ATLANTIC CITY — Three days after a news conference where he apologized to business owners and residents for not doing more to prevent the prior evening’s riots, Mayor Marty Small Sr. announced a more than 5% decrease in municipal taxes.
“This is the biggest gift that I can give the taxpayers of Atlantic City,” Small said Thursday. “This is the best news for Atlantic City considering all the controversy swirling in our great city the last few days,” a reference to Sunday night’s vandalism and property damage following a peaceful protest against police brutality.
City officials said an increase of $20 million, to $152 million, for this year’s payment in lieu of taxes from casinos is one factor. Another factor is a better-than-expected year in raising local revenue. Combined, the two revenue streams will allow the city to keep spending stable while offering taxpayers a rate nearly 10 cents lower than last year’s $1.80 municipal tax rate.
The proposed rate would mean that for every $100,000 in assessed property value, the municipal portion of a taxpayer’s bill would equal $1,702.72.
The actual proposed operating budget for the city is increasing slightly, according to the figures presented Thursday. The proposed budget is $208.1 million for 2020, while last year’s adopted budget was $207.7 million.
If adopted, the 2020 budget would represent the second municipal tax decrease in the past five years, the other being in 2017. In 2016, 2018 and 2019, the city adopted budgets that kept the tax rate at the same level as the previous year. A copy of the budget was unavailable at the news conference. The budget is expected to be part of this month’s council meeting agenda packet.
Small said the city administration is projecting municipal tax decreases for the next three years.
Atlantic City remains under state fiscal oversight following the Municipal Recovery and Stabilization Act of 2016, and the budget must be approved by the state Department of Community Affairs.
“Over the course of several months, DCA has worked closely with the city’s professional staff in putting together the proposed budget, which would mark the fourth consecutive year of no municipal tax increase for city property owners,” DCA spokeswoman Lisa Ryan said in a statement. “We believe it is a prudent financial plan, and we are pleased it includes a proposed decrease in the municipal property tax rate at a time when so many property owners in the city are being economically squeezed by the COVID-19 pandemic. We remain confident that the city is fiscally on the right path even during this turbulent time.”
Council President George Tibbitt said the administration’s budget will be introduced at the next public meeting.
“You see what happens when you have a mayor and his administration, the state and a council that work hard together,” Tibbitt said Thursday. “This is great news for the City of Atlantic City. It’s something that the citizens, the taxpayers, the whole load of small businesses really deserve.”
The positive announcement of a tax decrease was accompanied by the sobering reality of the city’s long-term financial picture: Atlantic City remains one of the state’s most indebted municipalities, with an outstanding obligation of roughly $566 million. Small said if the city did nothing else other than make required debt payments, the total would not be paid off until 2043.
“We didn’t get this debt overnight, and it’s not going away overnight, so please be patient with this,” the mayor said.
Atlantic City relies heavily on state aid to support its annual budget, and Small said the administration is confident that, despite New Jersey’s own revenue-generating issues as a result of the novel coronavirus’ impact on the economy, the money would be forthcoming. In 2019, Atlantic City received $62 million in aid from New Jersey.
“We’re well aware of what’s going on, we know what pitfalls are out there,” Small said. “(State leadership) knows how important the City of Atlantic City is, and I’m sure that there will be no hiccups in the form of state aid.”