SOMA taxes

Hi folks, am new to SOMA but trying to understand the one thing that I am sure everyone is very well aware but I do not see it discussed much in this forum(apologies if I missed it) -  Propery taxes in SOMA is exorbitant to say the least. 

From what I hear from brokers etc, it is because rateable are less in Maplewood. On the other end, I see threads about how Starbucks is not welcome in Maplewood. I completely understand the need to maintain the village/community feel and encourage small business, but I would think we might need to have the right balance where we have some targe retail business come into the town and bring in the rateables to rein in the taxes ?

Wanted to know the thoughts in this forum. I cannot imagine SOMA residents are ok with the sky high taxes .


Welcome to the neighborhood!

Ratables are very low (no big malls or commercial strips), and there isn't space or will to create the kind of ratables that help fund some neighbors. One Starbucks more or less isn't going to make up for not having a Mall at Short Hills.

To some extent, the high taxes were baked into the prices that we paid for our homes, but since taxes just keep going up, they eventually exceed mortgage payments for many of us.

I wouldn't use the word "exorbitant", since that implies something about how the dollars are spent, and most go to real services, much of it in wages. But the taxes are high, and will only go upward, so meeting them needs to be a part of the financial planning of every resident who wants to be here for the long term.

The one piece of real advice I'd give is to pay attention to your tax valuation and make sure it is in line with your neighbors (or that you understand why it is not).  Since we are doing revaluations now, that should be easy (watch for the detail reports when the work is done). We overpaid taxes for our first few years here, because we didn't really understand that the previous owners had failed to fight a high assessment -- I'm guessing they failed to show up for the interior inspection.


When we first moved here 30 years ago the taxes were high, but that also translated into relative home-buying bargains.  (The proximity to Newark and Irvington also plays into that.)  We just paid off our mortgage and, most recently, our taxes were about two-thirds of our monthly payment.  That being said, we can't hope to find another place to live anywhere near here that we would want to live for as little as our monthly tax bill, so we aren't going anywhere else anytime soon, considering that my spouse still works in NYC.  


In addition to what has been mentioned above, you need to consider the impact on our real property taxes of the way in which schools are funded in this State.   School taxes comprise by far the largest percentage of what we pay on real property taxes.  Unless or until this problem is resolved in Trenton we are going to continue having sky high real property taxes.


Also note that Starbucks would be a leasee.  The landlord pays the taxes whether the space is leased or not.


With regard to taxes, there will be higher increases because, as others have mentioned, there are few commercial properties to generate ratables.  There also, in SO, at least, a landlord who allows his properties to deteriorate to the point that they are very undesirable to commercial tenants.  The tennants he atttracts are usually businesses that are weak in business plan and tend to turn over quickly and dont appeal the upscale demographics of the town of SO.  The area below Scotland/ Valley have renovated and match the customers likely to shop local.

The other issue is that the educational inferstructure is very old and in need of lots of upgrading.  most of this is financed through bonds, but the interest on bond payments is funded by taxpayers.

Your house will be less expensive based on the high taxes baked into the price.  what many people dont understand the magnitude of the tax increases every year, because your monthly nut will keep going up.  Its a personal preference which you can decide if you want to put more money into a higher priced house, and have a certain amount of confidence that your taxes will stay the same, or have a house that might be a bit larger, but have a big unknown about how much your taxes increased.

We sold once our monthly taxes were higher than our monthly mortgage.  when we moved to SO, our taxes were about $7,000, by the time we left 10 years later, they were close to 15,000, about $500 -1,000 a year increase My new house, which is about twice the square footage, we pay under 17,000, and in the 5 years we have been here, our taxes have gone up $700, in total.  For us, it made more sense to put money into an appreciable asset, than into the Essex County coffers.


We moved out of state early this year. SO taxes: $11k. MA taxes: $8.5k. We paid almost exactly double for the MA house than we got for the SO house.

Income taxes are higher here, though not that much higher.

On the other hand, we were just talking last weekend about how much less "kid stuff" there is to do here. Outdoor movies, concerts, fairs, etc are pretty rare.


Property taxes are discussed and debated with regularity in our towns.  

It's all a trade off, in my opinion.  Where do you want to live, how much are you willing to pay, what kind of services and schools do you want?  


yahooyahoo said:

Property taxes are discussed and debated with regularity in our towns.  

It's all a trade off, in my opinion.  Where do you want to live, how much are you willing to pay, what kind of services and schools do you want?  

