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Heavy Metal

Here we go again.

Hamilton is pissed. Mayor Kelly Yaede released a statement yesterday that says, in part, “Without advanced notice, we have learned today about the Trenton Water Works letter that residents are already receiving in the mail regarding lead in drinking water. I want our residents to know that we are taking action to gather further details so that you can be better informed.”

Trenton’s Water Works (TWW), as we all know, provides several communities in Mercer County besides the City of Trenton with fresh water, and has done so with varying levels of quality and safety – over the last few years. Shortly after taking office in 2010, the new Administration of then-Mayor, and later Federal Convict, Tony Mack experienced several problems at TWW that affected customers throughout the system. These problems led Hamilton’s then-Mayor, and later Federal Convict (hmm, something in the water?) John Bencivengo to seek a county takeover of TWW. In a December 2010 letter to Governor Chris Christie, Mr. Bencivengo wrote, “Numerous instances over the past several months have provided me with absolutely no confidence that this utility can remain under the supervision of the City of Trenton and be responsibly operated in a manner that protects the safety of Hamilton residents and the fiscal integrity that the consumers of our community are entitled to and deserve.”

One of those incidents was a several day interruption of water service due to brown-water in the system after severe storms. The interruption was first blamed on the weather, but later was revealed to have been caused by human error, according to a TWW whistleblower. Customers in Hamilton, along with Ewing, Lawrence and Hopewell Borough were affected, and upset. More so when Mayor Mack blew off and failed to attend  a meeting that had been scheduled by County Executive Brian Hughes with the mayors of those townships to discuss TWW’s problems.

We’re back to those bad old days, it seems. Without any advance notice, as Mayor Yaede complained, a letter was mailed to TWW’s customers – as required by Federal law – and it started popping up in customers’ mailboxes yesterday. The letter, which is on stationery containing the names of Trenton’s Mayor Eric Jackson and Public Works Director Merkle Cherry, begins,

“Trenton Water Works found elevated levels of lead in drinking water in some homes/buildings. Lead can cause serious health problems, especially for pregnant women and young children. Please read this information closely to see what you can do to reduce lead in your drinking water.”

Later on in the note, Mr. Jackson and Mr. Cherry say,

“Trenton Water Works is in the process of drafting a Request for Proposal to implement a Corrosion Control Study. This will help to reduce lead levels by identifying areas with issues allowing Trenton Water Works to adjust the corrosion control treatment to address these concerns.”

As of this morning, no further information has been provided by the City, nor any further statement by the Mayor or Director. This is what we have to go with. Which, considering that lead in the water supply is a pretty big deal – ask the folks who live in Flint, Michigan – and that Trenton has been dealing with this issue for over a year, is a big concern.

TWW Superintendent Joseph McIntyre addressed City Council in April 2016, in the wake of the water crisis in Flint, and said, “It’s been a pretty hot topic thanks to our friends in Flint. The good news is here in Trenton it’s not a hot topic as it pertains to water. We’ve never had a lead-based problem here in the water [Emphasis mine - KM].”

Yet, barely six months later, we read this headline: “20 Trenton school buildings test high for lead levels.” Even then, we were told that whatever problem there was with the water supply was localized to specific older buildings. Trenton Times reporter wrote in the piece linked just above, “In April, city officials said the water mains are lead-free, but a lead expert acknowledged that the toxin can build up in schools’ aging plumbing when water goes unused over weekends and long breaks. Elyse Pivnick, the director of environmental health for Trenton-based Isles, has said that lead-based paint in the city’s older housing and buildings remains one of the most common sources of lead exposure.”

But now, reading this letter, it would appear that the presence of heavy metal in our water supply is not just limited to Trenton’s school buildings. How prevalent is it? You can’t tell by reading yesterday’s letter.

One clue can be found in this document.

Mr. Jackson and Mr. Cherry  actually misspoke about the status of its Corrosion Control Study Request for Proposal (RFP). It’s not being drafted. It’s finished and was published on the City’s website last week, a fact that Trenton’s Scott Miller tipped me to last week. The City is open to receive proposals until August 29.

In this RFP, the City states the problem succinctly. On Page 5, the RFP states, “Lead levels exceeded 15 ppb [parts per billion] for the 90th percentile during the January 1, 2017 through June 30, 2017 monitoring period.”

For perspective, in the height of the Flint crisis, during the 6-month period of January to June of 2016, Flint’s level was 20 ppb. And the 15 ppb threshold is considered an “action level” under Federal water safety rules, which Trenton’s water has exceeded during the first half of 2017. That’s what likely triggered the mandatory warning notice to TWW customers. All we know today is that lead levels in TWW’s water exceeded 15 ppb this year. We don’t know by how much more. Pretty key information, I think.

What caused this? According to the City’s own RFP, “process changes” introduced by TWW itself. The RFP narrates, on pages 4 and 5:

Trenton Water Works obtains its entire supply from the Delaware River. The filtration plant is Trenton’s only treatment facility. This supply is treated by a conventional treatment plant (clarification followed by filtration) located at the intersection of Route 29 and Calhoun Street.

The treatment plant was constructed in two phases during the 1950s. In the early 1990’s a new disinfection system was installed using Wallace and Tiernan evaporators, chlorinators, injectors, and associated appurtenances. The pretreatment was modified and various plant upgrades were made during a large upgrade project completed in 2010/2011. This upgrade brought the firm capacity to 60 MGD [million gallons per day] with the average daily production of approximately 27 MGD. The treatment plant consists of a river intake, screen house, raw water pumping, rapid mix, chemical feed, SuperPulsators for flocculation and sedimentation, filters, clearwell and high-lift pumping.

During the most recent upgrades the coagulant was changed from Aluminum Sulfate to Ferric Chloride to generate a heavier floc. Also added was a slaking system for pH and Alkalinity adjustment.

Starting in 2017 the water filtration plant is being converted from chlorine gas to sodium hypochlorite.

TWW has had some operational issues with the slaking system. The system has been maintenance intensive. The most recent contracts for the system include a $227,000 contract for maintenance services, $13,700 contract for a softening system maintenance contract and supply of salt, $101,300 contract for the supply of quicklime. Additionally, TWW is concerned about the impacts of the various process changes on the corrosivity of the drinking water.

The Lead levels exceeded 15 ppb for the 90thpercentile during the January 1, 2017 through June 30, 2017 monitoring period. Any immediate measures would  be sought as part of the study as part of the services. [Emphasis mine - KM]

To this layman, it sure does sound like TWW is admitting, “Hey, we started doing something as far back in 2010 and 2011, and as recently as this year, that’s screwing things up. Any solutions you can suggest that would be helpful right away would be really appreciated!”

This is a problem that’s been developing for quite some time. This most recent RFP for a Corrosion Control Study may be related to deeper and more fundamental problems going on with TWW, which led to ANOTHER RFP issued earlier this Spring, seeking “Management Advisory Services” for TWW.

So, what the hell is going on at Trenton’s Water Works? And why in hell is the first we are hearing of this in the form of a not-very-informative letter mailed to customers’ homes?

Why isn’t TWW’s Superintendent McIntyre telling us what’s going on?

Why isn’t Director of Public Works Merkle Cherry telling us what’s going on?

Why isn’t Mayor Eric Jackson telling us what’s going on?

Hamilton Mayor Kelly Yaede is pissed. So, I imagine, are all of TWW’s customers, including me.

What’s Going On?

Dear Councilman Chester

As e-mailed 8-8-2017:

Good Morning, Councilman -

With all due respect, kiss my ass!

You are quoted in a news story that ran on WPVI/6ABC yesterday on the subject of the recent property revaluation completed in the City of Trenton. Reporter Nora Muchanic reporter included this in her story:

“City Council President Zachary Chester, whose property taxes jumped almost $4,000, says the city doesn’t want businesses leaving.

“‘Let us try to figure out something, ask the state, see what we can do legally, so that people don’t have to close their doors,’ Chester said.

“Chester wants to formulate a plan to help residents and businesses with tax appeals and review the assessment process that led to these jaw-dropping tax hikes.”

Really? THAT is your response at this late date? “Let us try to figure out something?” “Ask the state?”

Please, let me ask you what you have done in the last SEVEN MONTHS, since you were first alerted to the problems and the dangers raised by this revaluation? What have you and your colleagues done over the last HALF-YEAR to “try to figure out something?” Have you ever “asked the state” in the last 200 DAYS since I sent you and the other members of Council the note below?

Did you have any reaction at all when I wrote,

If these preliminary valuation increases in my neighborhood and others in the West Ward  are made permanent, and the remaining valuations do not result in a significant increase to the City’s total Net Valuation Taxable, the subsequent city property tax bills that I and my neighbors receive will be a disaster for the Ward and for the City of Trenton. Who will be able to afford tax increases of anywhere near 40%, 50% or more? Not me. not most of my neighbors.

And, if I may speak directly to you, Councilmembers, not many of you, I would guess. Mr. Chester, your property increased in value by 55%. Mr. Harrison, yours by 43%. Mr. Bethea, yours by a relatively moderate 15%. Ms. Reynolds Jackson, you don’t live in the West Ward, but your East Ward property increased in value by nearly 67%!

Although certainly not a member of your body, I will hope that Mayor Jackson can empathize with these kinds of increases, even though his own property increased in valuation by a very minimal 2.4%, less than the rest of city as a whole, on average.

If you took any action at all in the last half year to address this current situation, I ask you, please, share with the residents and business owners all of what you did. Please release your correspondence to the Mayor, to the Administration, to the State. Please reveal what kind of responses you received. Please let us know what you and yor Council colleagues have done in the last half year on this matter, other than sit on your asses and vegetate.

I am outraged that you can speak to a reporter as if this is a problem that has popped up out of nowhere! I am appalled that your gut reaction is to “ask the state” for help. I am disgusted that the President of my City Council, also my local Ward Councilman, is so unprepared to deal with this.

Along with your comment last week about “riding the gravy train,” your failure to act in the last half-year – hell, your failure to even provide the basic courtesy of a reply to my letter to you back in January – is the last straw for me.

You’ve served well past your ability to make any contribution to the citizens of Trenton with your service on Council. You are unable to even recognize the outlines of a major crisis even when it is carefully laid out to you by a constituent. As a result, the last seven months have been utterly wasted. Now that you have heard several business owners appeal to Council about the damage that this revaluation will do to their livelihoods, only now you begin to realize what this will do to this City.

