RANGERS FORCE GAME 7, LIKE THEIR CHANCES IN D.C. WITH LUNDQVIST IN GOAL. S-1 $1.00 MONDAY May 13, 2013
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NJ Transit silent on Sandy prep
Cites safety concerns while MTA releases detailed plans By KAREN ROUSE STAFF WRITER
As superstorm Sandy barreled toward the tri-state area, two of the nation’s largest transportation agencies worked to safeguard their systems, moving buses and rail cars to areas they thought would be protected. But NJ Transit and New York’s Metropolitan Transportation Authority had vastly different rates of success. Eleven MTA rail cars were damaged, compared with 342 pieces of NJ Transit equipNJ Transit released a redacted copy of its Rail Operations ment. Hurricane Plan, left, while the Metropolitan Transportation The MTA, which serves more than 11 million passengers on a Authority report, right, was more forthcoming.
Sparring over Libya attack unabated
typical weekday, moved its 6,200plus subway cars to higher ground, along with more than 500 locomotives and work cars. The agency identified more than 20 areas at risk for flooding. It used wind speed as a gauge for when to shut down operations. Many other moves took place, all detailed in a hurricane plan released as a part of a request under New York’s Freedom of Information Law. What NJ Transit did to prepare for Sandy remains largely secret. The agency that operates bus and light-rail and commuter rail services declined to release its strategy when requested under New Jersey’s Open Public Records Act.
When asked for communications regarding Sandy preparations, NJ Transit released a 3½-page “Rail Operations Hurricane Plan” that was stripped of all information except for the title. Agency spokesman John Durso Jr. said that detailing the agency’s storm preparation plans would create a security risk. “Recent events including the uncovering of an al-Qaida-led terrorist plot targeting rail service reinforces why NJ Transit will not disclose sensitive information that could potentially undermine the security of our transit infrastructure, our customers or our employees,” Durso wrote in an
ä For more on this story visit northjersey.com email last week. NJ Transit has been widely criticized for leaving its trains in low-lying areas as Sandy approached, specifically the Meadows Maintenance Complex — a sprawling 72-acre property in Kearny near the Hackensack and Passaic rivers — and its Hoboken yard alongside the Hudson River. The move is estimated to have cost the agency $120 million in damage, money NJ Transit hopes to recover through insurance and See NJTRANSIT Page A-6
Property owners may lose tax break
BOMB SURVIVOR STRUGGLES TO FIND PEACE
GOP expects more ‘whistle-blowers’; Dems back Clinton By SEAN SULLIVAN
N.J. among leaders in IRS deductions targeted for caps
WASHINGTON — The chairman of the House Intelligence Committee said Sunday that he thinks “more whistle-blowers” will come forward with information on the deadly attack last year on a diplomatic outpost in Benghazi, Libya. Democrats continued to question Republicans’ pursuit of the issue, saying the main purpose was to discredit former Secretary of State Hillary Rodham Clinton, a possible Democratic presidential candidate in 2016. “I do think we are going to see more whistle-blowers. I know certainly my committee has been contacted, I think other committees [have been contacted] as well,” Rep. Mike Rogers, R-Mich., said on “Fox News Sunday.” Rogers’ comments came days after three State Department officials, at a House Oversight and Government Reform Committee hearing, criticized the Obama administration’s actions regarding the Sept. 11, 2012, attack. “I will tell you, we have had people come forward because of the testimony and say, we would also like to talk, we feel a little bit intimidated by this, but have information we think is valuable,” Rogers said. Rogers also charged that the administration “changed the narrative” on Benghazi. New details surfaced Friday about emails that illustrated a clash between the State Department and the CIA over talking points in the aftermath of the assault in which four See LIBYA Page A-4
Several deductions that help offset the high cost of housing in North Jersey and the property taxes that come with it may be scaled back as the White House and Congress debate ways to overhaul the federal tax code. Among the 50 states, New Jersey is one of the biggest beneficiaries from the deductions of local property taxes, state income taxes and mortgage HERB interest. JACKSON Given how federal policy NJ/DC usually scales back the value of benefits as wealth increases, and targets spending toward lower-income beneficiaries, the deductions represent a rare case where a highwealth state such as New Jersey comes out near the top from a federal policy. But economists also see these deductions as an expensive “tax expenditure,” with a national price tag last year of $181 billion that would have otherwise been owed to the federal government, according to the Congressional Research Service. And that high price tag makes them a tempting target for House and Senate tax committees trying to rewrite the code to meet different policy goals without raising rates. For New Jersey, the three breaks combined were worth an average $9,879 per tax filer in 2011, about 80 percent higher See JACKSON Page A-6
THE WASHINGTON POST
AMY NEWMAN/STAFF PHOTOGRAPHER
Tim Sorbanelli of Oakland playing his guitar last week at a makeshift memorial near the Boston Marathon finish line. Sorbanelli, a music student, was injured by glass in last month’s bombing, then trampled by panicked bystanders.
