By Councilman-at-large Rolando Lavarro
Your third-quarter tax bill is due October 6, and I want to warn all taxpayers to remit your payments on time, and not even a day late, unless you want to be charged with an unfair amount of interest charges that quite frankly are not of your fault. Taxpayers have drawn the short end of the stick, and here’s why.
Your third and fourth quarter tax bills are due less than a month apart.
On or around September 17, most Jersey City property tax payers received the third quarter tax bill in the mail. While your third quarter tax bill is due October 6, it would normally have been due on August 1, but the [Fulop] administration withheld your tax bills citing budget approvals and state authorization of the tax rate. In the past, the city would have issued estimated tax bills if the city’s budget had not been adopted, but the administration purposely withheld your tax bill for two months. With your fourth quarter tax bills due on November, the administration somehow sees no problem nor does it care that your third and fourth quarter tax bills are due just less than a month apart.
There is no grace period.
On the back of your bill, under the “PAYMENT OF TAXES” section, it reads:
There is a 10 day grace period, which means that we must receive your payment in our office by the 10th of February, May, August and November…
Jersey City taxpayers would normally be granted a 10-day grace period to pay their tax bill, meaning you could pay your taxes until August 10th, if it was issued on August 1st, without being hit with interest charges for the late payment. The administration did not issue estimated tax bills in 2021, as what has been done in the past; rather, the issuance of bills was delayed pending Council adoption of the budget and state approvals.
What’s important to know is that this delay was a choice, not a requirement. By delaying the issuance of the third quarter tax bill, the due date for the payment of the bill is pushed back to October 6th; but THERE IS NO GRACE PERIOD. State law does not allow for the grace period when the bill has been delayed in the manner that the administration did. If you are accustomed to having that grace period, you should know that you have no margin for error. You must pay your taxes on time before October 6.
Larger interest charges may await you.
But the loss of the grace period isn’t the only thing you should know. On the back of your tax bill under the “INTEREST CHARGES” heading, the instructions are as follows:
Interest in the amount of 8% per annum is charged on the first $1,500 of delinquency and 18% per annum on the amount over $1,500. Your account will remain at the 18% threshold until it is brought current. Interest accrues daily.
Because of the late issuance of the bill, you may get hit harder than you think if your payment is late. If you received your bill on September 16 and pay your bill a day late, you may reasonably expect to be assessed 20 to 25 days of interest charges — interest from around the time you received your bill (September 16) until the day you paid your taxes (one day after October 6). That would seem like a reasonable assumption. But that is not the case. If you are late in paying your bill, you will be assessed daily interest charges accruing since August 1 , even if you didn’t have your bill in hand or electronically.
Seniors and the most vulnerable could be hurt the most.
In 2019 and 2020, anticipating that the budget would not be adopted prior to the New Jersey statutory deadline for the third quarter tax bills, the administration issued estimated tax bills with the approval of the council, which meant that the third quarter tax bills for those years were issued on August 1 with a grace period until August 10.
With the late third quarter tax bill, taxpayers also received a letter from the mayor proclaiming that “we are delivering a budget that will CUT TAXES for every Jersey City resident”. Some taxpayers have reached out to me and asked if the bills were delayed just so that propaganda could be inserted, since such claim can’t be made with “estimated taxes”. Others have gone even further asking me facetiously if it was permitted to have a “taxpayer funded campaign ad.”
Whatever the administration’s motives may be, what I am concerned about are the impacts. At the September 20 council caucus, I noted that I, like many homeowners, have automated the payment of property taxes electronically via the mortgage company or bank. We are not likely to be adversely impacted by the loss of a grace period or the unfair interest charges accruing daily from August 1. However, there are some who rely on paper bills, especially the most vulnerable in our community. Many senior homeowners have paid off their mortgages. They may not have a bank or mortgage company automatically paying their bill. Our seniors on fixed incomes could potentially be hurt by the decision to delay taxes if they end up getting hammered with the daily accrual of interest charges for late payment.
Taxpayers deserve better.
At the recent council caucus, I questioned the forethought and fairness that went into the decision to issue late third quarter tax bills. At the same caucus, Ward E Councilman James Solomon suggested that the administration seek a waiver from the State’s Division of Local Government Services on the interest charges for the period in question. I support such a waiver and will continue to press the administration, City Council, and the state to do whatever is in our power to minimize any harmful impacts resulting from the ill-conceived decision to issue late third quarter tax bills.
The bottom line.
Jersey City taxpayers should know there is no grace period. If you are late, you will be assessed an unfair amount of interest going back to August 1. This isn’t stated in your bill or in the mayor’s letter, but you deserve to know. Please let others know, and let’s continue to look out for one another. We are all in this together.,