Holmdel Property Taxes - Part II

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OPINION

By Guest Columnist Prakash Santhana

Holmdel Property Taxes – Part II

I am writing this article to answer the questions raised by the residents and members of the BOE after my first article on Holmdel’s property taxes.

Some members of the Holmdel BOE raised the possibility of the township sharing the PILOT revenues with the BOE to reduce the property tax burden. Here are the facts related to the PILOT revenues.

There were no PILOT revenues prior to 2018. In 2018, realized PILOT revenue totaled $600,000. The anticipated PILOT revenue for 2019 was $1 Million. Rounding up, let us assume that the total PILOT revenue earned for the years 2018 and 2019 were $2 Million.

During the same period, the School district tax levy increased by $3 Million. This implies, even if we hypothetically consider the possibility of the entire PILOT revenue going to the School district, residents of Holmdel would have still seen an increase in their School taxes totaling $1 Million. (Remember that there were no increases to the Municipal taxes for the last 5 years).

We can look at the trend analysis of expenses and revenues of each school district within our cohort group of towns that we analyzed in our last article to understand the root cause of this problem. The towns we considered were Bernards Township, Holmdel, Kinnelon, Robbinsville, Summit and Tenafly.

We looked at the changes to both expenses and revenues per student for Governmental activities at each BOE between 2018 and 2019. Numbers in parenthesis are negative indicating a reduction.

The second column in the above table shows the changes in expenses per student at the BOE of each town between 2018 and 2019. The third column shows changes in revenues per student at each BOE between 2018 and 2019. The last column in the above table shows the difference between changes in expenses per student and changes in revenues per student between 2018 and 2019, in other words, a difference between the expense change column and the revenue change column. Any negative number in this column would indicate that the corresponding town either worked on reducing their expenses or improving their revenues or both.

What is obvious from the above table is that Holmdel school district stands out as the only school district where changes to expenses did not keep pace with any revenue shortfall. It appears that every other BOE other than the Holmdel BOE made a concerted effort to lower their expenses.

It is clear from the above analysis that in the absence of a significant reduction in BOE expenses, residents of Holmdel will not see a material decrease in our property taxes and any discussion of cost sharing is an attempt to shift the burden elsewhere.

Prakash Santhana

Holmdel Township Committeeman (2020- 2022)