Playing on in Boston
MIKE KELLY RECORD COLUMNIST
BOSTON – In a music room not far from Fenway Park, a young man from Oakland watched several classmates sing together one afternoon last week, their voices rising and falling in improvised melodies. The young man seemed lost in the moment, nodding gently to the beat and smiling now and then at the harmonies. For the first time in days, he said later, his thoughts did not wander to another part of town – to a piece of sidewalk near the finish line of the
Boston Marathon where two bombs exploded a month ago and he collapsed in a shower of glass and chaos. “I’m finally seeing the progression from bad to good,” Tim Sorbanelli said. A terrorist’s bomb inevitably leaves behind a wide array of victims. There are, of course, the tragic stories of those who lost lives or limbs. But then there are those who don’t make the official casualty lists. They were close enough to be cut by the shrapnel spray and to feel the blast
concussion in their chests. They sleep fitfully and wonder how they survived. They were not wounded badly enough to be rushed to a hospital or to make the TV news, but they are scarred nevertheless. Sorbanelli is that kind of casualty. He is 20 years old, two years out of Indian Hills High School and now a film score and percussion student at Boston’s prestigious Berklee College of Music. On the day of the marathon, he See KELLY Page A-4
INSIDE Hostage-taker is shot to death
Gunfire wounds 19 at parade
A 37-hour standoff in Trenton ended early Sunday with police killing a man who held three children hostage and was suspected of killing his girlfriend and a teenager inside a city home. Officers entered the house around 3:45 a.m. after noting the man's “deteriorating state of mind” and deciding it was necessary to ensure the captives’ safety, police said. The 38-year-old man was shot because he was threatening one of the children, police said. — Complete story on A-3
Nineteen people, including two children, were shot during a Mother’s Day parade in New Orleans on Sunday. No deaths were reported, but at least three of the victims were seriously wounded. Authorities said that most wounds were not life-threatening. Many of the people were grazed. The FBI said the shooting in the city’s 7th Ward, not far from the French Quarter, appeared to be “street violence” and wasn't linked to terrorism. — Complete story on A-3
Honoring la madre who lives far away For many businesses that help Latinos send packages and money home, Mother’s Day has become the busiest holiday. Across North Jersey on Sunday, Latinos sent gifts to mothers, wives and sisters who live in South and Central America. “Mother’s Day for us Latinos is very important,’’ said Jorge Palacio, the owner of De Prisa Multiservice in Englewood and similar businesses in Bergenfield and West New York. “Everyone is always grateful to their moms.” — Complete story on L-1
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Pope Francis canonizes many Pope Francis on Sunday gave the Catholic church new saints, including hundreds of 15th-century martyrs who were beheaded for refusing to convert to Islam, as he led his first canonization ceremony Sunday in a packed St. Peter’s Square. The first pontiff from South America also gave Colombia its first saint: a nun who toiled as a teacher and spiritual guide to indigenous people in the 20th century. — The Associated Press
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FROM PAGE ONE
A-6 THE RECORD
MONDAY, MAY 13, 2013
“Recent events including the uncovering of an al-Qaida-led terrorist plot targeting rail service reinforces why NJ Transit will not disclose sensitive information that could potentially undermine the security of our transit infrastructure, our customers or our employees.” JOHN DURSO JR., NJ TRANSIT SPOKESMAN
NJ Transit: Agency keeps its Sandy preparation a secret From Page A-1 federal aid payments. The Record, in collaboration with WNYC/New Jersey Public Radio, has asked for details about whether NJ Transit had identified locations in its statewide rail network that were at risk for flooding prior to Sandy; whether rail crews were on duty and prepared for Sandy prior to its surge making landfall; and if NJ Transit police officers assigned to its Office of Emergency Management were trained in reading weather forecast data. The agency’s leadership has declined to discuss its preparations in detail — instead referring the news organizations to information on its website, prepared press releases issued during Sandy and testimony that NJ Transit Executive Director Jim Weinstein has given during appearances on Capitol Hill and in Trenton before the Assembly Transportation Committee. Included among the Sandy documents NJ Transit released are weather and climate change reports and emails exchanged among the railroad’s leadership — including Weinstein, state Transportation Commissioner Jim Simpson, rail operations Vice President Kevin O’Connor and Durso — in the days leading up to, during, and after Sandy made landfall 40 miles north of Cape May on Oct. 29. Included in more than 800 pages of emails were discussions about press releases, talking points for reporters and updates for the governor’s office. The documents did show that NJ Transit prepared for Sandy in many ways. Diesel engines were ordered to be fueled. Emergency contact lists were shared. Employee unions were notified that sick time during the storm wouldn’t be honored without a medical note. Locomotives and cars were moved across the system. However, hundreds of emails that were requested about how storm preparations were handled at the highest levels of the agency were not released. Security concerns were cited as a reason for denying the public access to those records. In March, The Record sued NJ Transit under the state’s Open Public Records Act seeking access to those emails and the Hurricane Plan in unredacted form as well as the hundreds of emails that were withheld by the agency in their entirety. That lawsuit is pending.