But I fear it’s too late. You’ve squandered the best chance to deal with this situation before it hit the fan. You’ve wasted the most precious commodity of all, time, as you’ve done nothing for 200 days. If I am misinformed about any work that you have been doing behind the scenes, I will be happy to be proved wrong. However, if your past record is any predictor of what you’ve done in this case, I don’t think I will be proved wrong.

So, Mr. Council President, if your best answer to this clear and present danger to the economic future of this City is to “let us try to figure out something” and “Ask the state” for help, if you haven’t “formulated a plan” by now, then I must again say, with all due respect, Kiss my ass!

Most Sincerely,
Kevin Moriarty

On 2017-01-20 11:54, Kevin wrote:

Good Morning, Councilmembers -

Information released this week by Appraisal Systems, Inc., (ASI) the City’s contractor charged since 2015 with the state-mandated Property Revaluation process, is very troubling. I am personally troubled by a property valuation that has increased nearly 45% from my current one. However, I am more concerned that my valuation and those of my neighbors in Cadwalader Heights as well as the rest of the West Ward and City nay have been calculated as the result of a critically flawed process.

When Council approved the revaluation process in March 2015, the official estimate for completion of the process as given to the press (http://www.nj.com/mercer/index.ssf/2015/03/revaluation_of_trenton_properties_to_be_reflected.html) by the Administration was that “the new valuation is expected to appear in first-quarter tax bills for 2016.”

We are fully one year late in this process. Why is that? I and many other Trentonians heard anecdotally that ASI staff and resources, which were thin on the ground in our town, were pulled off the Trenton revaluation for one or more other New Jersey municipalities. Upon the conclusion of those assignments, attention was turned back to Trenton as ASI tried to catch up on lost time.As a result, other anecdotes tell me, the resulting effort was rushed and inadequately done, with less than appropriate examination done on several properties and neighborhoods. I hear many tales of non-existent bathrooms and bedrooms allocated to properties, for instance. I am concerned that too much of this revaluation may have done in a very superficial way.

This is certainly the case with my property. In the beginning of the process we received the expected postcard from the assessors, stating the time and date of their visit. Since the proposed was during weekday business hours, my wife and I were unavailable. Unlike the process outlined in the Revaluation Presentation of March 19, 2015 (http://www.trentonnj.org/Cit-e-Access/webpage.cfm?TID=55&TPID=15188), we did not receive a card notifying us of a second appointment. Nor, according to the process outlined in the Revaluation Presentation, did we ever receive a blue “estimate card” summarizing the findings of the assessors. Our assumption for the lack of these cards, for which we blame ourselves for making, was that the process was still delayed and on hold.

From what we hear, our experience was not unique, and is pretty typical at least for our part of town. The detailed, individualized process we were promised, and told would be “expected to appear in first-quarter tax bills for 2016″ did not happen.

I don’t know on what basis the revaluation of my property was done. I have requested my Property Record Card from ASI as suggested on the ASI website, but have as of today received no response, again.

Examining the 1-17-17 spreadsheet of residential property values on the ASI website, I see that similar significant  valuation increases have been calculated not only for my neighborhood, but nearby West Ward neighborhoods such as Hiltonia, Glen Afton, The Island and Berkeley Square.

Councilmembers, I well know that the rate of these valuation increases in my neighborhood and throughout the West Ward do not represent the eventual increase of the property taxes that will be charged to my property in the next tax year and going forward. I do know that the new tax rate will be based on the citywide revaluation. If the total rateables base of the City increases by a similar percentage to that of my property and those of my neighbors, the impact of the individual valuation will be moderate. That is how the process is supposed to work.

However, on the ASI spreadsheet, the significant increases in valuations seen in my and other local neighborhoods are nearly offset entirely by significant valuation decreases in other Trenton neighborhoods across the City. Nearly half of the properties on the spreadsheet show valuation decreases, some as much as 50%, 60% or more. Many of these are likely to be properties demolished or abandoned since the last valuation, but surely not the over 3100 thousands showing decreased value of 10% or more.

Taken as a whole, the total valuation of the nearly 10,000 properties on this spreadsheet has increased – city-wide – by only a little over 4.4%. If the increase on this spreadsheet is, as I believe, representative of what the eventual total increase will be for the entire City, then the total rateables base will not increase to the total necessary to moderate the massive increase in valuation of my property and those of my neighbors. My tax bill, and theirs, will rise. Significantly, painfully, and unsustainably.

Why do I believe that this spreadsheet, containing only about one-third of the total number of parcels in the City, is a representative sample of what the eventual total will be? Why am I so concerned now, before the new tax rates are calculated?

First, the size of the sample of this spreadsheet, at one-third of total of the City, is a large enough sample to be statistically significant.

Second, the increase in the total valuation since the last valuation in 1992 of this sample, at 4.4%, tracks very closely to the annual trend line shown in the city’s total annual valuation data since 1998, as summarized in the state Department of Community Affairs annual Property Tax tables (http://www.nj.gov/dca/divisions/dlgs/resources/property_tax.htm) From 1998 (the earliest year posted on the State website) to the most current year of 2015, the City of Trenton’s total Net Valuation Taxable increased by only 5.5% That tells me that ASI’s spreadsheet, though still incomplete, is an accurate representative sample for the purposes of forecasting the end result of the revision of tax rates based on this revaluation.

Third, most of the City’s more valuable residential properties are located in neighborhoods already on this spreadsheet. Many of the West Ward neighborhoods listed above are numbered among the city’s largest residential lot sizes, and their higher values. Hiltonia is already on this list. Cadwalader Heights is already on this list. Glen Afton, already on this list.

As are many of the more recently constructed residential developments, some of whom are showing new valuations for the first time after expiration of many initial PILOT agreements. K Hovnanian is already here, as is 350 South Broad.

I am concerned that – even with all of these neighborhoods and new developments already baked in to a spreadsheet that shows Citywide property values increased only by 4.4% – the residential properties to be added to the City’s valuation will end up showing net valuation decreases, and therefore pull the City’s total rateables base further down from that 4.4%.

And I will only mention the City’s commercial properties to ask you all if you really think that over the last 25 years you will expect to see the total value of Trenton’s commercial property to lift the total tax rateables off the flat, flat floor they have been sitting on for the last quarter-century?

So, Councilmembers, for all those reasons, I do feel justified in being extremely concerned, as an individual property owner and as a Trenton citizen, about these preliminary results of the ASI process.

If these preliminary valuation increases in my neighborhood and others in the West Ward  are made permanent, and the remaining valuations do not result in a significant increase to the City’s total Net Valuation Taxable, the subsequent city property tax bills that I and my neighbors receive will be a disaster for the Ward and for the City of Trenton. Who will be able to afford tax increases of anywhere near 40%, 50% or more? Not me. not most of my neighbors.

And, if I may speak directly to you, Councilmembers, not many of you, I would guess. Mr. Chester, your property increased in value by 55%. Mr. Harrison, yours by 43%. Mr. Bethea, yours by a relatively moderate 15%. Ms. Reynolds Jackson, you don’t live in the West Ward, but your East Ward property increased in value by nearly 67%!

Although certainly not a member of your body, I will hope that Mayor Jackson can empathize with these kinds of increases, even though his own property increased in valuation by a very minimal 2.4%, less than the rest of city as a whole, on average.

Can any of you afford higher  tax bills any where near those kinds of rates? Remember, the City as a whole looks set to increase in value very little if at all. A rising tide of City wide property value increases will not allow you, or me, to absorb the pain of higher assessments by the benefit of a lower tax rate.

If the current results of the revaluation stand, the significant increases that seem to be concentrated in specific neighborhoods – Hiltonia on average increased by 32%, Cadwalader Heights by 39%, those neighborhoods  and many of their homeowners will hurt.

It will be hard to absorb heavy tax increases. Foreclosure will likely rise, and resale values will collapse. Who will want to buy my house -  or yours, Mr. Chester, or yours, Mr. Harrison, or yours, Ms Reynolds-Jackson – and pay even more of Trenton’s notoriously high property taxes, from which we see so little value?

In the lean years since 2008, my neigborhood has seen foreclosures and abandonments, and burnouts. I fear there will be more.

Councilmembers, I urgently and respectfully ask you to look into the way the revaluation process was conducted. As I discussed above, we know for a fact that the process was delayed. We need to know that this delay did not  produce – as my personal experience and many anecdotes attest – a rushed, incomplete and flawed process that will harm thousands of your constituents, and perhaps even many of yourselves.

If you find this to be a flawed process, please suspend it and if necessary, begin it again.

Thank you,

Respectfully,

Kevin Moriarty

The Revaluation of La-La Land - Revisited

I hate to say “I told you so,” but…

Last Night’s Trenton City Council session was marked by several indignant commercial property owners complaining to the Councilmembers about their new tax bills received in the mail this week. These tax bills were based on the recently-completed property revaluation conducted for the City by Appraisal Systems, Inc. (ASI), the city’s first comprehensive revaluation since 1992.

They weren’t happy. As narrated by Trentonian reporter David Foster,

Numerous Trenton businesses said their taxes have tripled after an assessment was done at their properties.

“Mine alone was increased almost $33,000,” Brian Hawkins, owner of Hawk’s Towing told city council on Thursday night. “My son’s shop was increased $29,900, which is around the corner.”

A friend of Hawkins had his taxes shoot up an absurd $100,000, the owner said.

Yeah, I’m hearing you. I started writing about this back in January of this year, when the first draft residential numbers were released on ASI’s page. Even before the first commercial numbers were released I noted,

Who in the world will buy Trenton property at anything close to current market prices that come with a property tax burden so astronomically high? We already are burdened with some of the highest property taxes in New Jersey, and the value we get for those high taxes is abysmally low. If these tax valuations stand, sale prices for many neighborhoods in town will collapse. This will probably result in increases in foreclosures and abandonment in neighborhoods that – so far – have managed to avoid too many of either.

Nothing that has happened since has changed my mind on this. My feeling is that this entire ASI revalution process is fatally flawed, and will lead to the ruination of many of the City’s residential neighborhoods, and all of its privately-owned commercial base. Business owners get that, and made their feelings known to Council last night.

