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WPCNR FOR THE RECORD. The State of the City 2008 Address Delivered by Mayor Joseph Delfino. April 7, 2008 UPDATED 2 PM WITH PICTURES: Here for closer review is the Mayor’s address to the Common Council and a citywide television audience Monday evening.
Mayor Joseph Delfino Delivering the Development Story at the Common Council Monday evening.
2008 State of the City
First on the agenda is the annual State of the City Address.
I’m very pleased to report that due to effective planning, efficient management and the collective efforts of my administration and the Common Council, the State of our City — in every respect – is sound and extremely strong.
Ten years ago, my administration put together a desperately-needed plan for the revitalization of White Plains. Based on the principals of smart growth development, that plan has served as a blueprint for the benefits and successes we are now beginning to realize.
By protecting the outlying neighborhoods and concentrating development in the downtown, and by working very closely with representatives of our City’s close-in neighborhoods, White Plains is now a vital and vibrant urban center while still maintaining the charming suburban quality of our residential areas.
I want to thank our neighborhood organizations for their input and cooperation in working to keep White Plains moving forward. Their dialogue has been a major ingredient in the success of our revitalization.
White Plains is now in a fortified and solid financial condition. Our City is now rated Aa1 by Moody’s Investors Service, the second-highest rating given by the investment community.
White Plains is the only City in the State to enjoy such a rating.
The financial benefits of our new growth have been extraordinary. In the downtown, once-vacant lots and abandoned buildings that previously generated less than $2 million in property taxes now generate close to $13 million in revenues, an increase of more than 650%.
White Plains has become the most desirable location in the region for major corporations and businesses. This, from a city that in 1998, had an office vacancy rate of 34% — the highest in the nation! Today, the rate has plummeted to less than 7%. Vacant offices have been filled, raising the property values of these commercial buildings. In fact, since 1998, the City’s full property value has increased an astounding 157%. (Editor’s Note: it was reported that the White Plains office vacancy rate has risen to 12.7% as of last week.)
Tonight, I can also report that for the first time in more than a half decade, White Plains assessment roles have increased, despite the fact that the majority of our new development – more than $19 million dollars – remains off our assessment roles because the City has still not been granted its own IDA.
I am convinced that millions of dollars in administrative fees that could have been used to offset property taxes for residents in the City of White Plains have gone to subsidize County government instead. This is simply not acceptable.
I will continue to strongly advocate to higher levels of government that White Plains be granted its own IDA, just like Yonkers, New Rochelle, Mt. Vernon and every major community in Westchester.
Much of our new development has contributed to the diversity of our retail base, and that has had an enormous impact on our sales tax revenues which have reached a record high of $45 million.
In fact, the most startling statistic regarding sales tax revenues is the fact they have increased by more than 67% since fiscal year 1997-98, when I first took office as Mayor.
A report just released on the economy in Westchester by State Comptroller Thomas P. DiNapoli noted that while the County’s population growth of 2.5% through the years 2000 to 2006 outpaced the rest of the State, White Plains’ growth was a full 7% during the same period.
So here in our great City of White Plains, we are at the vortex of incredible, positive change in every facet of our life as a community.
Always, my primary concern has been, is, and will continue to be, you, the residents of our City. I have fought to keep your City taxes as low as possible. White Plains is a unique City. Having maintained the suburban nature of many of our residential neighborhoods, we have always stood out as the County Seat and a major retail and business center.
We have worked hard and tirelessly to ensure that all our new development benefits the residential property taxpayer. An enormous statistic: White Plains property taxpayers’ contribution to our general fund budget accounts for only 28.6 percent of the revenues of our budget – the lowest property tax contribution to any budget in the State of New York.
Tonight, I want to address, specifically, a question that I know is on nearly every resident’s mind. What are the benefits of our new development and how does it affect your taxes?
Let me begin by explaining that we collect nearly $13 million in new property tax revenues generated by new development. Of that $13 million, $8.3 million goes to the school system and the remaining $4.7 million is split, nearly 50 – 50 between the County and the City with a little more than $2 million going to each.
