel the sting as landlords pass on the increase in taxes.

Renters’ Pain

Jen Areneo and her husband, who rent a three-bedroom apartment in Hoboken, said the higher taxes will affect the size of the mortgage they can afford when they buy their own place.

“I’m as furious as everyone else,” Areneo, 31, said as she and a friend watched their children in a playground at Church Square Park.

Corzine, a former Goldman, Sachs & Co. chairman, answering reporters’ questions last week during a stop in Jersey City, said he would tell Hoboken residents “that we are trying to work with them, that we are trying to reduce the rate of growth of property taxes or even try to level them.”

Leave a Reply

69 Comments on "Hoboken featured on Bloomberg News"

7 years 10 months ago

[quote comment=”121270″]What is the deal with the website lowerhobokentaxes.com ?[/quote]

I’d say it doesn’t hurt to sign up…We need to do something, maybe between H411 and this other site we can motivate people to get involved.

7 years 10 months ago

Outsourcing merely puts another layer of management in place that is beholden to the politicians hiring the companies and makes the individual employees less accountable to the taxpayer. Individual employees can vote for the politicians, but the subcontractors can deliver their employees’ votes as well as sweetening the pot, and with less visibility than a public employees’ labor union.

Better to allow city employees to live outside the city so we don’t have the choice of (a) pay them enough to live in Hoboken at market rents/prices or (b) subsidize their housing.

Also, there should be a review of positions to see whether any can be eliminated, and I hope that Ms. Judy is doing that. One old-timer told me that 20 years before Hoboken had a beach, she found out that there was a person on the city payroll as Beach Supervisor. When she asked the person what the job entailed, she was told: I supervise the beaches. If you find any beaches that are unsupervised, then you can complain.

7 years 10 months ago

[quote comment=”121279″]Does anyone see anything about cuts in services rather than just raising taxes? I certainly don’t.

We should be talking about ways to reduce expenditures on city services. Garbage collection should be outsourced. The crosstown shuttle buses should either be reduced or eliminated. Hoboken Housing Authority should be outsourced. Early retirements should be encouraged.

Other ideas?[/quote]
Operational audits of all depts. and services are currently being performed by the Div. of Local Gov’t. Servises, DCA, NJ. Retirement severence incentives are on the table but have reached a legal problem due to the city not doing things right. Prospects for clearing it up seems good – Tripodi is on the job. Waiting to see the action plan and it’s effect to help the taxpayer. 😛

7 years 10 months ago

Doom, right on about the hospital. The economic are beyond belief: hospitals everywhere are bellying up but all HUMC needs is $40 million in loans and a new $1 million / year executive and voila it’s a “miraculous recovery”. If it doesn’t fail by 2010 I for one will be shocked. I’m adding to my escrow even as we speak.

OTOH, you were “smart enough to sell all my properties (notice the plural) in Hokoken and leave the city”? 🙄 Oh please. 🙄 You’ve spent WAY to much time posting for that to be true. Fess up, my man. MR got your number.

7 years 10 months ago

Does anyone see anything about cuts in services rather than just raising taxes? I certainly don’t.

We should be talking about ways to reduce expenditures on city services. Garbage collection should be outsourced. The crosstown shuttle buses should either be reduced or eliminated. Hoboken Housing Authority should be outsourced. Early retirements should be encouraged.

Other ideas?