I also made my feelings known to Council months ago. On January 20, I wrote to each member of Council a long note, concluding with this urgent appeal:

Councilmembers, I urgently and respectfully ask you to look into the way the revaluation process was conducted. As I discussed above, we know for a fact that the process was delayed. We need to know that this delay did not  produce – as my personal experience and many anecdotes attest – a rushed, incomplete and flawed process that will harm thousands of your constituents, and perhaps even many of yourselves.

If you find this to be a flawed process, please suspend it and if necessary, begin it again.

Apart from ONE note from ONE Council member, I received NO RESPONSE from any other member. Apalling. From January to this week, as suggested by the Trentonian’s article, NOTHING HAS BEEN DONE by anyone on Council or in the Administration to investigate or address a critically flawed revaluation process. NOTHING.

I really don’t know what happens from here. A number of residential and  commercial property owners filed tax appeals, which are working their way through the system. Me, I got so dispirited and disgusted at the lack of accountability at City Hall I didn’t even bother to file. I figured, and based on last night’s meeting perhaps correctly, that once commercial property owners got their first bills, all Hell would break loose and that the entire revaluation would be thrown out. Either that, or the results would stand, businesses would fold left and right, residential property values would crash and we’d all end up walking away from our investments anyway.

So, here we are. Let’s see what happens now that the owners of Trenton’s last commercial property parcels have absorbed the impact of being told that their assessed values have increased by nearly 70% while residential property has remained, on net balance FLAT, even though individual residential valuations have mostly either been slashed or skyrocketed; also literally unbelievable results.

That this mismatched result is fundamentally both unfair and highly unlikely is something I discussed in depth in my post of January 26. I compared ASI’s analysis of other NJ towns comparable to Trenton that they had worked in recently, and found that Trenton’s revaluation results were, what’s the technical term, Real Fucked Up. Since the numbers reported then have remained almost exactly the same, this piece remains as current and relevant now as it did in January. I post it in its entirety below.

Perhaps THIS time someone in City Hall will pay attention???

Nah, that’s way too much to ask. These guys are useless.

— # —

“The Revaluation of La-La Land” – Originally published January 26, 2017

More information has come available about the current property revaluation and re-assessment process coming to a conclusion in Trenton. As is true of many things about this town, it doesn’t make a lot of sense to me. In fact, it’s downright screwy. The results that are coming online seem to indicate a massive economic disconnect in the City between its residential properties and its commercial/industrial ones, a disconnect that I can’t frankly believe. Either the company that has done the assessments, Appraisal Systems Inc (ASI), or the City of Trenton, think we are living in a fantasy town with limited connection to economic reality, a La-La-Land-on-the-Delaware. Compared to a number of other NJ towns with comparable property values, Trenton’s numbers are extremely odd.

So what else is new?

First off, ASI has updated the spreadsheet listing Trenton’s residential properties, from the one that was posted last week. This one now seems to be more or less complete, with 21,371 individual properties listed with a total current 2016 assessed value of $1,359,802,270. You can find the spreadsheet, called “Trenton Residential Proposed Assessments,” at this page. Or, along with a column calculating the % increase or decrease in assessed valuation for each property, at this location. The net result of this updated list shows, as was suggested from the data in the first version and as I wrote last week, that the change in valuation of Trenton’s entire residential property has been flat, without adjusting for inflation, since the last major assessment in 1992.That’s flat, flat, flat. Trenton’s residential property is worth 99.26% of last year’s value, which is largely based on the 1992 numbers.

OK? So far, that’s nothing new from last week. The substantial individual property valuation increases of 60%, 70% and more that we saw last week are almost exactly evenly offset with substantial valuation decreases, to end up with no appreciable impact to the city’s total residential values. We are, as in so many things, a town of extremes.

We now know – without any level of detail comparable to that of the 21,371-line residential spreadsheet, though – what the results are for the revaluation of Trenton’s commercial and industrial properties. Before I get to that, a few words of background and context.

Now, one shouldn’t expect residential and commercial properties to increase or decrease in value in any kind of synchronized way. There are a wide number and variety of different factors at work that determine if a given town is considered an attractive – and therefore, valuable – place to live compared with a place to do business. Those factors don’t change in lockstep for the residential and commercial/industrial side of things.

And yet., there are many ways in which both sides do relate somewhat closely with each other. Both residential and commercial properties are located, literally, in the same world. They share the same streets, utilities, access to highways and railroads, are protected by the same police and firefighters. The fortunes of businesses established to serve local residents – such as groceries, laundries, restaurants  and bank branches – rise and fall in some direct relation to the rising and falling prosperity of their local neighbors.

So, even though you wouldn’t expect the numbers or the trends in valuation for commercial and industrial properties in Trenton to be identical to those of the city’s residences, you’d expect some correlation, right? That is, in the normal world, you would. And in most instances, even in New Jersey, you’d be right.

Welcome to Trenton. It’s a very special place all its own. The result of the very same property revaluation process that states that the total value of Trenton’s residential properties FELL by 00.74%, basically flat as we’ve seen, tells us that the value of commercial and industrial property in Trenton INCREASED by 69.50% in the same time period!

How can this be, you ask?

Damned if I know! But here, take a look!

trenton tax impact 1

This is an excerpt from another document on the ASI website, called “Trenton 2017 Revaluation Tax Impact,” which you can download by clicking on the link to the left, or view or download here. You can see in the excerpt above the differing valuations for the different classifications of property in the City, and how they have increased or decreased. The GRAND TOTAL for the City indicates an overall increase in the total valuation of property in the City as being 22% higher than the previous valuation. However, because residential properties have stagnated, the entire amount – ALL of it – comes from commercial and industrial valuation (plus some Apartment properties). As a result of that net increase of 22%, the provisional draft tax rate for the City – as seen in the full version of this sheet – has, for the time being until valuations have finalized after appeals, and after the new city budget (for the current year more than half over) has been adopted, dropped from $5.753 per $100 of valuation, down to $4.732.

In the hypothetical example shown on the sheet, a property owner previously assessed at $64,100 and now assessed at a lower $63,500 would come out owing $682.73 LESS in Trenton property taxes. If you are among the nearly 12,000 residential property owners whose valuation went down, Congratulations! You stand to save some tax money.

However, if you are among property owners – residential or commercial – whose valuations increased, Too Bad! you are going to pay. In my own case, my valuation increased by 44.68%, but my taxes will rise by a somewhat lower 20%. I stand to be paying about $2,100 extra under this scheme.Ouch.

For a hypothetical commercial property owner, the bite is likely to be much bigger. We don’t have a spreadsheet showing individual increases, but we know the aggregate increase is close to 70%. If you own a commercial property currently assessed at $100,000, a 70% bump will bring that to $170,000. Your tax bill will jump 40%, a bump of $2,300 per year. Yikes!

Of course, as we have seen in multiple examples of residential valuation, especially in the West Ward, some increases are as high as 80% or more, even though the city as a whole averages out to 0%. It’s safe to assume that several commercial property owners have been opening envelopes this week revealing individual increases WAAAY higher than the average 70% for that classification.

A lower tax rate by itself is generally a good thing, and may help draw in some new investment. But from what can be seen from the currently available numbers, it looks to me that the lowered tax rate was made possible only by massive residential property tax increases assessed on a small number (15% of the total) of residential property owners, and the entirety of the commercial and industrial sector.

The revaluation disconnect between the total residential and the commercial/industrial sector seems highly distorted to me. I can’t tell based on what we now know whether this process has been manipulated in any way, but we can see that this distortion – 0% increases in the residential sector and 70% in Commercial – is not seen in other New Jersey towns of similar valuation who were reassessed by ASI in the last several months.

Below are charts for the Tax Impacts from the revaluation processes conducted in three NJ towns: Ramsey, Passaic and Maplewood. I chose these three samples for a few reasons. 1) they were all reassessed by ASI; 2) similar Tax Impact charts were available for them, as opposed to other ASI clients; and 3) their aggregate property values, as well as the residential/commercial mix, are similar to Trenton. Take a look. (Please note that ASI doesn’t format their sheets the same way for all their clients, which may cause a little confusion. Bear with it, though. These tell a story)

ramsey 1

In Ramsey (you can see the entire form here), we see a town initially valued at $2.853 Billion, compared with Trenton’s $2.022. It was re-valued at $3.474 Billion, an increase of 22%. In this town, Residential properties went up by 19.12%, and commercial up by 32.57%. Not in sync, certainly, but hella closer to each other than 0% and 70%!

passaic 1

Passaic’s total valuation spiked, from $1.320 Billion up to $3.085B, a whopping 233% increase. Here again, though, the increase of the Residential sector, at 216%, bears some relation to the Total Commercial sector’s increase of 262%.

One more example, Maplewood:

maplewood 1

The total valuation of Maplewood increased by 27%, with the residential sector going up by 25.92% and Total Commercial by 38.93%. Once again, and for the third of our examples, there is some correlation between the new values assigned to Residential properties, and to Commercial.

To look at these summaries for the results of the revaluation processes for Ramsey, Passaic and Maplewood, you can easily get a sense that the commercial and residential sides of these communities are located in the same towns. There’s a solid impression that you get that these numbers make sense, they come close to reflecting a credible reality in these communities.

When you look at Trenton, you see two different towns. One, economically struggling, town in which increases in residential property values are utterly flat – on average, but which individually careen wildly from decreases of -80% all the way to +100%.

And a second, pretty successful commercial and industrial city, with market assessments up by a healthily average 70%.

Do these look like the same town to you?

Which one is real?

Which one has been accurately recorded by the revaluation process coming to a conclusion in the next few weeks?

The residential one? The commercial one?

Both?

Neither?

Right now, to me, both Trentons depicted by this revaluation seem equally fantastic and not very credible. These are fairytale versions of the town we think we live or work in, thanks to ASI and the Jackson Administration.

Welcome to La-La Land.



The Christmas Mayor

If he seeks re-election next May, Trenton’s Mayor Eric Jackson will likely run on a record of bringing redevelopment money into Trenton. He has to hope that he will get all the acknowledgement, and votes, that he needs from getting money in, because he has been horrible at managing it once it’s here.

