WOOD-RIDGE, NJ - The Wood-Ridge Borough Council has unanimously approved a resolution extending the grace period for payment of property taxes for the second quarter. The grace period for payment of second-quarter property taxes has been extended to June 1, 2020, it was announced at Wednesday’s Borough of Wood-Ridge Council meeting.
This follows Governor Phil Murphy’s Executive Order number 130 which allowed municipalities to adopt such a resolution.
Borough Administrator Chris Eilert, as part of his report to Council outlined the financial considerations that were taken into consideration when determining that the Borough could approve the extension.
“This is a great decision, but it is one that no municipality should take lightly because of the financial ramifications it has on the municipality,“ Eilert stated. “I just remind the public that regardless of a financial crisis, or a health crisis or a natural disaster crisis, government operations still have to continue. “
“To put it into perspective, when you delay the collection of taxes,” Eilert stated. “You are not allowed to do for it for individual taxpayers, or for individual types of properties, or individual valuation of properties, you have to do it across the board, for everyone.”
Eilert then laid out the following facts that were considered when making the decision
Over 80 percent of the tax revenues collected by Wood-Ridge are collected from residential taxpayers, most of which are paid through mortgage escrow
Three mortgage service companies are responsible for over 50% of those escrow payments
Core Logic is responsible for 1265 residential mortgages and over $3 million in taxes
Wells Fargo is responsible for 220 residential mortgages and over $500k in taxes
LERETA Mortgage Services is responsible for 98 mortgages and over $250k in taxes
Over $3.8 million comes in from just those three companies and if those three companies were to delay paying, it would cost Wood-Ridge over 42% of its revenue for the quarter.
The top 20 commercial companies (as commercial taxes make up the rest of the revenues) are responsible for $1.2 million in taxes each quarter.
“Luckily, over 80% of our residential taxpayers have already made their payments,” Eilert stated. “Including those three mortgage services.” Additionally, most of the top 20 commercial real estate tax payers had made their payments.
Eilert stressed that between the 20 commercial and three residential tax services, over $5 million, or 60% of tax revenues could be delayed if they decided to take advantage of the extended grace period.
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