Weinstein told the Assembly Transportation Committee in December that “the plan that was developed for the relocation of equipment is something that was put together by the railroad months before the action and they have lengthy conference calls on where the equipment is going and who is responsible for it and it’s all documented and detailed.” In an Oct. 27 email — two days before Sandy struck — Simpson directed the heads of the state Department of Transportation, the New Jersey Turnpike Authority and Weinstein to “finalize plans for Sandy and make sure we have planned for the worst.” Simpson declined
New York’s Metropolitan Transportation Transit Authority reported a total of 11 rail cars damaged as a result of superstorm Sandy. to comment for this story. And in an email describing talking points the day Sandy came ashore, the agency itself included a line that said, “No one should underestimate the power of the storm. At NJ Transit, we took this advice to heart.” Weather-related documents from the agency said there was a 10 to 20 percent chance of a 10-foot storm surge in Hoboken and a 5-foot surge in Kearny. After Sandy, Weinstein characterized it differently, telling the Assembly committee that there was an 80 to 90 percent chance the yards would not flood. Gary Szatkowski, chief meteorologist with the National Weather Service office in Mount Holly, said the conclusions NJ Transit drew from that document weren’t sound. “There was a 10 to 20 percent risk of a storm surge flooding in the rail yard area so they turned that around and said, well, there’s an 80 to 90 percent chance based on this forecast from the weather service that this rail yard wouldn’t flood,” Szatkowski said. “If you’re talking to your doctor and your doctor says there’s a 20 percent chance you could have a heart attack that could be serious to fatal in the next 72 hours, I wouldn’t turn that around and say there’s an 80 to 90 percent chance everything is fine.” Szatkowski said that given the proximity of the Kearny and Hoboken yards to water, “a 20 percent risk of even a 5- or an 8-foot storm surge is a catastrophe … whether you’re talking about people who live on the barrier islands or trains in a rail
“Our decisions were informed by the fact that neither of those rail yards had ever flooded. It is entirely wrong to characterize them as flood-prone.”
JIM WEINSTEIN, NJ TRANSIT EXECUTIVE DIRECTOR , AT A DECEMBER HEARING
Weinstein and O’Connor have said the dynamics of the storm changed after the agency began its shutdown on Oct. 28, the day before Sandy hit. O’Connor said at that point it was too late. “Having a plan to remove the equipment is not possible in 12 hours. There is no way I can move every piece of equipment out of the MMC [Meadows Maintenance Complex in Kearny] in 12 hours,” he said. But weather reports that Sandy was tracking inland came as early as Thursday morning, Oct. 25 — nearly four days before the storm hit and well before NJ Transit had even come to a decision on whether to shut down its bus, rail and light-rail lines. Szatkowski looked at forecast documents The Record obtained from NJ Transit and saw a problem with how data was entered into weather modeling software used by NJ Transit. The software requires emergency managers to input current conditions to predict the future track of a storm. Szatkowski’s conclusion, after seeing the NJ Transit documents, was that someone incorrectly entered the direction of Sandy as heading northeast, instead of the storm’s actual direction — west-northwest. When the correct information is entered into the model, Szatkowski said, the software predicts a catastrophic inland storm.
