Tuesday, May 25, 2010

“Daley: No property tax hike in next year's budget” plus 3 more

“Daley: No property tax hike in next year's budget” plus 3 more

Daley: No property tax hike in next year's budget

Posted: 25 May 2010 01:02 PM PDT

Mayor Richard Daley says he will not propose a property tax increase as part of next year's city budget.

But Daley said unspecified fee increases and service cuts remain on the table to balance the budget, describing those steps as "a last resort." Service cuts could be permanent or last "a year or two," Daley said.

"We're living in austere financial times in America," Daley said during a speech to the City Club of Chicago.

Daley also said new city beautification efforts will be put on hold, saving $4 million. Existing planters and trees will be maintained, but new ones will not be installed, he said.

Read more on Clout Street.

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N.J. Gov. Chris Christie defends cuts, promotes property tax cap in Rutherford

Posted: 25 May 2010 10:57 AM PDT

RUTHERFORD — Governor Christie on Tuesday told a borough teacher to find another job if she did not feel she was compensated enough as he defended his state budget cuts and promoted a plan to cap annual growth in property tax collections.

He also told an 89-year-old former mayor she'd have to wait until next spring for a rebate she'd been getting for more than a decade in the late summer. And he told a parent that cuts to services, including the local library, are needed because "we are out of money."

A largely friendly crowd of about 150 people turned out in a church gymnasium to hear Christie deliver a half-hour talk that trashed greedy public employee unions and state laws that handcuff local officials trying to control spending.

He then opened the floor to questions. A few were softballs, including the declaration by Clara Nebot of Bergenfield that Christie is "a god" to her relatives in Florida.

But borough teacher Rita Wilson, a Kearny resident, argued that if she were paid $3 an hour for the 30 children in her class, she'd be earning $83,000, and she makes nothing near that.

"You're getting more than that if you include the cost of your benefits," Christie interrupted.

When Wilson, who has a master's degree, said she was not being compensated for her education and experience, Christie said:

"Well, you know then that you don't have to do it." Some in the audience applauded.

Christie said he would not have had to impose cuts to education if the teachers union had agreed to his call for a one-year salary freeze and a 1.5 percent increase in employee benefit contributions.

"Your union said that is the greatest assault on public education in the history of the state," Christie said. "That's why the union has no credibility, stupid statements like that."

Surrounded by reporters after she spoke, Wilson said she was shaking from the encounter, and worried she might get in trouble for speaking out.

Christie has outlined a "toolkit" to address New Jersey's property taxes, which on average are among the highest in the country. The centerpiece is a proposed constitutional amendment that would impose a 2.5 percent cap on the annual increase in the local property tax levy, which is the total amount of taxes collected each year from towns, school boards and county government.

"What it's going to do is impose discipline on every level of government," Christie said, adding that 30 years of previous efforts by Trenton to control property taxes failed.

Christine Beidel said she was worried that Christie was trying to control local communities' ability to raise money at the same time cuts in state aid to the borough could force the local library to close.

"You're cutting and cutting and cutting and there's no way to make up the difference," she said.

Christie told her that unlike the federal government, the state cannot print money. He said that under his proposal, a community could exceed the 2.5 percent cap if the increase is approved in a local referendum.

Margaret Schak, who was mayor of Ridgefield in 1976, asked about the state program that "freezes" the amount that senior citizens who meet income requirements have to pay in property taxes. The program, created in 1997, provides a rebate to offset any increase a homeowner pays.

Christie said he wasn't cutting the program, but he was temporarily preventing newly eligible seniors from enrolling. He also said he was going to change the program from a rebate paid in the late summer or fall to a tax credit put on the tax bill the following spring.

That means Schak, who said her rebate was about $2,400 last year, will not get a check this year and instead will have to wait until 2011 for the credit to lower her tax bill.

The meeting at the parish gymnasium of First Presbyterian Church on Ridge Road is the third Christie has held to tout his property tax plan. He urged the audience to contact their state legislators to support the package.

"It is time. It is time for us to take the next march in the battle of change," Christie said. "It's not about Republicans and not about Democrats, it's about New Jerseyans and who's going to be left in the state if we don't do this."

E-mail: jackson@northjersey.com

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In China, Property Tax Or No Property Tax?

