Mayor's Annual Message

 

MAYOR ALBERTO G. SANTOS

JANUARY 3, 2014

Members of the Town Council, Reverend Connolly, family and friends, as we start the new year and as the Council and I begin our new terms of office, we come together in our shared commitment to making Kearny a better place. 

This is sixth time I have taken the oath to justly, impartially and faithfully perform the duties of Mayor.  Each time I have been humbled and inspired by those words.  I pledge again that I will continue to serve the people of Kearny with integrity and the courage to do what is right. 

As we begin a new year, today is a day of promise.  It is a day on which we rededicate ourselves to a shared vision for our community’s future.

To the Members of the Town Council, to the Town’s department heads and professionals, to the citizens who volunteer their time to serve on the boards and commissions that local government depends on, I immensely grateful that you have shared your time and talents for the betterment of our town.  We will rely on you and your dedication in meeting the challenges that lie ahead for our community.

I have often said there is a spirit of service that is at the very heart of our community and holds us together.  That service and dedication to community is shared by many residents, businesses, service clubs and houses of worship.  It has improved the lives of countless individuals and made our community a better place.  It inspires all of us. 

Organizations like the West Hudson Arts and Theater group, which literally began two years ago when several Kearny residents met at Gerry Ficeto’s kitchen table, all of whom saw the need and opportunity to bring theater and the arts to our community. They formed WHAT with the mission to be “a cultural resource that will enrich and invigorate the West Hudson community as a whole.”   In a short time span, they have put together full schedules of productions, summer arts programs and enrichment programs that have enhanced our community.

Another inspiring example is the Kearny Community Garden and the work of organizers such as Jenny and David Mach, and Ed Bixler and Peg Bixler, in making the community garden a resounding success in its very first year.  About a year ago, members of the Kearny Community Garden presented a proposal in this Chamber entitled, “Beautifying, educating and nourishing the Kearny community”.  We were immediately impressed and the garden’s first season exceeded expectations, fully achieving their mission of beautifying the community, educating the community about organic gardening, and promoting a sense of community for all Kearny residents.

That service and willingness to give back is what makes our town a community.  It provides our residents a sense of belonging and community identity.  It is why all of us work every day on a shared vision for our community’s future.   

That future is one that continues to build and invest in our infrastructure.  We will rely on Federal, State and County grant sources to invest in the town’s storm water and sanitary pumps by installing permanent generators and elevating pump station components; we must proceed with the design of an additional, long over-due, storm water pump that will alleviate flooding in the east of Schuyler Avenue neighborhoods of Devon Terrace, Hoyt, Tappan and Dukes Streets. 

We will also continue to invest in street resurfacing and replacement of water transmission lines and we will continue to improve our parks and recreational areas, with the completion of the library garden, the construction of a dog park, and the installation of synthetic turf at the Gunnel Oval fields. 

It means that we will invest in public safety so that our police department continues to make Kearny one of the safest communities in the area, with crime now at a ten-year low, and the Kearny fire department can timely respond to fire emergencies anywhere in town from the tip of South Kearny to the northern boundary at the Belleville Turnpike.     

That future must also be one in which Kearny remains affordable to live and work.  With property taxes in Kearny exceeding $9,000 a year for an average-assessed home in a community that is predominantly working class and fixed-income households, the homeowner’s tax burden is heavy. 

The Council and I must continue do our part in meeting the challenge of tax affordability in a fiscally responsible manner.  We have kept costs that are within municipal control flat through attrition of personnel and the negotiation of fair labor contracts.  Costs outside our control, however, continue to absorb too much of our financial resources.  Since my first year as Mayor, employee pension costs have nearly tripled, health insurance costs have more than doubled, and garbage and sewage disposal costs have doubled.  Those costs will add up to $23 million in this year’s budget, which is almost one-third of the total budget.

Our response will be continued fiscal vigilance, knowing that every action has a financial cost, and a continued focus on redevelopment of underused commercial and industrial properties so that we can expand our tax base and increase tax revenue, particularly in South Kearny, the Kearny Meadows and in our redevelopment zones on Passaic and Schuyler Avenue.

We will also remain vigilant against efforts to undo tax sharing in the New Jersey Meadowlands.  Without the $3.8 million in tax sharing that Kearny received from the Meadowlands district in 2013, we would not have been able to balance our budget and provide essential municipal services.  For over four decades we have assumed the tax burdens of regional zoning in the Kearny Meadows, which limited development of the area.  Any legislative changes in the District’s tax sharing law must hold Kearny harmless.

