the infamous RAD: read and be the judge…
Thursday, December 9th, 2010(stay tuned for info about our January meeting) meanwhile…the RAD is bad, read on…
Open Letter to Millville City Residents:
Revenue Allocation District Analysis (Millville’s RAD)
On September 19, 2006 the City Commissioners adopted the preliminary Revenue Allocation District Plan. The RAD was born. The Commissioners at the same time were regaling the taxpayers with the prospect of stabilized, or lower local real estate taxes because of the taxes to be paid by the Union Lake Crossing Shopping Center and Target. Economic prospects were bright because of the Arts District, the Levoy and the thousands of jobs to be created by the NJMP. The costs of the Commissioners’ “vision” (close to $l00 million and 20 years in the making) were characterized as irrelevant because most of it was UEZ money, State and Federal grants. At the very same time the rosy prospect of enhanced revenue from rampant development was being touted, the Commissioners were advancing a plan to siphon off half of the new taxes from 17% of the City’s ratable base. The RAD, like tax abatements and PILOTS, affects not only Millville taxpayers, but all County taxpayers. The siphoned off half stays in the zone and like tax abatements and PILOTS, the RAD shortchanges the County and the schools. Why the County Freeholders and School District agreed to the scheme is a mystery. The creation of the RAD introduced the 6th “special zone” in the City. Special zones are discrimination by the government, arbitrary, favor some property owners, disadvantage others and put “non-zone” business and industry at a competitive disadvantage. Bond counsel for the City publicly acknowledged that the RAD was unnecessary. Yet the City spent hundreds of thousands of dollars on consultants and lawyers to get the State to approve the RAD.
The first action of the new RAD was to borrow $8,130,000 ($11 million with interest) ostensibly to improve the infrastructure in the third ward. The RAD gave Union Lake Shopping Center $1.5 million, and Target $1 million. It spent $374,000 on the pedestrian bridge in Waltman Park and gave $375,000 to the Levoy Theatre. Landlords and homeowners in the RAD district received $2,770,000 for repairs and improvements to their properties which included remodeled kitchens, windows, siding, etc. The RAD spent $470,000 for “administration” and also gave $200,000 to the private developer of the South Second Street Senior mid-rise.
To pay for this giveaway program, local real estate taxes are diverted to the RAD utililty depriving the general fund of that money. That procedure negatively impacts both the County and the schools. The tax anticipated for 2008, 2009 and 2010 was $750,000. The actual tax collected was $520,000 raising questions about the ability of the RAD to pay its expenses. If it cannot, the City must make up the shortfall.
The RAD has not benefitted the City. It has benefitted a few landlords and homeowners at everyone else’s expense. It has not adhered to, nor fulfilled its stated purpose. It has increased the burden on the County’s taxpayers without benefit to the general welfare. It should be abolished now.
Diane Reinhardt