These things need to be paid for, true, but property taxes aren't the only way to pay for them. Local level income taxes, or for school state level income taxes and then redistribute to the towns. Your income taxes would go up, but it would be in relation to your ability to pay. With property taxes if someone has a bad year financially, too bad, you still have to pay the same high tax.


We're not happy with the taxes, but we're in a difficult position due to dysfunctional state-level education financing plus the lack of ratables. Most of us feel that our town and school leaders are doing the best job possible of managing our money and keeping costs down while providing acceptable levels of service. There would be more outrage if people thought there was a lot of graft or inefficiency. You'll see people grumbling about the county, but that's a small slice of the tax pie and we're getting excellent park and rec facilities in exchange.

The opposition to chains is only in Maplewood village, but a Starbucks is not going to make a difference. What we need is a mall or some big-box stores, but we don't have anywhere to put them. Springfield Ave. would be the logical location, but it's lined with itty-bitty properties owned by different people, backing up to dense neighborhoods. Take a look at an aerial map and then imagine the difficulty of assembling a parcel big enough for, say, a Trader Joe's plus parking. Also, Springfield isn't busy enough to appeal to a lot of retailers. 


The unfortunate thing, to me, is that most of the things that make people love our community have nothing to do with our taxes. It's not like we're using tax dollars to pay for a diverse and inclusive community, or to pay for Maplewoodstock. There's no correlation except that our fantastic community also happens to have crappy taxes.


TarheelsInNj said:

The unfortunate thing, to me, is that most of the things that make people love our community have nothing to do with our taxes. It's not like we're using tax dollars to pay for a diverse and inclusive community, or to pay for Maplewoodstock. There's no correlation except that our fantastic community also happens to have crappy taxes.

But I love our pool and concerts in the park on Wednesdays and of course out Library  so there is that


librarylady said:
TarheelsInNj said:

The unfortunate thing, to me, is that most of the things that make people love our community have nothing to do with our taxes. It's not like we're using tax dollars to pay for a diverse and inclusive community, or to pay for Maplewoodstock. There's no correlation except that our fantastic community also happens to have crappy taxes.

But I love our pool and concerts in the park on Wednesdays and of course out Library  so there is that

Absolutely. But aside from the library, how much of all of that is covered by tax dollars? That's really what I mean. 


I disagree.  Our tax dollars make this a desirable place for many different people.  You're right that the people make the community, but if it wasn't a well run place with a receptive government good people would not stay.


The schools.

Dispite all our complaining, we have a school system that is unusual in the diversity of students and student experiences available.  Our system is more open to creativity in thought and lifestyle, and we wrestle with the challenges of society from which many other communities try to shield their children.  Now some, maybe most people in this world might not think such wrestling is a good thing, but for those of us who believe it produces young people who are more open, more thoughtful, and better prepared to constructively engage in the diversity of experiences in the adult world, then our school system is a unique benefit.

Paid for by our taxes.


Less expensive homes, with lower taxes, and a shorter commute to NYC are available in NJ.  For example, this lovely 5 bed, 2.1 bath house for $365K in Newark (taxes of $6,700 per year) is not far from the Newark Broad St. station:

http://www.realtor.com/realestateandhomes-detail/564-566-Ridge-St_Newark-City_NJ_07104_M69793-54309#photo0

But realize that in Newark, if you call the police, they may not come (as compared to SOMA where the few calls I've made over the past decade have resulted in the police arriving in less than 5 minutes).

It's also possible to stay closer to the SOMA borders to continue to enjoy the programming in the two towns (but not get SOMA-level services), by paying Newark prices/taxes with something like this 4 bed 1.1 bath, for $318K (taxes of $4,700 per year).

http://www.realtor.com/realestateandhomes-detail/317-Ellery-Ave_Newark_NJ_07106_M63659-76341#photo0

ETA: Libraries (since brought up in a post above):

Although the Newark libraries appear to have more hours and more branches open than they did when their budget was horribly slashed a couple of years ago, they are still only open past 5:30pm on Wednesdays; all branches are closed on Sundays and Mondays; and computers and copiers are turned off 15 minutes before closing time: http://www.npl.org/Pages/AboutLibrary/hours.html. 


Thead drift alert.  Sprout, that first house is a classic example of death by 70s remodel.  The aluminum siding and baseboard radiators just kill it.  What a shame.  


FilmCarp said:

Thead drift alert.  Sprout, that first house is a classic example of death by 70s remodel.  The aluminum siding and baseboard radiators just kill it.  What a shame.  

And drop ceilings...