yard that has potential to flood.” At the December hearing, Weinstein said, “Our decisions were informed by the fact that neither of those rail yards had ever flooded. It is entirely wrong to characterize them as flood-prone.” Columbia University scientist Klaus Jacob, who helped write a report for the National Research Council on how climate change could affect transportation systems, said of the decision: “It just shows they don’t understand A) the hazard and B) the risk. The past, particularly when it comes to climate change, is not the guide for the future.” Durso and O’Connor spoke briefly with The Record and WNYC last Wednesday, after NJ Transit’s monthly board meeting. But when asked why the agency didn’t prepare for the 10 to 20 percent chance that the rail yards would Wind speed flood — as climate experts had warned — The MTA’s plan shows the agency had Durso abruptly ended the interview and identified specific locations across its rail refused to allow O’Connor to reply. system that are prone to flooding and in-
cluded instructions to avoid yards that sit in storm surge areas when storing equipment. It also said that when sustained gale force winds reach 39 mph, rail should be shut down. “Above that, it’s unsafe to have our people outside on tracks, unsafe to have our customers on platform,” said MTA spokesman Adam Lisberg. Durso did not respond to a question about whether NJ Transit’s hurricane planning considers wind speed in deciding on a shutdown. In an Oct. 27 email, a United Airlines official asked Paul Wyckoff, a member of NJ Transit’s executive staff, if a shutdown will occur when winds reach 40 knots or about 46 mph. The airline was trying to plan transportation for its employees. Wyckoff responded: “I don’t believe there is a hard and fast metric.” Damage to MTA equipment following Sandy was significantly less than what NJ Transit experienced. In fact, in addition to the 11 cars that needed repairs after the storm, another seven locomotives and six rail cars were damaged — they were left in NJ Transit’s possession and stored in the Hoboken and Kearny yards. NJ Transit has an agreement with Metro-North to provide service out of Port Jervis and Spring Valley and uses Metro-North Railroad equipment. When asked at the December hearing why NJ Transit suffered much greater losses than New York’s MTA, Weinstein replied: “I think they should be grateful for their good luck.” Weinstein and O’Connor have repeatedly said the agency could never anticipate flooding in the Kearny and Hoboken rail yards. But at an NJ Transit board meeting in September 2011, before Hurricane Irene hit New Jersey, O’Connor told NJ Transit’s board that in order to protect employees and equipment from damage and injury during Irene, “the decision was made to secure fleet in low-lying locations, such as Bay Head, Hoboken, Suffern, Gladstone and Atlantic City.” When asked why flooding in Hoboken couldn’t be anticipated during Sandy if the area was classified as “low-lying” during Irene, O’Connor said he was referring to the Hoboken terminal as low-lying, not the rail yard. But documents show a different story. Months before Sandy struck, NJ Transit had in its possession a $46,000 climate change study — commissioned by the agency — that warned of higher storm surges and said the Kearny and Hoboken rail yards sit in “storm surge areas.” Now, the agency has commissioned a new report — one to analyze NJ Transit’s performance during Sandy. “Clearly there are lessons that can be learned,” Durso said. Reporting for this article was developed in co-operation with WNYC/New Jersey Public Radio. WNYC reporters Kate Hinds and Andrea Bernstein contributed. Email: email@example.com, @rouse_karen
Jackson: Tax reform could be costly for N.J. homeowners From Page A-1 than the national average. One plan proposed by President Obama would cap the value of the deductions and bite harder in New Jersey than many other states. A study by Citizens for Tax Justice found that while only 3.6 percent of taxpayers nationwide would pay more under Obama’s plan, the rate would be 6.7 percent — almost double the national average – in New Jersey. And in some parts of North Jersey, tax data suggest the impact would be far higher. “New Jersey is one of the richest states, and people pay a fair amount in property and income taxes, and they take deductions for them,” said Steve Wamhoff, the legislative director at Citizens for Tax Justice, which generally favors higher taxes on the rich. “It’s a combination of those things.” Some in New Jersey say the wealthy can afford to pay more. “If you have a $5 million house in Bergen County, you pay a big chunk for property taxes and you like to deduct that,” said Gordon MacInnes, president of the liberal group New Jersey Policy Perspective. Obama’s proposal would make such homeowners pay more in tax, but it would not be “lifechanging,” he said. “They’ll still have plenty to do things they want to do and buy things they want to buy,” MacInnes said.Tax reform talks are in the early stages and still could stalemate, because Democrats and Republicans cannot agree on whether reforms should produce more revenue or just simplify the tax code to spur economic growth.
Deduction levels by income
The higher-than-average federal tax deductions New Jersey residents take for mortgage interest, property taxes and state income taxes are largely due to the state’s concentration of people in higher income brackets. But even people in lower brackets make more use of the write-offs because of the state’s high tax system and housing costs that lead to bigger mortgages. Here’s a comparison between the national average and New Jersey average for the amounts deducted from all three tax breaks combined.
