By DONALD WITTKOWSKI
Highlighting Ocean City’s strong finances, Mayor Jay Gillian announced in his annual State of the City address Thursday night that there will be no tax increases in the 2022 city budget.
“I am here to signal tonight that the state of the city is stronger than it has ever been,” he said during his speech at a city council meeting.
“We continue to make improvements to every part of the city,” he continued. “We are adding new services and preserving the traditions we love. We have an experienced and dedicated municipal team that makes it all possible. Ocean City remains a great place to live, work and play. Investments in Ocean City are stronger than ever.
Gillian noted that the town continues to benefit from a booming real estate market which is fueling the growth of the local tax base. This year, the city recorded $174.5 million in new fares and now has a total tax base of nearly $12.3 billion, according to budget figures.
Shaking off the sluggish economic effects of the COVID-19 pandemic in 2020, the city’s beach tag sales and parking revenue hit record highs last year amid a heavy summer tourist season, a Gillian said.
Overall, the city’s excess funding soared to a record high of $10.4 million. The city’s strong finances mean there will be no tax increases in the proposed $88.8 million city budget for 2022, the mayor said.
“With everything going on in the world, I think it’s important to get to zero this year,” Gillian said of the lack of tax increases. “We still have to consider how inflation and other global issues might affect Ocean City. But I’d like to put that aside for a moment and send our thoughts and prayers to the people of Ukraine. They deserve our full support.”
Although Gillian touched on aspects of the budget in her State of the City address, CFO Frank Donato will give city council a detailed overview of the spending plan at the March 24 meeting.
Gillian’s budget proposal coincides with her re-election campaign. He is seeking to win his fourth term in the May 10 municipal election, but faces a challenge from Councilman Keith Hartzell. In order to run for mayor, Hartzell will step down from his seat on the general council.
During her remarks, Gillian highlighted a series of infrastructure projects that have been completed or are planned by her administration, including roadwork, flood mitigation, boardwalk improvements, a multi-year dredging program to waterways and the renovation of city buildings.
“I am proud that we have been able to accomplish so much this year, and we have plans in place to maintain the momentum in 2022,” he said, while thanking members of his administration for their “commitment. to all taxpayers”.
Gillian plans to present her 2023-2027 capital plan – a broad master plan for construction projects and infrastructure improvements across the island – before the end of the year.
Approximately $4.9 million in COVID relief funds Ocean City received from the federal government in 2021 will help fund flood mitigation projects and cybersecurity upgrades.
“As always, everything we do is with the taxpayer in mind. Including this budget, we’ve come to zero for three of the last four years,” Gillian said of the city’s stable taxes.
He concluded his remarks by pledging to continue promoting Ocean City’s image as “America’s Best Family Resort.”
“We will ensure that our city is clean, safe and family-friendly,” he said. “We share a common mission to ensure that future generations can enjoy the city we all know and love.”
In other business on Thursday, Council introduced two bond orders to help fund the purchase of three separate plots of land that will now be converted into public open space. The bond ordinances are due for a public hearing and final vote at the March 24 Council meeting.
Overall, the three sites comprise a full block of land bordered by Haven and Simpson Avenues between 16th and 17th Streets adjacent to the Ocean City Community Center. The land will be added to a corridor of open space protected from dense housing construction.
However, the hot real estate market has increased the value of the land since the city began acquiring it. As a result, the city will pay millions more to close the deal.
One of the bond orders is for $3.15 million to help the city buy two sites at 109 16th Street and 1600 Haven Avenue from Palmer Center LLC, a group led by real estate developer and former city councilor John Flood.
Of this money, approximately $1.6 million reflects the higher value of the land and another $1.6 million will go towards environmental cleanup. City attorney Dorothy McCrosson, however, said the city will seek reimbursement of environmental cleanup costs from Palmer Center LLC once the remediation is complete.
With the additional $1.6 million added to the purchase price, the total cost to purchase the Palmer Center property will increase from $5.6 million to $7.2 million, McCrosson said.
The second bond order introduced by the Board provides $3.11 million in funding to complete the purchase of land that once served as the site of the former Perry-Egan car dealership. The property is bordered by 16th Street, Haven Avenue and Simpson Avenue and was owned by brothers Jerry and Harry Klause of Klause Enterprises.
The Klause brothers had wanted to build a 22-unit housing estate on the site before the city stepped in to acquire the land. The city originally planned to buy the Klause property for $6.9 million, but rising land values will drive the price up to $9.96 million, McCrosson said.
With the acquisition of the Palmer Center and Klause properties, the city plans to dedicate a five-block area from 15th Street to 20th Street for open space and public use. The public land corridor will extend from Emil Palmer Park to the Ocean City Community Center and to Ocean City Middle School.