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Local Taxes Stay Stable in 2019 Budget

Members of City Council study details of the proposed 2019 municipal budget during their meeting.

By Donald Wittkowski

In a meeting dominated by financial matters, City Council on Thursday night introduced a municipal budget that keeps local property taxes stable and also introduced two bond ordinances that will fund millions of dollars in capital improvements throughout Ocean City.

Council also adopted Mayor Jay Gillian’s proposed five-year capital plan, a sweeping blueprint for $108.3 million in infrastructure projects stretching from the bay to the Boardwalk to the beaches. Projects in the capital plan will be funded on a yearly cycle, not $108.3 million in one, massive chunk of money.

The capital plan calls for nearly $33.3 million worth of projects in 2019. Big-ticket items planned for this year include a total of $6 million in road and drainage upgrades, $3 million for dredging along the back bays, $2 million for beach replenishment and $2.1 million in improvements to the historic Music Pier, the city’s main concert venue.

Construction projects to fulfill the city’s affordable housing obligations are another major part of the 2019 capital plan. In total, the city plans to spend $6.6 million to build or rehabilitate affordable housing sites for senior citizens and low-income families.

Affordable housing will be concentrated at the Bayview Manor and Peck’s Beach Village housing developments managed by the Ocean City Housing Authority.

Bayview Manor is slated for $2.7 million in rehabilitation work in 2019. Part of the flood-prone Peck’s Beach Village site will be demolished and replaced with a new 33-unit affordable housing project for senior citizens next to Bayview Manor.

The city is financing the affordable housing projects in partnership with the Ocean City Housing Authority. The authority plans to contribute $4.2 million in funding using a federal Hurricane Sandy recovery grant.

Bayview Manor at Sixth Street and West Avenue will play a major role in the city’s affordable housing plan.

In the first round of financing to get some of the capital projects underway, Council introduced two bond ordinances Thursday, one for $7.9 million and the other for $6.6 million. The one for $6.6 million will finance the affordable housing projects.

With so much money at stake in the capital plan, Michael Hinchman, the former president of the local government watchdog group Fairness In Taxes, renewed his call for the city to hire consulting experts to help it manage its construction projects.

“I don’t know that you have any oversight,” Hinchman said in public remarks to Council.

The mayor defended the city’s spending practices and construction projects, saying there is plenty of oversight. He said the city has worked well with local utility companies on a series of major projects.

“Between the gas, the water, the electric and doing the roads, we are a great team,” Gillian said.

Meanwhile, Council also introduced the city’s proposed 2019 operating budget on Thursday. The $78.9 million spending plan keeps the local tax rate the same.

For the owner of a typical home assessed at $675,000, the annual local property tax bill will be about $3,100. The figure does not include county or school taxes, said Frank Donato, the city’s chief financial officer.

Frank Donato, the city’s chief financial officer, gives a detailed presentation on the 2019 budget to Council.

The city’s finances have been strengthened by its growing tax base, including $133 million in new ratables this year alone, Donato said. The city’s total tax base is now $11.8 billion, the third largest among New Jersey’s municipalities.

“We’re in a good pattern in the past five years of sustainable growth,” Donato told Council.

Donato also noted that the city is benefiting from a new arrangement for retirement healthcare costs that will save more than $2.2 million this year.

“It was a huge win for the city this year,” he said of the healthcare savings.

Donato gave Council a detailed presentation on the budget. The governing body will scrutinize the spending plan in coming weeks before it holds a public hearing and takes a final vote.

Council President Peter Madden said he believes taxpayers will approve of the budget because it keeps the local tax rate stable while funding an array of capital projects across the island.

“I think they’re going to like it,” Madden said in an interview after the meeting. “Taxes aren’t going up. I also think they’ll approve of the amount of work that is being done at very little cost to the taxpayers.”

The mayor’s 2019 budget address is available online at www.ocnj.us/finance. The five-year capital plan is available at www.ocnj.us/projects.