Board of Education Passes $974 Million Budget: Big Tax Hike Coming

The Jersey City Board of Education narrowly approved a $973.8 million budget on Monday that will keep school staffing and operations stable in the 2022-23 academic year and raise school taxes by $134 per month on a $460,000 home.

The budget vote passed 5–4 after board trustee Paula Jones-Watson, who had originally voted “no,” introduced a motion to reconsider, prompting a second vote and changing her vote to a “yes.”

Board President Gerald Lyons and trustees Lorenzo Richardson, Noemi Velazquez, and Gina Verdibello joined Jones-Watson in supporting the budget. Trustees Younass Barkouch, Alexander Hamilton, Natalia Ioffe, and LeKendrick Shaw voted against the spending plan.

After several board members at last Thursday’s special budget meeting said they could not support the $200 per month school tax increase in the preliminary budget, Acting Superintendent of Schools Norma Fernandez and School Business Administrator Regina Robinson presented a budget with a lesser tax impact on Monday.

Reductions in overtime pay known as “comp time,” adjustments to facilities spending and operations investments, and the use of excess surplus and fund balance helped reduce the local tax levy from $483 million to $426 million.

In addition to a share of local property taxes, Jersey City schools receive funding from the state and the federal government, the latter of which is restricted to expenses such as pandemic recovery and technology.

Officials on Thursday emphasized that the budget is necessary for the continued functioning of the district and that there was little room for change without making difficult cuts to staffing. Nevertheless, by Monday they were able to slightly blunt its effect on school taxes.

“Dr. Fernandez and I talked about scaling, putting austerities in place, and making sure that we manage the dollars,” Robinson said on Monday.

Although the board president said staff positions yet to be filled will have to be looked at carefully, the budget does not appear to reduce the number of teachers in the district nor change the district’s ability to follow the recently adopted long range facilities plan to upgrade its old physical plant.

“Approximately 77 percent of the budget is costs associated with salaries and benefits,” Fernandez said. “Every year, wages, benefits, and insurance increase as do the goods we purchase.”

“We operate 46 school buildings: 14 of those buildings are over 100 years old, 16 are over 80 years old, and only 11 of the buildings are under 50 years old,” the superintendent added.

The overall tax impact on city residents will depend not only on that portion of homeowners’ property taxes dedicated to the schools but on levies from the city and county that are yet to be determined. These levies could potentially offset costs for residents.

Between the meeting’s first failed vote and the successful second attempt, Richardson, a former board president, emphasized this point.

“When we render the levy, that’s not necessarily a tax increase,” Richardson said. “Yes, it affects the tax bill, but there are other mechanisms in place to address that, and we saw that last year,” he said, referring to the city’s ability to ask for a lesser share of property taxes.

Richardson was optimistic that Gov. Phil Murphy’s ANCHOR program for property tax relief as well as a program that allows senior citizens to freeze their taxes will help some residents who are affected by rising costs.

Jersey City public schools’ funding crunch was precipitated by many things, among them an increase in home values throughout the city and a significant amount of new development that has taken place since Trenton last visited the city’s funding position. These factors contributed to the rise in the city’s tax base, which stood at $45 billion in 2021.

Despite this high valuation, prior to this year, Jersey City had the 49th lowest tax rate according to data compiled by St. Peter’s University Assistant Professor Brigid D’Souza. State lawmakers considered this unfair to other municipalities, and as a consequence announced just days before the budget was initially presented that they would cut the city’s aid by $68 million.

This was not the first time the state recently reduced the city’s school funding though. It also did so in 2018 after passing a new funding formula known as S2 that was designed to phase out “adjustment aid” in areas with higher property values.

Jersey City is also collecting less money than it had anticipated it would from corporate payroll taxes. For the 2021–22 fiscal year this source of funding was estimated to be $225 million. But City Hall has certified only $65 million, a shortfall of $160.7 million (toward the 2022–23 school year) that school officials said last week the city is unlikely to make up.

“It is actually a perfect storm of events that leaves us students at risk,” Fernandez said of the reasons for the shortfall that the budget’s tax levy increase is helping to close.

Some of the trustees who voted against the budget said they were doing so because a school tax increase would make Jersey City even more unaffordable for economically disadvantaged students and their parents.

Barkouch said his stance had not changed since Thursday, when he said, “If we increase the school tax levy, rents will increase, and economically disadvantaged families will suffer and ultimately be pushed out of Jersey City — or worse — made homeless.”

Patrick Sprinkle, a public commenter identifying himself as a teacher, agreed.

“I worry that the tax increase would be higher than the cost of living,” Sprinkle said. “It would be increasingly unaffordable for working class people and middle class people to afford to own homes in Jersey City.”

But the majority of parents who called in to Monday’s meeting asked the board to support the budget.

“Taxes will increase regardless: This is Jersey City,” said Danielle Walker. “Raising the school tax levy will not doom the city. Abstaining from voting on a sustainable budget will doom our kids. It will be an act of defiance, and it acts against our children’s benefit, and it is an attack against our children’s educational journeys.”

“We cannot afford to go backwards to understaffing and underfunded schools, ” parent Meghan Howard-Noveck said. “We cannot go back to the days of doing more with less.”