The Real Tax Increase for New Rochelle Homeowners is 15 Percent

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In the December 29, 2011 issue of the Westchester Guardian
     An increase of the street repair fee from $245 to $295 by the New Rochelle City Council added $50,000 to the proposed 2012 budget.  The City Council then considered a possible solution to a question of Councilman Richard St. Paul at their last meeting about what can be done to attract retail development to the City. The Commissioner of Development, Michael Freimuth, presented a plan costing $100,000 to hire an independent consultant and emphasized this position would call for special skills.  He elaborated that a "serious deficiency" in the development process is connecting funds to projects.  There are several good places in New Rochelle for retail and development such as Garden Street, Echo Bay and Hartley House.  What is missing is how to bring money to the private sector.  A consultant can be a bridge to the capital markets and Freimuth felt you cannot hire an employee to accomplish this, emphasizing it was not a marketing job. 
     St. Paul spoke about Friemuth's background emphasizing he had "a lot of experience" in past positions such as improving the downtown of Stamford.  Freimuth then mentioned his work in developing an industrial park in Bridgeport, but cautioned, "times are different now."  Now the process will involve working with developers and obtaining finances.  A marketing program will only take the city so far because the market is tough and subsidies may be demanded by developers.   St.Paul suggested spending this $100,000 this year because a success would bring in more than $100,000 to New Rochelle, although he realized it may take more time to get these profits out of a project.
     After the motion to add this expenditure to the budget was made, Council member Marianne Sussman had serious reservations about it and wanted to know if a real estate broker could work on the City's behalf.  The answer by Freimuth was the incentive gets blurred when a commission is involved but a consultant would make a consistent effort and be paid on a monthly basis with the possibility of "out" by the City each month.  Sussman wanted to know if it was project based to generate activity.  The answer by Freimuth was it was project based to bring land use projects to a closing.  A public-private partnership might be used such as with the present Hartley House development for which the City presently needs funding.  St. Paul added the consultant could decide if a developer was unfairly inflating what he promised the project would accomplish. 
     Councilman Barry Fertel asked if someone could be hired "in house," but this was not considered practical.  Freimuth added that right now Echo Bay is proposing changes and a consultant could suggest what the developer needs in order to make a deal.  Councilman Jared Rice said that an issue with Hartley House is how it could effect the neighborhood.  He was told that the consultant would take direction from the City and would not get involved in any project unless the City directed them.  Councilman Lou Trangucci asked about the cost-benefit analysis, especially with proposed retail.   He was told the staff is building skill, referring to the IDA (Industrial Development Corporation) whose recent state audit mandated the city to address this issue of cost and benefits.  PILOTS (payments in lieu of taxes) could be considered if the cost analysis indicates a need.  Bramson then felt the Council was reaching a consensus and asked for a motion to approve this expenditure and it was unanimously accepted.
     The Council then proceeded to the budget vote.  The motion to amend the $223 refuse fee per unit was voted down, 4-3 along party lines with Democrats voting against the motion.  The next motion was to approve the budget with a tax rate of 5.96%.  It was adopted with a 5-2 vote, with Councilmen Trangucci and St. Paul voting against it.  After the meeting, Councilman Lou Trangucci said this budget is going to cost the taxpayers 15% because of the garbage fee which amounts to an 9.1% increase.


3 thoughts on “The Real Tax Increase for New Rochelle Homeowners is 15 Percent”

  1. 15% tax increase accurate

    The refuse fee equates to a 9.1% tax increase, add that to the actual 5.68% increase and you get 14.78% increase so 15% is accurate.

  2. 15% is arrived at by adding the tax increase to the refuse fee

    The refuse fee was over 9% and you can add that to the city's tax increase to get the 15%  Multiple dwellings and two and three family houses will have an even great percent increase.

  3. Where does the 5.96% increase that the city boasts come from?

    I think Lou was shooting from the hip with the 15% comment since he wouldn't have had the time right after the vote to do the calculations. 

    If you do the math and its not very complicated, the increase is a little over 10% (5 times what the governor wanted and yet still within the new tax cap law).   Because the garbage tax is fixed, those with a higher assessments will see a slightly lower percentage increase and those with lower assessment will see a slightly higher percentage increase. 

    Where does the 5.96% increase that the city boasts come from?  As far as I can tell, its really a meaningless number. 

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