We often read or hear talk about the economic benefit the summer rental economy confers on Belmar. Most often, we’ve heard it expressed in the context of how Belmar would fold up if summer tenants stopped renting here. This perception has likely contributed over the years to the belief on the part of many renters that beach towns like Belmar must tolerate conduct that other towns never would.
Well, that’s a myth. To understand why summer rental tenants’ money doesn’t confer an economic benefit on a town like Belmar, you need to understand the rules that govern the tax system in New Jersey.
Rule 1: The State gets all sales and income tax money. So, none of the money you pay your landlords, or spend at D’Jais, the little Red Barn and 3 Brothers Pizza goes to Belmar. Not a dime.
Rule 2: The State doesn’t give Belmar a share of any of the tax revenue it collects here.
Rule 3: Towns like Belmar pretty much live or die on the property taxes they collect (and, we confess, the occasional fine).
Rule 4: As a general rule, the bigger and nicer the property, the higher the property taxes paid to Belmar. Owner-occupied homes tend to generate more in property taxes than summer rentals. They also require less police coverage. In addition, owner-occupied second homes require little in the way of municipal or school services.
Rule 5: Large concentrations of summer rentals tend to hold down property values in a neighborhood, reducing tax revenue to the community while also increasing police costs.
from the Belmar Summer Rental News, July 13, 2007