Like a benevolent Santa-Claus-in-Chief, the man relishes the opportunity to announce presents and gifts to the people of the City of Trenton, even when he is only standing by the people who actually make them possible. That’s Mr. Jackson standing behind Governor Chris Christie as the governor announced a grant of $13 Million in state money to tear down abandoned buildings in the City. That’s him again, standing behind the Governor as Christie gave another $9 Million to the City for new housing. Hey, how about when Christie gifted the City with $18.5 Million for a new park and a (snicker!) Bridge connecting this park to downtown Trenton? Yep! Another $2.4 Million for the City’s Cadwalader Park? Hmmm,  there doesn’t seem to have been a press conference for that one.

There’s been a lot of largesse from the State of New Jersey in the last few months, almost $43 Million Dollars in the preceding paragraph alone. How come? Is all this money really due to the diligent efforts of our Mayor and his Administration? Perhaps, but I think these grants have more to do with Chris Christie than Eric Jackson. Whatever the reasons he may have – creating a “legacy;” banking some political good will for another possible presidential run in 2020; giving back to Trenton a fraction of the $150 Million or so in aid the City would have received from the Capital City Aid program he canceled in 2010 when he took office; or perhaps rewarding Mr. Jackson for not rocking the boat during his doomed presidential campaign and for not opposing the state’s plan to downsize the state’s downtown building footprint, a plan bitterly opposed by a group of downtown business owners – Chris Christie is the reason for these recent grants, and not Eric Jackson.

Enough about Christie. This is supposed to be about our Mayor. Governor Christie has done a huge favor for Eric Jackson, gifting him with several sizeable grants to Trenton at a time that will help Jackson’s own re-election campaign, which so far remains unannounced. Mr. Jackson, in turn, gets to give presents to the City’s voters, playing Santa in the Summer.

It hasn’t been just government grants that Mr. Jackson is happy to publicly promote. When a developer announced plans last fall to re-develop the old Trentonian newspaper building on Perry Street as a Dunkin Donuts bakery, the mayor couldn’t wait to pull that be-ribboned box from under the tree. He very prominently tore the wrapping off that one at a MIDJersey Chamber of Commerce meeting in October of last year. “They’re planning to create almost 200 new jobs in our city. When Trenton attracts new business and jobs our local economy is stronger, people go to work and our city gets stronger.”

But, as often happens the day after Christmas, if the presents are the wrong color or the wrong size, or need different batteries, or need to be returned, it’s hard to find this mayor to go back to the mall and face the crowds. For instance, last night The Trentonian published an article that described the Dunkin Donuts project as “dead.” In that piece, reporter David Foster wrote, “The mayor did not return a message seeking comment.”

Similarly, last year in the middle of an upsurge in violent crime in the City the Mayor staged a big outdoor press conference with local, county and state law enforcement and elected officials to announce a “bold” plan to combat that upsurge. However, as described in this space last year, that plan itself had significant problems.

A year later, this fuzzy plan – announced with great fanfare and public pomp – has had rather predictable results. Crime in Trenton is again spiking, and the Mayor’s response this summer has been… a press release. Rather than make another public appearance on the matter that might leave him vulnerable to awkward questions and comments about the lack of progress over the last three years, Mr. Jackson instead released a mealy-mouthed statement after the recent shooting death of 15-year-old Kyler Bragg. In that statement, Jackson devoted only three lines to Kyler Bragg and his family, before pivoting away: “This local and national crisis requires a significant alignment of interest that are working comprehensively toward a solution to end this violence. I believe that complex public-policy challenges cannot be solved exclusively by elected officials.” He talked briefly about 12-hour shifts for police officers, a task force of more than 30 officers, and hey! “the help of funding authorized by Governor Chris Christie and New Jersey State Attorney General Christopher Porrino” to install video surveillance cameras around the city. New money! Grants! He finished up by reminding us, in case we didn’t know, “Unfortunately, crime is ever-present in our society.”

No shit!

It’s easier for Mr. Jackson to invoke the “ever-present” nature of crime in this “local and national crisis” than it is to face up to things that need attention in his own administration. As one recent example of this, last week a year-old video surfaced of Public Safety Director Ernest Parrey using racially-loaded language to describe some of Trenton’s residents. Mayor Jackson took no action with Director Parrey, dismissing the incident as merely a “bad and extremely poor choice of words” as reported in The Trentonian.

Just as no action was taken by the mayor a year ago, when Mr. Parrey was the subject of a City Council disciplinary hearing.

Just as no action has been announced by the Mayor in the aftermath of a report issued last week by the NJ Department of Environmental Protection (DEP) that last month’s water quality incident affecting thousands of Trenton’s residents was caused by “‘technical, managerial, and operational deficiencies’ within the Trenton Water Work’s Water Treatment and Distribution systems ‘that need to be addressed.’” As The Trentonian’s David Foster wrote last week, “In a statement at the time, Trenton Mayor Eric Jackson said that the problem arose from a technical issue at the city’s water treatment plant that caused chlorine levels to temporarily drop.” DEP has shown the mayor’s “technical issue” to be one that also involved “managerial and operational deficiencies;” that is, people and process issues that can be addressed and hopefully fixed.However, this Mayor, a former Trenton Public Works Director with prior direct responsibility for the Trenton Water Works, a utility that’s had more than its share of problems over the last several years, has been silent over the last week about issues that DEP reported “need to be addressed.”

Just as the Mayor has been silent about problems with the US Department of Housing and Urban Development that led to the City having to give up over $3 Million in future grants because of past inappropriate spending and the Jackson Administration’s three-year failure to fix managerial and operational deficiencies in its administration of Federal grants.

Just as the Mayor was silent for a year after it was revealed a city vendor had been able to swindle nearly $5 Million in City payroll tax deposits, because of managerial and operational deficiencies in its financial departments.

Just as…

You get the picture.

Over and over again over the last three years – and at a pace that is likely to accelerate over the next year as we approach the next municipal election cycle – we’ve been treated to many virtual Christmas mornings, as our mayor has brought great tidings of joy, and new money, and grants, and grand initiatives.

But over and over again, we’ve seen how this mayor and his administration have been utterly incompetent in the day-to-day management of the City of Trenton. We’ve seen that all too frequently over the last three years, and again over the last week.

Eric Jackson is a Christmas mayor, great with glitter and fancy wrapping, horrible with everything else.

For Those Keeping Score at Home

It’s been awhile since we’ve updated the ERA’s for Trenton’s last few mayors including the current one, Eric Jackson. Since Mr. Jackson will presumably look to get a contract extension, we should probably take a look at his current stats, don’t you think?

You may recall that we started calculating this statistic six months ago, as a quick and handy reference to citizens for assessing how much taxpayer money the last several mayors have ended up costing the City of Trenton. I call it the Mayoral “Earned Run Average,” after the baseball term used to calculate pitchers’ effectiveness. I first roughly calculated the ERA’s for Mayors Palmer, Mack, and Jackson – all Starters – and Muschal as a Reliever, at the beginning of the year. When last refined and updated on January 19, the stats stood as follows:

Palmer -7.98

Mack – 5.33

Muschal – 1.53

Jackson – 8.93

I’ve updated the stats as follows: First, there’s $3.3 Million amount of federal funds, that was misspent and to be recouped by a Voluntary Grant Reduction, as first reported in this space on May 31, and picked up by the Trenton Times on June 18. This money, $3,332, 313 that – according to Trenton Mayor Eric Jackson – was disallowed by HUD after examinations made of the Community Development Block Grant (CDBG) program books covering the period 2007-2013. This money will be made up by a Voluntary Grant Reduction, HUD taking that money back  by reducing the grants we normally would have received by $1.1 Million per year for each of the next three years.

And, $2,431,095 is the amount of funding not spent by the City from 2007-2017 as written off by City Council in several actions taken over the last 15 months since March 2016. This is federal money the City could have spent, but didn’t.

I have charged equally to Doug Palmer and Tony Mack. The funds were spent during their tenure, and I don’t have any document in my possession that breaks down the sources of that $3.3 Mill more precisely by year. So, I’m splitting that amount in two.

The $2.4 Million in funds written off as not-spent is harder to score, admittedly. Most of these grant funds predate the Jackson “Team’s” time on the field, true. And a lot of these funds were old enough, from prior fiscal years, that they probably couldn’t have been used by this Administration during its term last three years, anyway. The effort to untangle a decade’s worth of administrative chaos in Trenton’s management of this program was considerable.

And yet. These monies sat on the City’s books for all of the three years of the current Administration, not used, and not otherwise put into play by the City, to possibly – for instance – offset the other, disallowed expenses. For the better part of three full years, during which time the City’s relationship with HUD became much more fraught and frustrating (from at least HUD’s perspective), the only action the City felt it could take was to write off nearly Two and a Half Million Dollars in unused Federal funds. In fifteen separate Council actions, about one a month, since March 2016.

And all of those actions, while on publicly announced City Council dockets, taken as secretively as possible, with no further information or explanation given in the dockets or accompanying Resolutions. With the individual amounts of monies written off small enough to be lost in the background noise of other routine Council business. Which was likely the intended result for the way these write-offs were handled.

And that is why I have charged $2,431,095 to the Earned Run Average of Eric Jackson. He may not have put that amount of money into the game, but in the secretive way he and his Administration handled this entire HUD/CDBG matter for the last three years, he certainly put that money in scoring position. And City Council allowed it to come all the way home, all of fifteen times.

The next item to consider doesn’t fall in the category of taxpayer funds wasted, but rather funds the City could have earned, but didn’t. The term for this is an “opportunity cost,” and in business terms it’s just as real as money in the bank. Except, it never shows up in the bank. Put another way, it’s a sure thing that you screwed up.

In this case, it’s $3.5 Million that the City could have earned over the last three years in Vacant Property Registration Fees. According to a study conducted by the Trenton Council of Civic Associations, as reported by Cristina Rojas of the Trenton Times,

In November 2014, City Council approved an ordinance to create a vacant property registry, part of the administration’s five-point plan aimed at reducing the some 6,000 vacant buildings and lots in the city… [R]records obtained by the Trenton Council of Civic Associations show that many vacant properties have gone unregistered and the city has not followed up. A citywide property survey conducted by [[the local coty Non-Profit organization] Isles in 2014 found there were 3,566 vacant buildings, 339 of which were owned by the city. In 2015, owners of 1,305 vacant properties, or 40 percent, had registered, TCCA’s report says. A year later, that number dropped to 1,175 and, by March of this year, only 370 had registered.