And yet it is the City that provides all the services to you, our residents. It is the City that provides you with police and fire protection. It is the City that picks up your garbage, plows your streets, and removes your leaves.
I must ask: What is the County doing with their share of this new revenue for you, our residents?
Let anyone who believes new development has harmed our City, consider this fact: At $20,000 – considered to be the cost of education for a student for one year – new development in the City is paying for the education of more than 400 students per year! Data from the school district shows that the new development has only generated approximately 30 additional students.
Our City’s new development, itself, has generated substantial revenues in property taxes. But there are additional, financial spin-offs of our new development which dramatically add to our revenues. These additional sources of revenue offset costs without it then we’d be forced to raise property taxes in order to maintain the same level of services that you, our residents have become accustomed to. For instance:
Building permits and fees – fueled largely by new development – generated more than $7 million in the last two years alone. In 1998, building department fees didn’t even reach $1 million. Without this essential source of revenue, property taxes over the last two years would have been increased by an additional 5%.
Then there’s our mortgage recording tax. In 1998, it was just over $1 million. In 2007, our economic growth propelled this revenue source to over $5.6 million. Without this revenue growth, over the past 10 years, property taxes would be as much as 9.5% higher than they are today.
Our new development has also brought in direct user fees, such as parking. This past year, parking revenues generated over $19 million – an increase of $3.3 million from the previous year. Without this additional revenue, we would have been forced to raise property taxes by another 8%. Keep in mind that more than 65% of parking revenue is derived from non-resident use.
It’s clear, when you look at these numbers, that our Smart Growth development program has meant a tremendous savings to property owners.
The sales tax has always been a revenue stream that has traditionally helped off-set the tax burden on our residents. In fact, sales tax revenues – even without the quarter percent increase – have surpassed property taxes as the number one source of revenue for our City.
Think about that for a moment. We’d have to raise taxes by more than 40%, over the last 10 years, to generate the same revenues from our current sales taxes.
Studies based on IRS statistics bear out the fact that 90% of our sales tax revenue is generated by non-residents.
Last year, I proposed raising our sales tax rate by one-half percent to equal that of the other major cities in Westchester. In the spirit of compromise with our Assemblyman Adam Bradley – I settled on a quarter percent increase instead and I applaud Assemblyman Bradley for his diligence in getting the increase approved by the Assembly and I our the State Senate to pass this quickly as possible.
Assemblyman Bradley has also promised to review the City’s finances with me on an annual basis and I believe the budget we’re releasing tonight makes it clear that there is a demonstrated need for the other one quarter percent.
Had we received the full one-half percent I originally advocated for, it would have prevented any property tax increase and would have provided a small surplus that would grow year after year. The shifting of tax burdens from the shoulders of our residents should be foremost in the minds of all your elected officials.
With that full one-half percent the White Plains sales tax
would be equal to, and not a penny more than, any of the
other major cities in the County, all of which, by the way, have their own IDA’s to generate additional revenues.
Think of how much property taxes would have to be increased if we did not have these other sources of revenue from new development. We should keep this in mind as we continue our Smart Growth Development Program while carefully considering new development in the downtown.
Now, let’s shift our perspective for a moment. Earlier, I spoke about our uniqueness as a City – a dual City that combines what’s best of urban life with what’s most celebrated as suburbia.
It is most important for me to point out that it is the failure or refusal of other levels of government to recognize our uniqueness that is forcing our residents to pay an enormous price.
Because State government refuses to recognize our uniqueness as a major commercial AND residential community we are forced to comply with a bizarre and inequitable formula that costs you, the taxpayer millions of dollars.
Equalization Rate
The State attempts to balance the values of commercial and residential properties together with what is called an equalization rate. I’m not going to get into the convoluted rational to try to explain how this formula works tonight. Anyone who wants to learn about this can access the City website and read an excellent explanation of it by our Assessor called “Everything You Ever Wanted to Know About Assessments.”