Notwithstanding our efforts, tax affordability is made increasingly difficult by State actions that reduce the financial resources of municipalities.  A municipality’s fiscal capacity is the cornerstone of its ability to provide services.  However, State law limits our ability to raise local revenue.  Local government cannot impose sales or income taxes; we are limited to property taxation, a regressive tax that is now subject to a levy limit setting the maximum amount that a municipality can raise in any given year. 

But even prior to implementation of the 2% tax cap, political reality and State law limited how much the Town Council and I could raise through property taxes.  Property taxes are particularly burdensome for homeowners because most of our Town’s tax revenue is derived from property taxes on residential property.  That is not a choice that the Council and I made but rather an outcome of the complex labyrinth of State-mandated tax exceptions for industrial, transportation and public uses that treat those properties more beneficially for tax purposes than residential properties.  Two of the largest active rail yards in the region are in South Kearny – CSX and NJ Transit – but State law provides that both are exempt from paying any property tax.  State law also exempts the County jail in South Kearny from paying any tax.  Two of PSE&G’s power plants are in South Kearny, including a new $250 million peaking facility, but State law says almost none of it is subject to property taxation.  Shipping container storage is prevalent in South Kearny but State law prohibits municipalities from taxing that use.  Highways such as the NJ Turnpike, the Pulaski Skyway and Route 1 & 9 impose demands on Kearny’s police and fire departments, and take up substantial portions of Kearny real estate, but generate zero revenue for the Town of Kearny. 

With access to property tax revenue constrained, State aid becomes an even more critical component of the revenue side of our town budget; however, the State has reduced substantially the annual amounts it provides most municipalities, including Kearny.  In my first year as Mayor in 2000, Kearny received $21.4 million from the State’s Energy Tax Receipts and Property Tax Relief programs.  This year, it will be almost $3 million less at $18.4 million.  This money from the State is not a form of public assistance for municipalities; rather, it is revenue due and owing the Kearny taxpayer because of public utilities and power plants in our town.  Historically, municipalities were allowed to assess and directly collect a Public Utility-Energy Tax.  The Public Utility tax was replaced by the Energy Tax Receipts program under with the State became the collector of the utility tax which by law is to be distributed in full to municipalities.  But the State has not passed through the full amounts and has taken municipal money for its budget.  If the law had been followed, Kearny would have received an additional $46 million from the State over the past 10 years. 

Because of these State actions, we are losing our fiscal capacity to govern.  By limiting local revenues, the State of New Jersey is encroaching on the autonomy of local government to do its job.  If allowed to continue, this will result in further centralization of State power and probably mandated regionalism from above by the attachment of strings to whatever reduced revenues are dispensed by the State to municipalities.  This will be a dramatic departure from how local government has functioned in New Jersey for the past century – since the Home Rule Act was enacted in 1917. 

The tradition of home rule is based on the principle that local self-governance is the most effective way to address local needs and concerns.  Residents know their locally elected leaders who in turn know the needs of their community better than any State authority.  There is no ‘one size fits all communities’ solution to providing municipal services like police and fire protection, or health educational programs or recreation programs or community programs at the public library.  Home rule enables diversity and initiative at the local level.  It allows communities to take prompt action to resolve local issues.  It provides a forum, this Council Chamber, for residents to directly address their elected leaders and allows citizens to become involved in the decision making process.

However, without adequate financial resources, home rule will be hollow.  Continuation on this path will erode our citizens’ basic right of local self-government, putting meaningful democracy at the local level at risk. 

If reducing the residential property tax burden is truly a shared priority by both State and local government, then the State can assist municipalities by eliminating the inequities in New Jersey’s property tax law and by addressing State requirements that affect the biggest cost drivers in municipal budgets, such as pension and health benefits for employees, and waste and sewage disposal costs.  The current State policies that reduce municipal financial resources under the pretense of fiscal austerity will not reduce the property tax burden.  Rather, they will further centralize the power of the State at the expense of local democracy.

We must fight against that outcome because Kearny is a community with its own identity and with specific needs that cannot be generalized.  We must fight against that outcome because the citizens of Kearny should control the future of Kearny. 

Each of us here believes in this town and its residents.  We believe in the vitality of our neighborhoods, our businesses, our schools and houses of worship, in the strength of our families, our diversity, our young people and our senior citizens.  We are inspired by the community service of countless residents.  We believe that when Kearny works together, we can overcome the challenges we face and that together we will make Kearny a better place. 

May the New Year be healthy, happy and prosperous.  May God bless Kearny and the United States of America.  Thank you.