The city collected $876,551 in registration fees over the past three years, but TCCA estimates that had all vacant properties been registered each year, the city could have collected $4.4 million. There are also penalties if an owner fails to register or follows the rules, but the records provided to TCCA suggest that the city has not issued any fines.

The difference between the money the city actually raised in registration fees – $876,551 – and the amount it could have – $4.4 Million – is the opportunity cost. This is Three and a Half Million Dollars that could have been earned from an ordinance and a program that was the Jackson Administration’s own idea!!

Ouch. That sure doesn’t look good for the Jacksons. Compared to the HUD problems which, as I’ve stated before, largely predate the current Administration, this Vacant Property Ordinance and its lax enforcement was an early and high priority of this Administration.

And, they blew it.

In her Times article, Ms. Rojas features quotes by the City’s Director of Housing and Economic Development Diana Rogers defending the City’s record in this matter. But I am not going to bother including any quotes here. You can read them in the Times, if you haven’t yet satisfied your Minimum Recommended Daily Requirement of bullshit today.

So, it’s been almost six months since the last calculation of Mr. Jackson’s ERA. At that point, his average was a poor 8.93, a stat that would surely earn a trip for Mr. Jackson back to the minor leagues, if not into retirement. With another six months now passed, what have these recent charges done to our Starters?

Read it and weep.

trenton era 7-4-17Mayors Palmer and Mack have seen their averages creep up a bit, to 8.95 and 5.38, respectively, when charging off their share of the mis-spent HUD money.

But Eric Jackson jumped into double-digit territory, from his previous dismal 8.93 to a truly Hall-0f-Shame-eligible 15.38!!

With another 12 months in this guy’s term, you have to wonder if there is anything he can do to bring that number down, or whether he (and we) are doomed to to see nothing but more mayoral hits, runs, and errors continually charged to his record.

All kidding aside, we are three years in to the Jackson Administration. As the City prepared for its next round of municipal elections next May, it is impossible to ignore that Eric Jackson’s record of these three years is pathetic. Millions of dollars wasted, from:

  • payroll theft;
  • hiring of unqualified vendors;
  • mismanaging other vendors;
  • screwing up the relationship between the City and one of its main federal funders;
  • tens of thousands of certifiably unauthorized administrative spending;
  • and now this, fucking up one of its own cherished redevelopment initiatives.

Not much of a record to run on, I’d say. One that’s to impossible to defend. That’s the Eric Jackson record.

“This Is a Daily Process”

That’s a quote from City of Trenton Director of Housing and Economic Development Diana Rogers, as included in an article by Cristina Rojas in today’s Trenton Times, describing the loss of over $3.3 Million Dollars in future funding from the US Department of Housing and Urban Development (HUD). This loss, first reported in this space on May 31, will come in the form of a Voluntary Grant Reduction (VGR) of $1.1 Million for each of the next three years, reimbursing the Federal Government for funds improperly spent by the City during the prior administrations of former mayors Douglas Palmer and Tony Mack.

Today’s Times article revisits much of the same material that you may have read here over the last few weeks. Ms. Rojas acknowledges that her article is based on the same documents I received from HUD in May as the result of a Freedom of Information Act request I filed with the agency. Today’s article dwells entirely on the $3.3 Million VGR request, and did not mention an additional $2.4 Million in unused federal funds from the fiscal years of 2007-2017 that was written off by the City as unspendable.

Ms. Rogers spoke at length to the Times about the subject, adding as new information that this past May HUD representatives visited the City for a “monitoring visit,” the first since 2014. At that earlier meeting, and another in 2010, HUD’s inspection and auditing discovered the problems which resulted in disallowing the $3.3 Million in improper expenses.

A report detailing findings from this latest visit should be sent to the City in the near future. At that point we expect to find out the answer to the questions I asked on June 8. Whereas all of the disallowed expenses at issue now predate the current Eric Jackson Administration, this most recent monitoring visit will examine the last three years of the City’s management of more recent Federal funding. I wrote:

[W]hat fresh problems might a new monitoring visit uncover? What new grant problems might be lurking in our financial books, waiting to be uncovered?

Can this Administration assure us there aren’t any?

Could we believe such assurances?

We will find out the answers in the near future, it seems.

For her part, Director Rogers looks forward to a pretty clean report.She told the Times that the City has been cleaning up its act for the last few years:

[C]hanges have included keeping better records, requiring more documents to back up costs, providing subrecipients with additional training and manuals and working more closely with the finance department to reconcile accounts.

Consultants have also been brought on to help the three-member staff develop and submit the annual and five-year plans, do environmental reviews, visit properties for the housing rehabilitation program and work with contractors.

“This is a daily process,” Rogers said. “This is not something that we’re sitting back and just kind of letting go. … If you were to look at files now versus previous files, it’s a world of difference in terms of the amount of documentation we maintain now to support the dollars that are being spent.”


I hope that the Director’s optimism is well-founded. I hope this latest monitoring visit finds no new problems, and only progress toward finally resolving old ones.

And I am glad that Ms. Rogers spoke on the record with the Times. After initially requesting a meeting with me to discuss my findings, she failed to respond further after I asked to record any such conversation, for the record.

I am disappointed, however, in one voice NOT heard at all over the last several weeks since this problem came to light. Just as he remained silent for over a year on the matter of the aftermath of the Innovative Payroll Services (IPS) theft in 2015 of nearly $5 Million Dollars of City Money, Mayor Eric Jackson has said not one word on the long-running problems the City has had with HUD and other Federal agencies. He hasn’t explained to the people of the City what the Federal designation of Trenton as a “High Risk Grantee of Federal Funds” has meant to the way the City has administered its programs and services since we were tagged with that label in 2015.

Mayor Jackson has shown over the last few weeks that he is happy to appear in public to share good news, even when it’s not of his making, such as when he appeared with Governor Christie to announce new state funding for Trenton’s parks, or when he again appeared with the Governor to announce state funding to demolish several vacant and crumbling City-owned houses and buildings. When there is good, photogenic news to share, Eric Jackson is all over it.

But when the news is bad, Eric Jackson is nowhere to be found.

Since the IPS scandal broke, the Mayor ignored several requests, made in this space and via direct email, for him to explain what actions were being taken to ensure that such theft by city contractors could never happen again. He maintained radio silence up until the day he was directly asked, face-to-face, at a neighborhood meeting, and finally could no longer duck the question.

I am glad that Director Rogers went on the record, on behalf of the Administration, to explain the HUD problems. But I think that voice in the Times should have been Mayor Jackson’s, not one of his Directors.

And I think the Administration should have informed Trenton’s citizens of this kind of problem much earlier, on their own, before being pressed by revelations made by the press and by one lone blogger. My emails to the City asking for comment and answers on the HUD matter, responded to by Director Rogers, were also addressed to Mr. Jackson. I haven’t received one reply from him. And that’s been his SOP for the last three years.

In two instances now, one involving a theft of FIVE MILLION DOLLARS, and one involving paying back THREE MILLION DOLLARS, Eric Jackson hasn’t said a word. If he won’t talk about problems worth this kind of big money, what will he talk about?

Keep these things in mind over the next several months. We have city elections again next Spring, and movement is already under way for what will be some interesting campaigns. I suspect that the recent “good news” announcements over the last weeks – especially by a Governor who has hardly given a shit for this town for over seven years – might be conveniently timed to give a early pre-election boost to Mr. Jackson’s re-election fortunes.

Keep this in mind, as you decide if Mr. Jackson’s record over the last three years will lead you to lend your support to him for another four.

I’ve already decided. In my humble opinion, a man who will only claim the spotlight to share in the good news or the accomplishments of others, and who then shuns it in the aftermath of bad news to avoid accountability, is providing Poor Leadership to the people of this City. There are simply no other words for it.

Claiming credit for Good News – and owning up to the Bad – is also part of the “Daily Process” of government. The one goes with the other, in equal measure. Or, it should. We don’t see that from this guy.

Based on these last three years, Mr. Jackson has not earned another term as Trenton’s mayor.

SNAFU - Trenton and HUD

The page on Trenton’s City Website describing its participation in the US Department of Housing and Urban Development’s (HUD) three ongoing annual funding programs for local communities such as ours is pretty straightforward. The three programs are:

  • The HOME Investment Partnership (HOME), funded in the amount of $551,008 for the current fiscal year ending June 30;
  • The Emergency Services Grant (ESG), funded at $213,526 this year; and by far the largest program of the three,
  • The Community Development Block Grant (CDBG), in the amount of $2,260,396 this year.

The City’s CDBG (for the sake of simplicity, I will use “CDBG” as shorthand for all three of Trenton’s grants from HUD, except when it is important to distinguish them) webpage says of these grants,

The Community Development Block Grant (CDBG) Program is authorized under Title I of the Housing and Community Development Act of 1974, as amended, and was enacted in 1974 under the Housing and Community Development Act or HCDA. The primary objective of Title I of HCDA is the development of viable urban communities. These viable communities are achieved by providing the following, principally for persons of low and moderate income: decent housing; a suitable living environment, and expanded economic opportunities.

To achieve these goals, the CDBG regulations set forth eligible activities and the national objective that each activity must meet. As recipients of CDBG funds, grantees are charged with ensuring these requirments [sic] are met. [Emphasis mine - KM]

As I said, it sounds pretty straightforward. Grantees such as Trenton are supposed to supposed to know the rules and applicable law covering these programs and making sure they are well followed. Followed both for work performed directly by the City, and by other community-based organizations to whom Trenton makes direct sub-grants.

Well – and you know where I am going with this – that’s precisely where Trenton has had problems. For years.

Let’s go back to August 2014, shortly after the current Administration of Eric Jackson began its term on July 1, representatives from HUD visited the City to conduct what they call a “monitoring visit,” a review of several specific projects being undertaken by the City with federal funds, but more importantly a review of the City’s administrative practices in managing and overseeing these programs. In a report sent the next month, on September 30, HUD concluded this about the City’s CDBG program (page 7):

“Our review disclosed that the City’s program is having significant difficulties. Our review disclosed that the City’s program does not have systems and procedures in place to ensure that staff is knowledgeable of CDBG program requirements, subrecipients are meeting the program requirements, program benchmarks regarding timelines are being achieved, and documentation regarding individual activities is being maintained to track progress and compliance. Overall, the City of Trenton has not demonstrated the capacity to continues carrying out the CDBG program and strongly recommend the City seek out technical assistance to try and continue its program in a viable manner.”