Adjusted Gross Income All returns $1 to $25,000 $25,000 to $50,000 $50,000 to $75,000 $75,000 to $100,000 $100,000 to $200,000 $200,000 to $500,000 $500,000 to $1,000,000 $1,000,000 or more
USA $5,468 $498 $2,109 $5,418 $9,224 $16,593 $33,901 $66,400 $235,756
N.J. $9,789 $964 $3,133 $7,415 $12,377 $21,506 $42,300 $89,392 $303,073
Source: Internal Revenue Service tax data for 2011
But with a potential crisis looming over the need to raise the federal debt limit again, lastminute deals could be struck between Obama and Congress that change both taxes and entitlement programs. Obama, in his 2014 budget proposal, called for capping the value of the three deductions, along with other things, at 28 cents on the dollar for taxpayers in the upper-income brackets. Generally, that means there would be no impact on people in the 28 percent bracket or lower, defined this year as couples filing jointly with $223,000 in taxable income or less. Those in higher brackets, whose deductions right now are worth 33 to 39.6 cents
per dollar, would have to pay more. But the unanswered question is whether putting a cap on the value of deductions for some opens the door to even bigger reductions. Wamhoff said that the mortgage interest deduction has a strong lobbying effort to protect it, with home builders and real estate agents pressing members of Congress in both parties. But he said the deductions for state income and local property taxes – which, tax data show, are even more valuable to New Jersey residents – do not have the same kind of advocates. That view was shared by Rep. Bill Pascrell Jr., a Democrat from Paterson who has spent the
Federal tax deductions for property taxes, state income taxes and mortgage interest are worth more in New Jersey than in most other states, and they are under examination as Congress considers simplifying the tax code to produce lower rates and reduce the deficit. Here's a look at national, state and local figures for the value of the average deduction taken by taxpayers in the three categories. Income Property Mortgage tax tax interest
USA average N.J. average N.J. rank among states Morris Co. average Bergen Co. average Passaic Co. average
$1,827 $3,192 5th $5,897 $5,645 $1,672
$1,179 $3,234 1st $4,595 $4,196 $2,546
$2,462 $3,362 8th $6,213 $5,317 $3,311
Source: Internal Revenue Service. Note: Statewide and national data are from tax year 2011; county data is from a Record analysis of ZIP code-based data for tax year 2008, the most recent available.
last two months serving as vice chairman of a Ways and Means Committee task force looking at real estate taxes in the federal code. “I see more Republican defense of the mortgage interest deduction than I do for the state and local tax deduction. I don’t believe they understand what the implications are,” Pascrell said. Depending on how tax reform is ultimately done, even New Jersey residents in lower brackets could end up paying more if the three deductions are trimmed. The uniform federal tax code does not take into account differences in the regional cost of living. That means a couple earning $150,000 in New Jersey, where the real estate website Trulia showed the median price of a
trolled House calls for eliminating unspecified tax breaks — the Ways and Means Committee is supposed to decide which — to produce a tax code with fewer tax brackets and a top rate of 25 percent. It also says the tax code should generate the same amount of revenue as it does now. Pascrell and some economists say that will help the wealthy and hurt the middle class. “What they’re talking about here is forcing more taxes on the middle class or the math doesn’t work out. There is no way to do it,” Pascrell said. Along with popular deductions, the committee is looking at whether income and benefits currently exempt from taxation, such as interest on municipal bonds and employer-provided health insurance and pensions, should be taxed. Obama’s plan has been disparaged by Republicans in Congress, and Democrats have been slow to embrace it, too. Pascrell said he would prefer a cap, like the kind Obama proposed, to a total phase-out of deductions for mortgage interest and state and local taxes. But he said he’s not sure the cutoff Obama set is the right one. “The president’s proposal is to limit itemized deductions, not eliminate any individual tax expenditure. It acts as an aggregate limitation,” Pascrell said. “That path is worth looking at, but my cutoff would be a higher one.”
home listed for sale last week was more than $435,000, are treated the same as if they lived in Ohio, where the median home was selling for $177,000. While liberal groups are arguing the wealthy should be forced to pay more, some conservative groups are pressing to phase out and ultimately eliminate many deductions in favor of lower rates with fewer brackets. Americans for Prosperity, for example, argued in a report to the House Ways and Means Committee that federal tax deductions could drive up costs by encouraging home buyers to spend more than they should, while governors and mayors might raise taxes higher than they otherwise would. Email: firstname.lastname@example.org The 2014 budget plan ap- Blog: northjersey.com/ proved by the Republican-con- thepoliticalstate