All posts by rahwayrising@gmail.com

City Council, taxes

Council adopts transitional budget

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The City Council last month adopted a transition year municipal budget, covering July to December 2011, as the city moves from a fiscal year (July-June) to a calendar year (January-December).

The increase in the municipal portion of the tax bill for the two quarters ending in August and November are expected to be about $18 compared with the same two quarters in the previous year, Chief Financial Officer Frank Ruggiero told council members at the Oct. 11 meeting. The upcoming February and May quarters likely will see an $18 increase from the previous year as well, he said.

The average home in Rahway, assessed at $133,000, will pay approximately $1,522 in municipal taxes for the half-year, according to Ruggiero. In the last full year budget (July 2010-June 2011), municipal taxes for the average home were about $2,416 (Remember, municipal taxes make up about a quarter of your overall property bill, with county taxes comprising about another quarter and school taxes making up about half). The transitional year budget totals $23.396 million, with a tax levy of $16.326 million. The total state Fiscal Year 2011 budget is $44.91 million, with a tax levy of $31.166 million.

Some line-items in the budget show jumps of 50 percent, Ruggiero said, as a result of some departments being more seasonal. For example, the Recreation Department has more expenses during July and August while the Department of Public Works might have more expenses during the fall relate to leaf pickup. Ruggiero said he expects the city to go for an accelerated tax sale sometime in the late spring of 2012, as the state doesn’t allow a tax sale for a transitional year.

The City Council voted 8-0-1 to adopt the budget, which included the Special Improvement District (SID) budget and SID properties. The lone abstention was by 6th Ward Councilman Samson Steinman, who said he abstained to avoid any appearance of a conflict of interest since he’s executive director of the Union County Performing Arts Center (UCPAC) and sits on the board of the Arts District, which now receives SID funds.

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City Council

5% water rate hike coming in 2012

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Water rates are likely to increase by 5 percent starting Jan. 1, 2012 to help close a nearly $1.2-million deficit in the city’s water utility. The base rate would rise from $29.64 to $31.12 per thousand cubic feet. A typical residential meter (5/8 inches) would see an increase from $32.60 to $34.23 in the base rate.

The City Council introduced an ordinance (O-30-11) at its Oct. 11 meeting which is scheduled for a public hearing and final adoption on Nov. 14. Also on tap for the Nov. 14 City Council meeting is a public hearing and final adoption of at the Oct. 11 meeting, the governing body adopted the city budget, which this year is a transitional budget as the city goes from a calendar year (Jan-Dec) to a fiscal year (July-June). More on the transitional year budget in an upcoming blog post. [CORRECTION: The public hearing and final adoption of the transitional year budget occurred at the Oct. 11 council meeting; there will not be a public hearing on the budget at the Nov. 14 meeting, only a public hearing on the new water rate ordinance.]

The city purchased additional water for a variety of reasons, according to Chief Financial Officer Frank Ruggiero, including construction and dilution (the heavy snowfall led to a need to dilute water because of the salt). In total, the city spent about $450,000, of which $217,000 was funded through an emergency appropriation and raised in the budget during the transitional year, he said.

The last increase in water rates occurred in 2009, he said, and the proposed rate hike will generate about $231,000 annually.
The water utility carried a prior year operating deficit of $322,000, which needs to be raised in the transitional year. The $217,000 and $322,000 [total: $539,000], plus the amount needed to balance the water utility budget “due to lack of water rent revenue,” Ruggiero said, will require the Current Fund to supplement the utility’s budget by $1.145 million.
The water utility in 2010 ran an operating deficit of about $170,000, with total appropriations of $5.355 million (Page 8 of .pdf of city’s ’11 budget). The proposed 2011 transitional budget (scheduled for adoption Nov. 14) lists appropriations of $5.467 million for the water utility, projecting an operating deficit of about $5,000.
Several council members at the October meeting asked about the possibility of limiting any rate hike to 2 percent in 2012, or revisiting the issue annually. City Administrator and Redevelopment Director Peter Pelissier recommended the increase be 5 percent for three years but if the City Council would prefer an annual analysis, “that makes sense.” In that case, he preferred to see the rate hike higher this year, “but I know people are struggling,” he said.
In the late ’90s, the city hired United Water to manage its water utility for 20 years. Pelissier said the savings to the city over that time are estimated to be $32 million. The city still owns and maintains the facility, he said, paying a fee to United Water to manage it. The fee now is at its highest point but by 2014 will drop below $1 million, he said. The city will realize that drop in the operating budget, Pelissier said, adding that water utility surpluses in the past have gone back into the city budget.
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Readers who live near the border of Colonia/Woodbridge might be interested in this bit of news from Woodbridge Patch: “Woodbridge Buys Land Development Rights of Colonia Country Club.” Here’s MyCentralJersey.com’s take on the same story.

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Uncategorized

‘Four more years!’

