Tax collector to set estimated tax bill for 3rd quarter

WEST ORANGE, NJ — The West Orange Township Council unanimously approved at its May 26 meeting a resolution that allows the tax collector to estimate tax bills for the third quarter of 2020, lessening the burden on residential taxpayers while there is not yet a 2020 municipal budget. According to the resolution, the estimated tax rate is 4.1 percent, and the taxes won’t be subjected to interest until either Aug. 10 or the 25th day after the bills are mailed, whichever comes first. Chief Financial Officer John Gross explained the resolution at the meeting.

“Since we haven’t adopted our budget yet, we have to set an estimated tax rate for the third quarter,” he said. “In conference with the mayor and looking it over, we’re recommending that the third quarter — because of the budget process and the finances that we have — we’re recommending that we continue with the same rate with no increases at this point in time, at least postponing the burden on the taxpayer until the fourth quarter.”

According to Gross, 75 percent of West Orange’s taxes come through mortgage companies. Those taxpayers would not see an increase now under the resolution, but they would see it in the fourth-quarter tax bill.

“But their mortgage company would have already calculated for the year following, so for the most part there wouldn’t be any adjustment until a year after that,” Gross said. “It would give many taxpayers even more help.”

Councilman Joe Krakoviak asked if spreading out the tax rate over the third and fourth quarters would be better, so a larger tax bill wouldn’t go to residents later in the year.

“If I do my rough math correctly, that leaves about 4,000 people who are paying their mortgages directly, and I’m concerned about them,” he said at the meeting. “I’m concerned that even if they have a good third quarter with the August taxes under this plan, that they’re going to get hit with a rather significant increase in their November taxes. I’m not seeing that we’re not going to have a revenue drop, so I’m a little concerned about throwing so much of this onto the 4,000 property owners in November and whether it might actually be more merciful to them to spread out over two quarters rather than one.”

Gross said that Krakoviak was right, and that neither option is a good one.

“Of two poor choices, which is the poorer choice?” he said. “A percentage now over the two quarters, or immediate relief now and then obviously finishing out in the fourth quarter. About 18 to 25 percent of our residential taxpayers would see an increase in the fourth quarter. The 75 percent would likely see significant savings over a year and a half. There is some weighing you need to do to make this decision.”

Council President Michelle Casalino and Councilman Jerry Guarino both supported the resolution as long as a detailed letter explaining the timeline and budget process is sent out to residents, which Gross said would be done.

“I don’t think asking the taxpayers at this time to pay an increased rate is what I would support,” Councilwoman Cindy Matute-Brown said at the meeting. “I think asking all of us taxpayers to pace ourselves out with the anticipation of what may come and a detailed letter breaking it down as to what we can expect would be more feasible. I’m still very hopeful that with a COVID relief act to municipalities, we are able to plug some shortfalls where we don’t have to further burden the taxpayers with whatever increases may have to come.”

Councilwoman Susan McCartney agreed.

“You’d think we’d want to space it out, but I think this is the epitome of being stuck between a rock and a hard place,” she said at the meeting. “With so many people still unemployed and businesses still closed, this would not be the time to levy an increase. It does make sense to level out, but not at this time.”

  FEATURED, West Orange Township Council