Monetization, Middletown style
by The Courier, May 8
Posted:05/13/08

Given the mess that New Jersey’s state finances are in, one would think that a well run town like Middletown would know better than to use one-shot gimmicks to plug budget holes.

The Asbury Park Press reported on May 6 that the Middletown Township Committee is considering Trenton-style gimmickry to plug a budget gap caused by Trenton.

According to The Press, Middletown is considering selling off 50 percent of future cell tower revenue for an upfront payment of $890,000. This one shot deal would partially offset state mandated expenditures: a $1.1 million increase in pension contributions, a mandated $315,000 increase to public library funding and $750,000 in severance for six police officers who retired in 2007. Additionally, Middletown would lose $635,000 in state aid under Corzine's proposed budget.  That lost aid, and all of your state income tax, will go instead to the black hole of urban cities and school districts where the politicians live high on the hog.

With political control at stake in Middletown in this year's election for the first time in decades, it is understandable that the Republican-dominated committee would want to lessen the blow of property tax increases. But, this one-shot deal is bad fiscal policy and bad politics. There will be an increase even with the gimmick. The voting public will be upset weather they received a $.07 increase or a $.10 increase.  

By taking a one-shot boost of funds by selling the cell phone revenue, the township committee is also paying commissions, legal fees and a return on the investment for the purchaser of the stream of payments.  The return on investment will very likely be greater than what the township would pay in interest if it were to borrow the money.  By taking the discounted money now, the township is postponing the problem, a greater tax increases, to future years.  That is how our state government got in the mess that is causing so much trouble now.

Middletown, and every other town facing increases should place the political blame for property tax increases due to state mandates and aid cuts exactly where it belongs — on Trenton Democrats. Don't give the Trenton Democrats cover by using one-shot gimmicks. They have been doing that themselves for years.

The members of the Middletown Township Committee are smart people.  They have to know that this one-shot gimmick is a bad deal for the taxpayers, long term. Middletown didn’t become the well-run municipality it by playing Trenton-style games.  They shouldn’t start now, regardless of whatever political fears they may have.  Act with political courage, gentlemen and lady. Then blame the whole mess on Trenton where it belongs.

I don't vote in Middletown, but I do pay property taxes there. I'd rather have the cell phone revenues available to lessen the pain over time than to overdose on them this year and have worse pain in future years.
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