OUCH! We just got our property assessment for 2017, AND IT IS 39% HIGHER THAN THE ONE FOR 2016! We assume this means that our taxes will increase by at least $7000 this year (from a base of $16,500). How can we afford to live in Maplewood any longer? Has anyone else experienced such a drastic increase in assessed home value? What could account for it? We will clearly want to submit an assessment appeal. Any advice on what to say and how?


assessments went up, on average, about 27℅. As a result, the tax rate will go down by about 27℅ (subject to the typical 2-3℅ increase. Your taxes will NOT increase by 39℅.



essexhome said:

Hi folks, am new to SOMA but trying to understand the one thing that I am sure everyone is very well aware but I do not see it discussed much in this forum(apologies if I missed it) - Propery taxes in SOMA is exorbitant to say the least.

From what I hear from brokers etc, it is because rateable are less in Maplewood. On the other end, I see threads about how Starbucks is not welcome in Maplewood. I completely understand the need to maintain the village/community feel and encourage small business, but I would think we might need to have the right balance where we have some targe retail business come into the town and bring in the rateables to rein in the taxes ?

Wanted to know the thoughts in this forum. I cannot imagine SOMA residents are ok with the sky high taxes .

SOMA has only a somewhat higher percentage of residential property than NJ's average.


Statewide, 84% of property is residential, but in Maplewood it is 90% and in South Orange it is 93%.

So we're 10% higher than NJ's average in residential property, so the "we lack ratables" argument is a very incomplete explanation because our taxes exceed NJ's average by much more than 10% and New Jersey's taxes are the highest in the country to begin with.

http://njeducationaid.blogspot.com/2016/05/property-type-extremes.html

As others have said, a major reason for SOMA's excessive taxes is that the state rips of off on state aid. Our Local Tax Levy for schools alone is $116 million, which is $20 million in excess of our Local Fair Share.

We actually get less state aid now - $4.3 million - than we got in 1990, when we got $4.8 million (for a few thousand fewer kids too).

Yet, the lack of state aid doesn't account for New Jersey's high taxes in general. Unlike several other high property tax states, like New Hampshire and Illinois, it's not like New Jersey has low taxes in other areas. Our income taxes, corporate taxes, and sales taxes are also significantly above average.

What is rarely said frankly is that New Jersey's school spending is extremely high by national standards and is usually ranked the third highest, after New York State and Alaska (which isn't a relevant comparison, IMO)

Using 2013-14 data, New Jersey spends, all in, $18,000 per student on schools. Massachusetts spends about $15,000.

http://njeducationaid.blogspot.com/2016/12/education-spending-and-nj-taxes.html

New Jersey's PreK spending is also the highest in the country. New Jersey spends $655 million a year on PreK and that comes exclusively from income taxes.

(It isn't a coincidence that our higher ed spending is below average.)


In a vacuum where the assessments are the only thing that changes, a re assessment should be 100% revenue neutral. The overall tax "pie" stays the same but what fraction each taxpayer pays shifts somewhat.

In areas where re-assessments are uncommon or very overdue it is possible to see massive changes in distribution of tax burden. Take a look at Jersey City as an example, where the downtown neighborhood is going to get smashed after not being reassessed since the 80's. That area has increased in value massively over the intervening years- at a much faster pace than the rest of the city.

Maplewood has re assessed regularly. Be not concerned: your bill will probably go up by virtue of taxes always going up annually, but it very much remains to be seen if your portion of the whole goes up.




deanielsen said:

OUCH! We just got our property assessment for 2017, AND IT IS 39% HIGHER THAN THE ONE FOR 2016! We assume this means that our taxes will increase by at least $7000 this year (from a base of $16,500). How can we afford to live in Maplewood any longer? Has anyone else experienced such a drastic increase in assessed home value? What could account for it? We will clearly want to submit an assessment appeal. Any advice on what to say and how?

Here is some back of the envelope math. Double check me, I am not perfect. If your taxes were 16,500, and the rate was about .036, your previous value was about 458,000. if your assessment is 39% higher than the 458,000, your value is now 637,000. Using the new rate of .028, your new tax bill would be 17,838. the increase would be 1,300.

By all means, run the numbers yourself.




FilmCarp said:



deanielsen said:

OUCH! We just got our property assessment for 2017, AND IT IS 39% HIGHER THAN THE ONE FOR 2016! We assume this means that our taxes will increase by at least $7000 this year (from a base of $16,500). How can we afford to live in Maplewood any longer? Has anyone else experienced such a drastic increase in assessed home value? What could account for it? We will clearly want to submit an assessment appeal. Any advice on what to say and how?