What I will say is that in communities where there is a fraction of the commercial properties that we have in White Plains, this formula might work. It does not work, however when you consider that more than half, or approximately 59%, of White Plains properties are commercial. With the current equalization formula, the State punishes White Plains for being successful.
We were forced to refund more than $4 million to commercial property owners in the last two fiscal years alone. This is equal to an 11% tax increase.
Does it make sense to anyone that we are forced to refund millions of dollars to corporations and businesses in a city where full values of properties have risen 157% and where vacancy rates have dropped by nearly 30%?
The residential property taxpayer not only gets hurt by the fact that the City is forced to refund $4 million to commercial property taxpayers, but also because the assessed values of these commercial properties are then reduced as well.
I stated earlier that the City assessment role grew for the first time in five years, and that’s clearly a remarkable achievement, considering that last year alone, we were forced to reduce our assessment role by more than $6.9 million due to commercial tax certiories caused by the State Equalization Rate.
Tonight, I am releasing the City’s Budget for 2008-2009. I am pleased to announce that there are no projected cuts in services to our City residents. Spending this year is being held to a mere 3%, the majority of which is contracted salaries and benefits.
Yet, despite that and the astonishing financial benefits of our economic redevelopment, there still remains a gap between revenues and expenditures. This gap, largely brought about, unfairly, by the uniqueness of this great City, necessitates a 4.9% property tax increase over last year.
Despite the penalties of the State Property tax system, our redevelopment efforts have helped to off-set most of the negative impacts and fueled a number of quality of life initiatives that significantly benefit all our City residents. Some initiatives began years ago, others in the past year. They include:
– The creation and approval of 320 affordable residential units
Our affordable housing program is one of the most aggressive in the region. White Plains was recognized by HUD as a national model program and this year we increased our required percentage of affordable units on new developments from 6% to 10% My administration will continue to work innovatively for any opportunity to create even more affordable and workforce housing.
Our Computer Technology Centers at the Slater Center and the Youth Bureau where residents can learn computer technology and access the Internet have been enormously successful.
Throughout our downtown and in many neighborhoods we have worked to improve our public spaces. Our fountain plaza stands out as a model of what can be done through public/private partnerships. In addition,
Our Streetscape Improvement Program has been a huge success. I want to thank Senators Clinton and Schumer for their contribution of $1.5 million that enabled us to expand our downtown streetscape improvements to Lexington Avenue and Post Road.
The White Plains Performing Arts Center, the result of another successful public/private partnership and now in its fifth year, has undergone a major transformation to become the County’s only professional regional theater. This year, the Performing Arts Center has successfully financed and produced three top quality Broadway level musicals, with its fourth and the season’s final show “How to Succeed in Business Without Really Trying” opening April 24th.
The Performing Arts Center, one of the brightest gems in the downtown district, highlights and celebrates the diversity that is White Plains by partnering with the City of White Plains, White Plains School District, the Juneteenth Committee, Shinnyo En, and other community organizations to bring the performing arts to all our residents. (Editor’s Note: the city will furnish about $400,000 to the White Plains Performing Arts Center in monies and services in the 2008-2009 budget.)
When you consider our vast redevelopment activity, it is no small achievement that we have acquired or dedicated more than 53 acres to be preserved as open space. We have procured all five parcels identified by the original Open Space Acquisition Committee which I formed in 2001, and I have recently convened a new committee to identify more parcels for potential acquisition.
White Plains has always been at the forefront of the Green Technology frontier. Whether it be through the City’s use of hybrid vehicles, the green building technology requirements we impose on new development or the opening last year of one of only three Hydrogen refueling stations in the State, our City’s commitment to the environment has remained steadfast.
To carry this commitment even further, I recently convened a new Green Technology Committee comprised of business and construction representatives, energy officials and City staff to discuss ways to further our commitment to preserving the environment.
More than a think tank, the Green Technology Committee is results-oriented and committed to having a measurable impact on our community and its growth in the near future as well as long-term.
Recently my office began a new Neighborhood Association outreach program. Regular meetings are now being scheduled with my office, City staff and neighborhood association representatives so that improvements and suggestions can be coordinated and implemented.