Inside that report, HUD detailed a total of 26 findings for its three programs that provided the basis for that scathing conclusion. Typical of their findings was #8, which can be found on Page 16. HUD’s monitors had during their August visit randomly selected a number of activities and vouchers (payments) from the CDBG program to determine if they complied with the program. The random sample consisted of 21 vouchers totaling $1,994,154.60 in costs.

Of those vouchers, HUD determined that a number of vouchers “were not necessary, reasonable or allowable,” and struck off $1,264,508.30 in costs as disallowed. That is almost two-thirds of their random sample, a massive proportion. Some or all of that $1.264 Million was likely included in the amount of $3,322,313 that Mayor Jackson cited in his letter of December 20, 2016 requesting a Voluntary Grant Reduction (VGR) in future CDBG grants instead of paying back all those disallowed costs to the Federal Government.

That September 30, 2014 report was extremely  damning, and indicates that the new Jackson Administration was inheriting a very problematic relationship with HUD. Four years prior, in 2010, HUD had conducted a similar monitoring visit and had issued a pretty scathing report in 2011. However, during the chaotic Tony Mack years, nothing was done to improve the “significant difficulties” found between 2010 and 2014.

With the arrival of the Jackson Administration, HUD was clearly running out of patience. In its letter of 9-30-14, HUD’s regional Director of Community Planning and Development Annemarie Uebbing a deadline of thirty days to respond with a detailed plan to address their findings. That reply was sent to Uebbing on October 29 by the City’s then-Director of Housing and Economic Development, Monique King-Viehland, containing a detailed plan responding to each of HUD’s 36 findings. Here is an excerpt from that plan:

10-29-14 action plan

You’ll notice that the Finish dates for these tasks ranged from mid-November 2014 to the end of March 2015. That was true for all of the remaining items listed over the next three pages. That was the commitment made by the Jackson Administration to fixing the City’s broken CDBG system and repair the relationship with HUD that had been seriously strained during the Mack years. This had been one of the main planks of Eric Jackson’s campaign, you will remember. Mr. Jackson promised “to clean up the mess left to him or her, but will have to restore the faith and trust Trentonians have rightly lost in their municipal government.”

He didn’t made much progress on that score. As 2016 began, 19 months into the Jackson Administration, HUD took the City of Trenton to the woodshed. Ms. Uebbing wrote on February 2,

“…HUD has concluded that the City of Trenton has significant issues with the administration of its HOME and CDBG programs. Therefore, the City has been identified as a High Risk grantee, pursuant to 2 CFR 200.205. The ‘High Risk’ designation results from the City’s: (1) history of unsatisfactory grant expenditure performance; (2) weak management and reporting systems; and (3) inadequate staffing and program oversight – all of which undermine, successful CDBG and HOME program performance, which have contributed to the loss or risk of loss of funds.”

The City did make some attempt to improve. In 2015, it hired a consultant to help with writing and executing its annual and 5-year plans. But it couldn’t get its act together. As late as February of this year, HUD was still after the City to make good at fixing its problems, and was implicitly – but pretty obviously – tying its still-pending decision on whether or not to approve the Mayor’s VGR request to the City’s ability to fix its broken system. Here’s the key paragraph in a letter dated 2-23-2017 from Director Uebbing to Diana Rogers, the City’s current Director of Housing & Economic Development. It’s not very subtle:

“On December 20, 2016, the City submitted a request for a Voluntary Grant Reduction (VGR) in Lieu of Repayment for Ineligible Expenses. The CDBG grant reduction request was for $3,332,313 and would reduce the City’s FY 2017, 2018 and 2019 grants by equal amounts. The City’s VGR request is still under review along with HUD’s review of the City’s untimeliness [See below]. Upon completion, HUD will inform the City of its determination on both issues in a separate letter. We encourage the City to continue to take actions to clear all findings identified in our September 29, 2011, September 28, 2012, and September 30, 2014 monitoring review letters.” [Emphasis mine - KM]

Translation from Bureaucratese: “That’s a nice VGR request you have there. Sure wouldn’t want anything to happen to it!!”

A quick note on the “untimeliness” referred to above. HUD has what is called a “timeliness” standard that tries to ensure that a grantee city such as Trenton actually spends its government grants efficiently and on a timely basis. HUD wants their funds to get applied in the community as intended by the laws that created their programs.

Because there are some overlaps between grant years and delays in reporting and payments, there may be funds available from more than one grant year in a city’s account at any one time. The standard used is measured 60 days before the end of a grant year, and says that at that date, a city should have in its HUD account no more than 1.5 times the amount of its annual grant. Having balances significantly higher than that leaves a city open to various sanctions and penalties. For the program year 2013, the City was falling behind in its timeliness, with a factor of 1.9 for its account. Remember, this was during the Miserable Mack Years!

However, during the Jackson Administration, that measure has only gotten worse. As stated in the 2-23-17 letter, on June 30, 2015, the number was 2.42 the annual grant. On June 30, 2016, the number had jumped to 3.32. This means that the City had over the equivalent of over 3 years of CDBG funds unspent. This is one of the ways a City such as Trenton becomes a “High-Risk Grantee” of federal funds, which Trenton is. And that likely explains why City Council has written off $2.4 Million in unspent CDBG funds dating back to 2007, as first reported here a few days ago.

In February of this year, with the letter excerpted and linked above, HUD also sent a table, called the “CDBG Activities At-Risk Dashboard” listing no fewer than 59 outstanding items from current and prior project years that needed action by the City in order to clear old accounts and get back to anything like a current basis with HUD. Here’s a sample page:

CDBG At-Risk 1

You’ll notice the column labeled “FO Due Date.” That’s the deadline HUD set for the City to submit its plans to the local HUD Field Office (FO) for settling and closing all of the 59 items. All of the dates were May 11 or May 15 of this year.  The “Target Completion Date” in August is the deadline set by HUD for the City to follow through on its plans and fix the 59 problems.

Last week, I wrote to Director Rogers and Mayor Jackson asking, among other things, if the City had met its May deadline for submitting its plans, and if it would also meet the August deadlines for follow through. In reply, without answering my question, Director Rogers offered to meet to discuss the CDBG program. I agreed, but only if I could record the meeting. I have not heard back from her since then.

Look, this is a complicated subject. Even with all of the documents linked above, this is only a very cursory review of the relationship between the City of Trenton and an important federal agency providing a good deal of annual funding that the City can use itself and also make sub-grants to local community organizations with a great deal of flexibility. The main obligation the City has, as mentioned at the top of this piece, is to ensure  that HUD’s rules and regulations are followed, and that projects we spend their funds on serve the “national objectives” outlined in the laws establishing these programs.

But those requirements are what Trenton has consistently, for years, failed to meet. As one result, we are now on the hook to either repay over $3.3 Million Dollars in disallowed expenses, or lose that amount from future grants. As another, we failed to spend another $2.4 Million.

That’s about Five and Three-Quarter Million Dollars that we’ve fucked up. That’s not a small amount, even by Trenton’s Fuck-up Standards of the last several years!

Five Million lost in a payroll scam. Five and Three-Quarter Mill in HUD dollars pissed away. A couple of hundred grand extra for swimming pool vendors or IT contracts. That’s normal around Trenton.

You do know what SNAFU means, right? That’s what we have right here.

One final note: as I wrote in my first piece on this matter last week, all of the unspent funds and disallowed expenses at issue here are tracked back to grants in years that pre-date the Eric Jackson Administration, and track back to the in-depth monitoring visits made by HUD in 2010 and 2014. That Department has not conducted a similar monitoring visit since 2014.

We know that during the last three years, the Jackson Administration has failed to improve its administrative practices as it promised HUD it would in September 2014. In fact, measured by at least two criteria – the “timeliness” factor and the City’s 2015 designation as a “High-Risk Grantee” of federal funds – the City has arguably gotten worse under the current Administration.

Which begs the question: what fresh problems might a new monitoring visit uncover? What new grant problems might be lurking in our financial books, waiting to be uncovered?

Can this Administration assure us there aren’t any?

Could we believe such assurances?





The CDBG Shoe Drops

We know a little more this morning about the potential impact to the City of Trenton’s private community-based service organizations of Mayor Eric Jackson’s potential Voluntary Grant Reduction (VGR) plan. This plan, reported in this space on Wednesday, calls for a massive reduction over three years in funds that normally would be expected to be granted to the City from the US Department of Housing and Urban Development (HUD) under its Community Development Block Grant (CDBG) program.

The VGR has been proposed, in Mayor Jackson’s own words, “in lieu of repayment in the amount of $3,322,313.00 for disallowed expenditures determined during the 2010 and 2014 monitoring visits conducted by Housing and Urban Development staff for the program years 2007-2013.”

This annual reduction of $1,107,437 in the project years of 2018, 2019, and 2020 will dramatically impact the CDBG program in Trenton. To put that number into context, for the program year 7/1/15 to 6/30/17, Trenton received $2,371,985 for the CDBG program (see page 9 in this report). The VGR will whack close to 50% off these funds, if it is implemented as Mayor Jackson as proposed.

From the City’s CDBG funds, about $600,000 annually (page 93 of this report) has been sub-granted to local community organizations to help support their public service programs. Among these organizations have been the Trenton Area Soup Kitchen, The Crisis Ministry of Mercer County, NJ Tennis & Learning, and the Shiloh Community Development Corporation (page 22 of this report). Altogether, each year the City receives applications from over fifty organizations, with proposals totaling over $2 Million Dollars. Out of those applications, only $600,000 or so is awarded. Competition is keen, and the City’s selection and award process has been the subject of some controversy over the last few years.

That competition will likely become much more cutthroat after the VGR kicks in. In a memo yesterday emailed to likely attendees of a grant technical assistance workshop being held this afternoon at Trenton’s Council Chamber (forwarded to me by one of those attendees, thank you!), beginning the application process for next year’s CDBG application process, City Chief of Housing Production Marc Leckington announced,

“Due to a voluntarily grant reduction (VGR) the City expects to receive approximately $1.1M less in CDBG funds per year for the next three years. The VGR is the result of negotiations with the Department of Housing and Urban Development to address findings identified in a 2014 monitoring visit. This will, in turn, reduce the Public Service allocation to approximately $100,000 annually.  The final figures are dependent on Federal budget allocations for the CDBG Program.” [Emphasis mine - KM]

The VGR will reduce funds available to these community organizations by about $500,000 per year for each of the next three years, about $1,500,000 in total. The rest, $1,800,000 and change, will reduce the City’s direct expenditure on a wide variety of projects such as: providing home improvement assistance grants directly to eligible homeowners helping them to cure code violations; help operate the city’s Senior Centers and pay for programs there; demolish vacant and abandoned buildings; and help removal of lead in city homes (pages 23-52 of this report).