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So, if I’d started college at the same time I started this blog, I’d be done (at least with a bachelor’s degree — luckily I’ve already got one!). Well, that certainly puts things into perspective. But hey, happy anniversary anyway. I doubt I’ve had as much time to devote to the site in 2011 as in years past but I hope it’s been valuable or helpful to you in some way. Regardless, thanks for reading.

On average, the site gets about 1,000 visits and about 1,500 page views per week. In all, there have been almost 181,000 visits, more than 284,000 page views, and 57,500 visitors. Some other statistics about the blog:
– 380 Facebook friends
– 247 Facebook fans
– 161 Twitter followers
– 302 e-mail subscribers

People seem to have really gathered on Facebook in the past year, while email subscribers fluctuated, strangely, between 300 to as many as 330. Facebook and Twitter have been used to sprinkle in some related or interesting development-type stories that might be linked to at the end of an original blot post. Whether it’s a story from a Jersey media source or maybe something in New York or nationally-focused, there’s always something interesting going on elsewhere that provides perspective (or a good idea to steal) for local issues. Let me know if it’s worth continuing, or if you hate it.

Some ideas for the coming year, if I can keep it up, are doing a blog poll more often, and since we’ve got four years worth of writing, maybe a “retro blog post” occasionally, to revisit certain places or projects. Perhaps you have some other ideas for the future? Of course, I know we’re long overdue for another Rahway Rising happy hour.

And of course, here’s how it all started, with the very first blog post.

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It may not be specifically about a Rahway business, but this nj.com story from last week got me thinking about what it takes to start a small business and keep it going: “NJ Couple’s dream of owning business ends in disappointment.”

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Arts District, Downtown

Hamilton Stage coming along

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Work is coming along on the Hamilton Stage for Performing Arts with walls recently going up to cover most of the steel. The $5.825-million project is slated to be complete by next spring.

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Arts District, Commercial, Downtown, Retail

Financial issues plague proposed jazz club

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Years ago, the Redevelopment Agency agreed to sell the former Kelly’s Pub on the condition that the property at the corner of Irving Street and Seminary Avenue be turned into a jazz club and restaurant.

Serious financial issues have plagued the proposed KC Jazz Club to the extent that developers would like to explore selling the property as a simple tavern — only they would need the agency’s approval first. In a Sept. 19 letter to the Redevelopment Agency, Union-based attorney Ronald Esposito, representing E.T. Building, LLC, asks for a meeting to discuss issues in hopes of resolving “what appears to be a very serious financial problem.”

“The only  possible way my client can recoup some of their money and reduce their loss, would be to explore the sale of the property and liquor license without the restriction that the facility must be a restaurant/jazz club,” Esposito wrote, adding that Realtors have indicated it would be easier to sell the property without the restriction that a jazz club and restaurant be built.

The property, at 1646-1654 Irving St. (Block 162, Lots 5-7), was acquired for $398,000 in April 2004, according to PropertyShark.com, and pays about $5,500 in property taxes. Only a few weeks ago, the KC Jazz Club website was still active, featuring the rendering below, and proclaiming a 2012 opening. The website was suspended sometime in the past couple of weeks.

City Administrator and Redevelopment Director Peter Pelissier said the attorney should be advised to come before the agency with an update. He told commissioners that the agency “shouldn’t just arbitrarily approve it” but wait for the applicant to present a plan for what to do. The intent of the redevelopment agreement, and the agency selling the property, was for a jazz bar/restaurant, Agency Attorney Frank Regan said, so they would have to come back to the agency for approval to make it simply a tavern.

Esposito details issues the developer has had with financing, including an original $1.5-million mortgage from RSI bank that fell through and a partner defaulted on sale of another property, the proceeds of which would have helped to fund the jazz club effort. Over the past three years, Esposito writes, his client has reduced the cost of the building from $2.3 million to $1.7 million in a failed effort to secure financing from a bank and then private investor. He claims that the anticipated value of the building was agreed upon at $1.75 million when completed ($2.3 million with the restaurant operational).

The bank was to extend a mortgage of $1.5 million, which was reduced to $1 million, Esposito said, which may or may not still be available since about six months ago RSI insisted on payment of the initial $400,000 mortgage money advance used for the property and monthly payments of $2,685 since April. [You can read the full text of the letter here.]

What site looked like two years ago

In addition, Esposito explains that since December 2005 contract entered into with the agency, his client had to purchase a liquor license for $40,000, and pay annual licensing fees of $2,100 to the city and $200 to the state. He also details $32,000 in costs to obtain Department of Environmental Protection (DEP) permits, $15,000 in costs to obtain variances from the city, and $120,000 for engineering and architectural planning.

In a postscript (P.S.) to his letter, the attorney suggested that due to the length of time involved the agency consider, as an alternative, the temporary abatement of taxes and ABC fees until the matter is resolved.

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Commercial, Downtown, restaurants

Patria a ‘Don’t Miss,’ for New York Times

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Forgive me if I’m a little late with this, but check out last week’s Sunday New York Times for a review of Patria Restaurant and Mixology Lounge. 

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