Posted: 24 May 2010 02:05 PM PDT

Shanghai stocks, led by real estate developers, jumped 3%+ Monday, in part on the "news" that one government official had said there would no introduction of a property tax for three years, and another one had said that there are no near-term plans for even harsher real estate rules. Investors and developers have been very worried about a looming property tax and the threat of more regulations, so it is huge news if these statements are true and reflect official policy.

The China Times reported that on Sunday Huang Hanquan, assistant director of the industrial institute of the National Development and Reform Commission (NDRC), the nation's top economic policymaking agency (and former State Planning Commission), said "Taxes on holding of residential properties is impossible at least for another three years." The paper also reported that Kong Jingyuan, director of the Department of Economic System Reform at the NDRC said that China "will not unveil tougher new rules aimed at further reining in China's property market in the near future."

Huang denied he made this statement in a call with Bloomberg News Monday morning. Did the China Times make up this quote out of whole cloth, or were Huang and Kong speaking out of turn?

A report this afternoon from Xinhua, quoting the NDRC, supports the idea that Huang did make this statement and now everyone is trying to backtrack. So far the article--发改委:三年内免谈房产税说法不代表官方立场 (NDRC: ""No Property Tax For Three Years" Does Not Represent An Official Position")--is only in Chinese. The NRDC statement says that Huang is a researcher, what he said represents his personal views only and that the story is seriously in error and had very negative consequences.  The NDRC statement also says that Kong Jingyuan neither made external statements about real estate nor accepted any media interviews. It does not say he did not say it.

Has China been so spooked by the Eurozone crisis that it has refilled the bubbly punch bowl? Keep reading at Sinocism→

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Shanghai to Start Property Tax Trial, Observer Says (Update1)

Posted: 25 May 2010 12:39 AM PDT

By Bloomberg News

May 25 (Bloomberg) -- Shanghai, China's richest city, will introduce a property tax policy on a trial basis next month, the Economic Observer reported, citing an unindentified person.

The report didn't identify the nature of the tax and said more detailed policies may be announced at a later date. The 21st Century Business Herald reported on May 14 the prospect of expanding a tax on commercial-use properties to residences.

"This should be the expanding of existing tax for commercial-use properties to residential real estate," said Zhao Duo, a real estate analyst at Sealand Securities Co. in Shenzhen. "It may not need approval from the State Council for the tax because it's a local tax. There's speculation that Shanghai will tax only new purchases of large homes so the impact would be mild."

China's property stocks fell the most in more than a week today on concern the government is stepping up measures to clamp down on property speculation to tame asset bubbles. It has raised banks' reserve requirements three times this year and restricted pre-sales by developers, curbed loans for third-home purchases, raised minimum mortgage rates and tightened down- payment requirements for second-home purchases.

Prices for new homes in Shanghai dropped 16 percent in the week ended May 23 to below 20,000 yuan per square meter from the previous week, property consultant Shanghai UWin Real Estate Information Services Co. said in an e-mailed statement yesterday.

New home prices last week fell to 19,204 yuan per square meter, while transactions for new homes rebounded 27 percent from the previous week's five-year low, it said. China's real estate prices rose a record 12.8 percent in April from a year earlier, the National Bureau of Statistics said on May 11.

Tightening Caution

China should be cautious in introducing new tightening measures because the global economic environment is complex, Xu Lianzhong, an official with the National Development and Reform Commission's price-monitoring center, wrote in a commentary yesterday in the China Securities Journal. The government is trying to peel back the effects of a stimulus plan and $1.4 trillion lending binge that revived economic growth while raising the risk of asset bubbles.

Shanghai's municipal government may levy an annual tax of about 1.5 percent of the value of properties, the Hunan province-based Xiaoxiang Morning Herald newspaper reported May 13 on its website, citing a developer who declined to be identified. Sealand's Zhao said today there was market speculation the tax might be around 0.8 percent.

Clear Policies

"As soon as the government policy is clear, whatever it is, the market will come back," Zhang Xin, chief executive officer of Soho China Ltd., the biggest developer in Beijing's central business district, said in a Bloomberg Television interview today. "What the market doesn't like is there might be something more coming next week, then let's just wait and that waiting doesn't help."

Poly Real Estate Group Co., the second-largest listed developer, lost 4 percent to 11.66 yuan in Shanghai. China Vanke Co., the biggest, dropped 3.9 percent to 7.40 yuan. The Se Shang Property Index lost 2.5 percent.

To contact the reporter on this story: Jian Guo Jiang in Shanghai at jjiang@bloomberg.net

Last Updated: May 25, 2010 03:29 EDT

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