The potential loss of about half of the City’s CDBG grant for three years – that is, IF Mayor Jackson’s proposal is approved by HUD, and IF the CDBG program survives during the next three Federal budget years – will definitely impact the city and its services. How significant this impact will be is unknown. We may get some taste of it if any report comes out of today’s grant workshop at City Hall. The meeting is in Council Chambers at 1:00 PM, and it’s open to the public, if anyone is interested. If you go, let me know what happens.

Earlier this week, we found out that the Mayor’s VGR proposal, dating to December of last year, and the disallowed program expenses that led to the proposal, even existed. We also found out about another $2.4 Million in CDBG grant funds that were left unspent over the last ten years.

Today, we start to find out what the impact of the Grant Reduction will mean to the future of social services in this City for the next three years. As I’ve attempted to describe above, we won’t know for sure for some time to come, but it’s a good bet it ain’t gonna be good.

Next, this space will start to explore how we came to this sorry situation in the first place. Stay tuned.

More Federal Money Problems for Trenton. BIG Money Problems.

The City of Trenton owes Millions of Dollars to the Federal Government. To be precise, $3,322,313.00, to the US Department of Housing and Urban Development (HUD), principally in connection with its Community Development Block Grant (CDBG) and Home Investment Partnerships (HOME) programs.

This is, in the words of Trenton’s Mayor Eric Jackson in a letter to HUD on December 20, 2016, “for disallowed expenditures during the 2010 and 2014 monitoring visits conducted by Housing and Urban Development staff for the program years 2007-2013.” [Emphasis mine - KM]

jackson 12-20-16 grab

In addition to this money we owe HUD, over the last 14 months the City of Trenton has, in 15 separate Council actions from March 2016 up to its meeting a few weeks ago on May 4,  written off another $2,431,094.70 in HUD funds it failed to spend, over the decade of 2007 through 2016. These are funds we never drew down, so they do not require repayment. But this does represent over $2.4 Million in lost opportunity, about a quarter million dollars per year in funds that could have easily been – but weren’t – spent in this desperately poor city over the last decade.

To be clear, all of the “disallowed expenditures” and most of the unspent funds predate the Jackson Administration, and the current City Hall crew have been working since its very first days in the summer of 2014 to address and resolve with HUD the horrible mess it had inherited from  the previous administrations of former mayors Doug Palmer and Tony Mack.

However, after nearly three years of working to clean things up, the Jackson Administration hasn’t made much progress. In a letter to Mayor Jackson dated February 2, 2016, HUD’s regional Director of Community Planning and Development Annemarie Uebbing frankly confronted the Administration, writing,

“The City repeatedly misses deadlines to submit the Annual and Consolidated Plans, annual performance reports, required monitoring review responses and other correspondence, and to respond to HUD requests for information. While many of the deadlines passed during prior administrations, the deadlines that were set and agreed upon since July 1, 2014 have also passed without an adequate response.”

Five months later, in an internal HUD memo to a colleague dated July 14, 2016, Ms. Uebbing had not changed her opinion. Addressing Marion Mollegen McFadden, HUD’s then-Deputy Assistant Secretary for Grant Programs, Uebbing wrote,

“We concur with the City that many of the timeliness issues begin [sic] with the previous administration, but the current administration has not implemented corrective actions or dedicated the resources required to resolving its timeliness issues. The City has not demonstrated that it has the capacity to run a compliant program…

The City needs experienced leadership and sufficient staff capacity to address outstanding issues, reallocate funds to compliant projects and move the grant programs forward. An analysis of outstanding payments, balances and ineligible activity expenses should be compiled and supported by [sic] the City can move into administering a compliant program. The urgent nature of these issues must be stressed to the Mayor so that all involved parties are aware of the conditions and consequences of the current response level.”

These opinions expressed last year by HUD have not shifted to any great extent, at least up until February of this year, the last month for which correspondence has been made available.

All of the more recent developments – at least those occurring after October 2015 – have occurred under the shadow of the City of Trenton’s designation as a “High-Risk grantee of Federal funds,” in that month. We became aware of that designation in connection with grants administered by the US Department of Justice. Now we know that the “high-risk” label was also applied to the City in all its subsequent dealings with HUD as well. Back in October 2015, I noted the development in this space:

What is clear is that the Jackson Administration – for all of the bold vision and tentative progress outlined in last week’s State of the City Address – still has basic, and significant, problems with many of the day-to-day Basics of running the City’s government. And that is the case even without the excuse of the Musical Chairs and the frequent personnel turnover we saw during the Hunger Games.

Being labeled “a high-risk grantee of federal funds” should be a wake-up call for Mr. Jackson and his Administration to get their act together. We should hear from Mr. Jackson what he – with I would hope as frequent a use of the first person singular pronoun as he used in the State of the City Address – and his Administration will do, and when they will do it, to get back in the good graces of the Federal funders on whom the City relies upon for so much of its funding.

Nothing seems to have changed since then. From October 2015 through today, that Federal Government-wide designation of the City of Trenton has apparently not yet been lifted or changed, and the consequences of that designation continue to affect our dealings with the Federal Government.

All of these developments concerning the City’s current relationship with HUD:

  • The $3.3 Million in disallowed expenses
  • The request for a Voluntary Grant Reduction
  • The potential exposure to repay some or all of that $3.3 Million if the VGR is refused
  • The many missed deadlines to detail corrective actions
  • The absence of “capacity to run a compliant program”
  • The need for “experienced leadership and sufficient staff capacity to address outstanding issues;”

All of these developments have taken place out of the public eye since the Jackson Administration took office. Apart from the very low-key and piecemeal actions taken by Council to write off unspent HUD funds, there has been absolutely no open public discussion, before now, of any of this. Council did conduct at least one closed Executive Session on the topic of the City’s CDBG contract, on December 13, 2016, one week before the Mayor sent his letter to Ms. Uebbing. No details of that meeting have been released, but we can assume that the Mayor’s upcoming proposal may have been discussed in the context of the overall situation with the Federal Government.

The reason for this air of secrecy isn’t at all clear. Relations between the City and Federal governments are – or rather, should be – open and transparent. Nothing we discuss on the City side is intended to be withheld from the Feds, and the folks in HUD have been transparent with the City. There isn’t any proprietary nor personal information contained in any of the documents linked above.

The only ones left in the dark about what is going on with the City’s CDBG and HOME funds are the citizens of Trenton, and the many local community-based organizations that have been recipients of these funds over the years. It’s certainly an embarrassing situation for the City and the Jackson Administration. But embarrassment isn’t a legitimate reason for the cloak of secrecy that’s been covering this issue.

So, what happens next? As of today, HUD has not yet responded to Mayor Jackson’s request for a Voluntary Grant Reduction (VGR), as seen in the screen grab above, to resolve the $3.3 Million in “disallowed expenditures.”

What is a VGR? If the Mayor’s request is granted, then means that amount will be recouped by HUD by reducing future HUD grants to the City over a three-year period, about $1.1 Million per year for each of 2018, 2019, and 2020. These years, perhaps conveniently, all will fall after the next city election, during the next Mayoral and Council term of office, and will represent an effective reduction of about 50% in those program grants for those years. A whopping amount. And that’s the best case scenario.

If the Mayor’s request is denied by HUD – not least because there is a significant chance that the CDBG and HOME programs may not exist in those future years, as they are proposed to be canceled outright in the Federal Budget prepared by the Trump Administration – there is a good chance we may have to pay back some or all of that $3,322,313.00. And this situation comes to light only a little over a year after the Jackson Administration faced a payment to the Federal IRS of over $4 Million Dollars that had been embezzled by the City’s then-payroll service, an obligation the City was able to meet only by floating a long-term bond to raise the cash.

Obviously, we don’t want to be in that kind of multi-million dollar hole to the Federal government again, so soon after the last time! But the City has a very limited set of alternatives at this point, having come close to exhausting the patience and goodwill shown the City by HUD over the last several years. And HUD, in turn, faces an uncertain future under a new Administration in Washington most decidedly unfriendly to the kinds of problems faced by the primarily urban communities served by the Department.

This morning, I wrote to Mayor Jackson and Housing and Economic Development Director Diana Rogers, offering them an opportunity to comment on the topic, as well as asking a few additional questions. Director Rogers replied on behalf of the City:

Thank you for your email and interest in the CDBG/HOME program.

As noted this Administration and staff have been aggressively working on the cleanup and reconciliation of past projects and HUD findings. We have made considerable strides to address outstanding concerns while also improving the management of the program with the limited staff and resources available.

The VGR and its impact will be discussed during our required public hearing scheduled for this Friday (June 2nd) as we move forward to plan for HUD approved activities for the 2017-2018 program year.

I will be happy to discuss the improvements to the program, the VGR and the overall program in general.

The CDBG and HOME programs, and their funds, have been vitally important to both the City of Trenton as well as the many community groups in Trenton which have been able to receive sub-grants from the City to conduct their own work in town over the last several years. The future of those organizations is now at risk of being badly impacted by the potential loss of future funds from the VGR proposal. What happens to them?

This is a big, important, complicated issue, one that can’t be adequately addressed in a single piece on this page.

Today’s  piece can serve as an overview of the whole matter, and provide some sense of scope and the issues involved, even if by skimming over the surface of them.

Over the next days, this space will examine the issue, in somewhat greater detail as made possible by the release of hundreds of pages of documentation by the Housing and Urban Development Department – some of which have been discussed and linked in this piece – in response to a Freedom of Information Act request filed on April 7 of this year by this writer. At that time, representatives at HUD’s local New Jersey office informed me that the full file of material concerning the City of Trenton amounts to thousands of pages. The manpower and effort required to assemble and copy it all was daunting, both for HUD and for this writer. Instead, the Department offered “major correspondence between HUD and the City of Trenton related to the CDBG program from 2014 to the present.” This selection has resulted in a more manageable, but still greatly informative, 216 pages.