A handbook for residents of each separate close-in neighborhood is currently being produced and I look forward to a number of new initiatives to come from these meetings in the coming year.
Recently a new form has been added to the City’s website for residents to use for inquiries, problems, questions or issues of concern. It’s on the front page listed as Questions or Comments.
For some time now, it has been apparent that major changes are required in the regulation of the City’s taxi services. I have recently formed a committee comprised of City residents, representatives from the Business Improvement District, my office, Public Safety and industry officials to look at ways to improve service and increase oversight of this vital industry.
I am renewing, once again, my administration’s commitment to continue revitalization efforts in the downtown, particularly along the Lexington Avenue and Post Road corridor. Although this process has been lengthy, I believe the results will be stellar. There is a core group of residents and businesses who have a strong interest in seeing this area redeveloped and we will continue to work closely with them in the coming year.
In our first venture in this area, our public private partnership with White Plains Hospital and the Kensington Assisted Living Facility to construct a new garage is well underway with the structure scheduled to be open in November in time for the holiday shopping season.
Trolleys
I’m also happy to announce that through the enormous and tireless efforts of many, including Melissa Lopez of my office, we have obtained funding commitments from the federal government and from the New York Power Authority to purchase two green technology trolleys to be deployed within the City – hopefully as early as this coming year.
I’m not happy to announce that a flood caused by a leaking pipe recently shut down City Hall for a day bringing to the forefront a challenge we’ve all known about for some time. The flood destroyed some of our most important technological equipment and caused more than $500,000 in damages.
City Hall
The cost to the taxpayers and the inconvenience of shutting down City Hall for a day is completely unacceptable. Ten years ago we began looking at the renovation and expansion of City Hall and decided to wait. I am asking my staff to once again begin the process of accessing what is needed and how best to accomplish it.
Although City Hall sits on one of the most valuable properties in downtown, I believe it is the most appropriate location for it. I am asking my staff to think creatively, and to look at every creative possibility including public – private partnerships or public – public partnerships that might produce the renovation and expansion we sorely need at little to no cost to the taxpayers.
As always, there is much more to be done to manage our City effectively and well. I want to first thank my family for allowing me to make the commitment to work 24/7 as your Mayor – it is a privilege and an honor to do so. But it requires great sacrifice, and I thank my family for their continued understanding and support.
I also want to thank all of our City staff who goes above and beyond the call of duty – on a daily basis – to make this City a leader in everything it does. I am particularly proud of the compassion and caring my administration has for those less fortunate and those in need of special consideration.
When I see the outreach and goodwill, the conscientiousness, professionalism and expertise of my staff at City Hall, it truly makes me very proud.
I have tremendous gratitude for our men and women who serve on the City’s police and fire departments and who have done a truly outstanding job putting major crime at its lowest point since the 1960s. With all our growth, this is truly remarkable. I want to give them a special thanks.
And, of course, I want to thank this council for all their hard work. There is no question about their commitment to making White Plains the greatest City it can possibly be.
Looking ahead, I’m eager to deepen my partnership with this Council to sustain and maintain the level of growth that has kept White Plains at the forefront of the State and region and that has benefitted our more than 57,000 residents who depend on our leadership to provide the very best of services at reasonable costs.
I look forward to working with our Albany representatives once again to get the recognition of the State government regarding the uniqueness of the City’s tax base and allow a more equitable formula to be applied to reduce the burden on our City’s finances and to stop punishing our residential property taxpayers in favor of our commercial ones.
A solution does exist. The State already recognizes the fact that New York City has a uniquely split commercial and residential property base and it allows that City to tax each entity separately – commercial and residential. White Plains should be allowed to do the same.
In a City where nearly 60% of its properties are commercial, and where retail and office uses are so prevalent, sources of revenue – other than property taxes – must be vigorously pursued. We will continue to work hard and creatively to ensure that residents are not subsidizing those who visit here to shop, work or enjoy entertainment.
I pledge to continue my advocacy on the County level and on the State level for what I believe to be clearly in the best interests of our residents.
Thank You and May God Bless America.