Here is some back of the envelope math. Double check me, I am not perfect. If your taxes were 16,500, and the rate was about .036, your previous value was about 458,000. if your assessment is 39% higher than the 458,000, your value is now 637,000. Using the new rate of .028, your new tax bill would be 17,838. the increase would be 1,300.

By all means, run the numbers yourself.

The good news is, you were probably under-assessed at $458,000. The rate will drop. I'll bet the projected rate is pretty much on the money. You can go on the ASI website, plug in your new number and the estimated tax will be calculated for you. Your taxes are not going up 39%.



deanielsen said:

OUCH! We just got our property assessment for 2017, AND IT IS 39% HIGHER THAN THE ONE FOR 2016! We assume this means that our taxes will increase by at least $7000 this year (from a base of $16,500). How can we afford to live in Maplewood any longer? Has anyone else experienced such a drastic increase in assessed home value? What could account for it? We will clearly want to submit an assessment appeal. Any advice on what to say and how?

Wrong assumption. Read up on ASI website. Average increase town wide is 27%. You don't just plug in old tax rate.


The ASI website worksheet tells you what your real property taxes would have been in 2016 had the new assessed value and tax rate been applied that year. You need to add on to that figure whatever the tax increase (municipal + school district + county) is for 2017 to get your final tax figure. The tax increase information will be available once the budgets for the three components of the real property ax are finalized. Your taxes will go up but not by as much as you are estimating.



spontaneous said:
yahooyahoo said:

Property taxes are discussed and debated with regularity in our towns.

It's all a trade off, in my opinion. Where do you want to live, how much are you willing to pay, what kind of services and schools do you want?

These things need to be paid for, true, but property taxes aren't the only way to pay for them. Local level income taxes, or for school state level income taxes and then redistribute to the towns. Your income taxes would go up, but it would be in relation to your ability to pay. With property taxes if someone has a bad year financially, too bad, you still have to pay the same high tax.

As mentioned by Joan above, it requires the state legislature to make these or other education funding reforms and they have not shown an inclination to do so. Our tax pain is worse than many towns for a number of reasons, so we are feeling more pain and feeling it sooner than other towns. But, sooner or later, that pain will hit everyone and then, perhaps (hopefully!), there will be action at the state level. But we haven't gotten to that point yet.



deanielsen said:

OUCH! We just got our property assessment for 2017, AND IT IS 39% HIGHER THAN THE ONE FOR 2016! We assume this means that our taxes will increase by at least $7000 this year (from a base of $16,500). How can we afford to live in Maplewood any longer? Has anyone else experienced such a drastic increase in assessed home value? What could account for it? We will clearly want to submit an assessment appeal. Any advice on what to say and how?

No, it doesn't work that way. Actually, if ALL homes in town had gone up by 39% then everyone's taxes would stay the same (other than the annual budget increase hit.) But, in fact the average was about 27%, so yours will go up more than some, but not by 39% (or even close) of last year's tax amount. This is because the increased total valuation in town results in a significant reduction in the tax rate per dollar valuation. Use the calculations and estimates provided on the ASI website to get an idea of the real increase you will see.

BTW, re your question about what accounts for the drastic increased in assessed value? The answer is simply the increase in market value of your home. If you believe that your home has been incorrectly assessed at significantly more than its market value (based on comparables in your neighborhood), then you have a case to argue the valuation. But if that assessed value seems reasonable from a market value perspective, then it is probably correct.


Hi, I'd just like to say that it is important to look at the big picture in discussing property taxes. In South Orange, yes, we get little state funding for our public school students. Much more goes to urban districts. If, as our governor has proposed, every student in the state got the same amount of state aid, the average property tax in South Orange would drop by $3,750. Certainly one can be against the plan. What shocks me, however, is how our local officials in South Orange and Maplewood have not uttered a peep about the proposal. On selfish grounds alone -- meaning what would benefit our kids and every property owner -- you would think they would at least discuss the issue.

I would also like to share the link between the drop in senior population and the increase in school enrollment over the past few decades. South Orange, right now, has 30% less seniors than the state average for municipalities. Every time a senior homeowner moves out, a family with kids moves in. This contributes in large part to a 15% increase in South Orange Maplewood school district enrollment. Right now we have a state-mandate cap on the school district budget, so the effect of that increased enrollment is not felt as much. The district has had to tighten its belt for a decade. But eventually there will be a price to pay for not trying to stabilize enrollment, and already the increased enrollment is having an effect in that it means less of the budget goes to the the kids presently in our schools as more come in. South Orange has to help seniors help South Orange by addressing the number one reason that forces them out -- property taxes.


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