http://njeducationaid.blogspot.com/2016/10/2016-equalized-valuations-out.html
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It's common knowledge that New Jersey's cities have had divergent fates in the last two decades. In this post I hope to quantify those divergent fates using changes in Equalized Valuation, both in absolute dollars and in each city's percentage of New Jersey's statewide Equalized Valuation.
Equalized Valuation is essentially the market value of all taxable real estate in a town. It is determined annually by the county tax assessor and is based on real estate sales.
Equalized Valuation is used to determine a town's share of county taxation and, for a town in a regional school district, that town's share of the school district's tax levy. Equalized Valuation is supposed to be used to determine how much Equalization Aid a school district gets but this provision of New Jersey's school aid law is not followed.
The source of this information is the Table of Equalized Values. (It has been updated for FY 2016.)
I have put the data online.
Here goes:
Absolute Dollars
As a Percentage of Total State Equalized Valuation
Based on property wealth relative to the rest of the state, Camden, Trenton, Newark, Elizabeth, and Paterson have continued to struggle. Trenton dropped from having 0.38% of Equalized Valuation to only having .19%. Camden dropped from 0.14%. Camden was extremely low to begin with and didn't have far to fall, but it dropped from 0.18% to 0.14%. Newark had a bad 2015 and lost over $200 million and is now tied with Hoboken for the fourth highest Equalized Valuation in New Jersey, Paterson and Elizabeth also continue to lose valuation in absolute and relative terms.
I don't mean to disregard any progress made or differences between those cities, but over the last two decades these cities have lost ground relative to other big cities in New Jersey and the state as a whole.
Hudson County has really triumphed, especially in the "recovery" from the recession.
Jersey City had 1.05% of EV in 1998, now it has 1.83%, or $21.6 billion. If you factored in its $8 billion in "hidden" PILOTed property it would possess about $28-29 billion in Equalized Valuation, over 2.0% of New Jersey's total.
Jersey City and Newark were never really peers. Their Equalized Valuations were approximately equal in 1998 but Jersey City's had 30,000 fewer residents.
Hoboken, the "Mile Square City," has 1.12% of New Jersey's Equalized Valuation. From 2013 to 2016 its Equalized Valuation rose from $9.6 billion to $13.3 billion, a $3.7 billion gain in only three years. This gain alone is equal to all of Trenton's Equalized Valuation.
Hoboken now has New Jersey's fourth highest Equalized Valuation, after Jersey City, Toms River, and Edison. Newark and Hoboken's Equalized Valuations are uncannily within $1 million of each other.
Atlantic City, at the opposite extreme, has collapsed. In 2008 its Equalized Valuation was $22.2 billion. Now it is only $8.4 billion. Atlantic City's mayor predicts its valuation will stabilize at $7 billion but no one really knows.
Despite their increases in wealth, neither Jersey City nor Hoboken has lost education aid, although Hoboken's K-12 aid has been basically flat since 1996 and Jersey City's K-12 aid has been flat since 2006. Counting Pre-K, the percentage of state aid going to both cities has actually increased in the last few years.
Absolute Dollars
As a Percentage of Total State Equalized Valuation
Based on property wealth relative to the rest of the state, Camden, Trenton, Newark, Elizabeth, and Paterson have continued to struggle. Trenton dropped from having 0.38% of Equalized Valuation to only having .19%. Camden dropped from 0.14%. Camden was extremely low to begin with and didn't have far to fall, but it dropped from 0.18% to 0.14%. Newark had a bad 2015 and lost over $200 million and is now tied with Hoboken for the fourth highest Equalized Valuation in New Jersey, Paterson and Elizabeth also continue to lose valuation in absolute and relative terms.
I don't mean to disregard any progress made or differences between those cities, but over the last two decades these cities have lost ground relative to other big cities in New Jersey and the state as a whole.
Hudson County has really triumphed, especially in the "recovery" from the recession.
Jersey City had 1.05% of EV in 1998, now it has 1.83%, or $21.6 billion. If you factored in its $8 billion in "hidden" PILOTed property it would possess about $28-29 billion in Equalized Valuation, over 2.0% of New Jersey's total.
Jersey City and Newark were never really peers. Their Equalized Valuations were approximately equal in 1998 but Jersey City's had 30,000 fewer residents.
Hoboken, the "Mile Square City," has 1.12% of New Jersey's Equalized Valuation. From 2013 to 2016 its Equalized Valuation rose from $9.6 billion to $13.3 billion, a $3.7 billion gain in only three years. This gain alone is equal to all of Trenton's Equalized Valuation.
Hoboken now has New Jersey's fourth highest Equalized Valuation, after Jersey City, Toms River, and Edison. Newark and Hoboken's Equalized Valuations are uncannily within $1 million of each other.
Atlantic City, at the opposite extreme, has collapsed. In 2008 its Equalized Valuation was $22.2 billion. Now it is only $8.4 billion. Atlantic City's mayor predicts its valuation will stabilize at $7 billion but no one really knows.
Despite their increases in wealth, neither Jersey City nor Hoboken has lost education aid, although Hoboken's K-12 aid has been basically flat since 1996 and Jersey City's K-12 aid has been flat since 2006. Counting Pre-K, the percentage of state aid going to both cities has actually increased in the last few years.
Conclusion:
The fact that wealth changes is obvious to absolutely everyone in New Jersey except for Chris Christie, the legislature, and the education Establishment like the Education Law Center and New Jersey School Boards Association, all of whom have recently opposed redistribution of state aid away from any district, no matter how overaided and lightly-taxed.
The frozen distribution of state aid is not sustainable. There are forty districts in New Jersey that have aid deficits of at least $4,000 a student and 40,000 poor children in New Jersey who have no access to Pre-K.
The Pension Crisis makes it impossible to increase education funding and endangers the existing $8.6 billion aid stream.
At some point I pray that it penetrates the Establishment that redistribution is necessary.
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See for an update for tax year 2017.
http://njeducationaid.blogspot.com/2016/10/2016-equalized-valuations-out.html
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