I hope to shed some light on the background of many of these issues, the programs and activities supported over the years by HUD’s grants to the City, and the problems brought to the surface since 2010, with special attention given to the history of the relationship of the current City Administration with the Department.

It is a compelling story, one I hope you will also find to be important and informative.

City Hall Comes to Cadwalader Heights

On this past Tuesday evening, Trenton Mayor Eric Jackson and several members of his Administration attended the monthly meeting of the Cadwalader Heights Civic Association (CHCA). It was the latest in a series of meetings with civic associations and other neighborhood groups that his Administration have been conducting in 2017. The Mayor was accompanied by Police Director Ernie Parrey, Housing and Economic Development Director Diana Rogers, Public Works Director Merkle Cherry, and Director of Finance (who Mr. Jackson announced is retiring at the end of this month) Ron Zilinski. I’d like to recap some highlights of the evening.

The meeting was conducted as follows: Mr. Jackson gave brief introductory remarks, followed by remarks by Directors Parrey and Rogers, followed by some Q&A. Prior to the meeting, the Civic Association solicited some written questions, which they forwarded to City Hall before the meeting. Additionally, some questions and comments were offered from the floor. The entire presentation was oral. There were no handouts or visuals. Therefore there was no way to review the information presented during the evening.

This format differed from at least a few other local meetings that I’d heard about. For at least one other Association, for example, only advance written questions, seen beforehand and pre-vetted by City Hall, were addressed; nothing from the floor was allowed. I had expected the same format for the CHCA meeting, and was pleasantly surprised that non-vetted questions were allowed, and pleased that they were frankly answered. Of course, given the venue and the format, they were not extensively answered. And, in one case, perhaps not accurately answered. But, I appreciate the effort put in by the Mayor and his Cabinet in attending this, and the other, neighborhood meetings. Three years into the current electoral cycle, and looking at the prospect of the next one starting up only a couple months from now, may enter a wee bit in to the impetus for this city-wide tour right now, after all.

The Mayor’s remarks gave some big picture context to what his Administration has accomplished. Overall crime, despite some periodic spikes, is down 9% during his term. Nearly 1000 new, market-rate residential units will be coming online within the next 18-24 months, as well as several tens of thousands (I was taking notes and missed his number) of square feet of commercial space in the same time. He named the upcoming CML plant (the upcoming Dunkin’ Donuts facility on the old site of The Trentonian’s offices), expanded facilities for The Hibbert Group, and the recently-announced move to Trenton by Maestro Technologies as positive developments. He also stated that Trenton’s School District has improved the high school graduation rate of its students from 51% to 80%. The Mayor also noted the ongoing construction of the new Central High School as a positive development, and mentioned that Mercer County Community College is pledging its support to provide job training and development services to local residents to support placing them in these new companies setting up shop.

Director Parrey was next up, to provide a couple of bullet points (sorry, I couldn’t help myself). He said that the Trenton Police Department’s roster would stand at 262 officers upon the graduation of the current Academy class. In order to address one of the ongoing public safety issues in the city – the tendency of many of the criminal actors to be those between 14 and 18 years old and not well served in the current courts – he and his department are working with the State Justice Department, the Juvenile Justice Commission, and Municipal Judge Marc McKithen to set up a Youth Court, similar to Newark’s, on a trial basis (OK, I will stop). And both he and the mayor promoted the use of the “My Block” program for residents to report non-emergency neighborhood nuisances. Please note, My Block is NOT intended to report bad local puns.

Housing and Economic Development Director Rogers spoke about some initiatives in her department. She mentioned that a 6.9 acre property (I THINK the same site Maestro is going into; again, I was taking notes, and missed that part) was acquired for the City from the NJ Schools Development Authority. She also said that there is active interest in properties near the new Nursing School Building belonging to Thomas Edison State U, as well as in the Mercer Campus site previously operated as Capital Health Center. She mentioned that she anticipates convening an upcoming community meeting to discuss plans for the Campus; which, as I wrote the other day, would bring us right back to the same place we were in back in February, 2010. The more things change…

Then Ms. Rogers said she wanted to answer a question that had been submitted prior to the meeting, which may have been one of mine. I had asked, about the reported $17 Million in tax credits and subsidies Maestro would receive in order to bring them to Trenton, how much of that $17 Million was City money. In my written question, I referenced that the State’s Financial Incentives programs, as described in the NJ “Economic Opportunity Acts” of 2013 and 2014 includes a 10-year abatement of all local property tax payments, followed by another 10-year period during which local taxes would be progressively phased in, at 10% a year.

With that as context, Director Rogers said she wanted to say that no city resources were being used as part of these incentives. ALL of the incentives were coming from the state. I was wondering whether she meant that was true only for those projects she had just mentioned, or for the State incentives program in general, when she then doubled down. She said the State program was “designed” to benefit communities such as Trenton, and Camden, by not requiring local contribution to these incentives.

Now, I knew that couldn’t be right. I wanted to ask her about her statements, then and there. But I figured I probably only had a chance for one bite at the apple, and wanted to reserve my chance for a question to Mayor Jackson. So I followed up with an email to Ms. Rogers on Wednesday. I won’t include the whole letter, but here’s an excerpt, which was based on a piece I wrote back in 2013:

In its “Legislative Fiscal Estimate” prepared for the Economic Opportunity Act of 2013, the Office of Legislative Services included this Statement: “The Garden State Growth Zone (GSGZ) property valuation exemption will result in significantly reduced property tax revenues for the cities of Paterson, Passaic, Trenton, and Camden to encourage potential development which may not occur without GSGZ incentives.” [Emphasis added]

This negative impact on the Garden State Growth Zone communities has been well known since the first Act in 2013, and to my knowledge was not rectified in the Act of 2014. Since this effect was explicitly discussed by the Office of Legislative Services prior to the Act’s adoption, this negative fiscal impact must be a considered a feature of the state’s incentive programs, and not a bug.

In light of these considerations, can you please clarify your comments from yesterday evening that Trenton does not contribute to these project incentives?

As of this morning, March 24, I haven’t received any reply or acknowledgement of my note from City Hall. Until then, I will continue to believe that Trenton’s Director of Housing and Economic Development has some major misconceptions about the nature of New Jersey’s economic incentive programs and how they impact the city she works for.

After Ms. Rogers, the Mayor opened the floor for questions, to him or any of his colleagues. The first question asked when the City’s Cadwalader Park would be cleaned up. Not simply have trash removed, but things such as years of accumulated dead leaves and fallen trees. PW Director Cherry’s response was essentially that the City was working on it.

The second resident posed less of a question than an impassioned plea for advice from the mayor and his team: how, after ten years in the City and our neighborhood, could he think to stay in Trenton with the very serious quality of life issues that he had to deal with. He mentioned a suspected crack house two doors down from his, and a shooting at his corner that very afternoon, an incident that Director Parrey acknowledged.

The neighbor was upset, and his question really went to the heart of all of Trenton’s problems. When drugs and violence are literally on your doorstep, how can you tolerate staying here with family and loved ones? Mr. Jackson and Mr. Parry talked to the man sympathetically, and generally. Mr. Parrey took the address of the suspected crack house, said he was unaware of any problems there, but would look into it. He and the Mayor tried to put our neighborhood’s concerns in some context. The same problems could be found on a daily basis in the Mayor’s Villa Park neighborhood. Public safety is an ongoing issue in all communities, not only Trenton. The City is working on the problem from many directions, including on the street with the Police Department, in the Courts and with County, State and Federal resources, as well as with local neighborhoods and residents, all of whom have a stake in keeping the city safe. Our neighbor was encouraged to stick it out, in hope of better times. Mr. Jackson and Mr. Parry were sympathetic and sincere; I don’t know how reassured my neighbor felt, but I certainly understand that they deal with these issues and incidents like these every day, in every city neighborhood. My neighbor expressed that he was thinking about whether to leave the city for good. He, I and many folks in the City can consider leaving as an option; for a lot of other people, that alternative isn’t so simple. The problem is to make all Trentonians feel safer where they live and work.

I asked the mayor about the Audit and internal review of procedures and policies he announced over a year ago, in the aftermath of the $5 Million Dollar theft of city funds by Innovative Payroll Services (IPS). Since that had been the last public mention of that audit, could he please give a brief summary of the results of that review, and of any actions taken in response. If he couldn’t provide a brief summary that evening, could he please commit to a fuller explanation at a later date?

This was the first time I had asked the mayor about this matter since sending am email to him in March 2016, to which he did not reply. To my pleasant surprise, he answered my question at some length and with some candor, which to my knowledge is the first time he has publicly addressed the topic at all since his press conference of March 14, 2016.

The Mayor quickly reviewed the matter, stating the City had been the victim of a crime by an unscrupulous individual. He said something also about this theft happening at a time one year into his term,  when his Administration was still, according to him,  settling in to City Hall, and learning the nuts and bolts of city administration. He did reveal a few things that the City has done in response to the internal and external reviews and audits. Principally:

  • Payroll tax deposits, previously handled by the intermediary of the city’s Payroll Services vendor, are now made directly to State and Federal tax authorities by the City. This is a wise move, and good business practice that should have been instituted years ago/
  • Two unnamed individuals have been disciplined for their performance during this theft. He did not name the persons, nor describe the discipline, citing personnel confidentiality. Presumably they are Janet Schoenhaar, the City’s Comptroller, and Mary Henry, a City Accountant. These are the only two City names on months of emails between the City and IPS in 2015 discussing frequent delinquency notes and penalty invoices received from the State and Feds. If these employees were the ones referred to by the Mayor, they are seasoned city employees of long tenure, not recent Administration hires settling in to their jobs and learning the nuts and bolts.
  • Additionally, the Mayor said, and was seconded by Finance Director Zilinski, that a large amount of the funds stolen by IPS have been recovered.

He didn’t provide any further details during the little time remaining in the evening. I was glad to finally get some information from the mayor on the matter, and thanked him for addressing it. I do hope this means the mayor may be more forthcoming on this matter, more publicly and to more Trentonians than were able to hear him in our small group on Tuesday.

I thank the Mayor and his colleagues for attending on Tuesday. I hope this represents a new stance on communication and accessibility that will be continued. That this is happening three years into their terms in office is, I suppose, just one of those things.