Budget may carry tax increase

Township Council rejects a proposed 21.7 percent hike.

By: Sharlee joy DiMenichi
   Smaller than expected ratable growth and increases in the cost of insurance and utilities could mean a 21.7 percent increase in municipal taxes, despite a proposed budget that is smaller than last year’s spending plan, according to Township Manager Matt Watkins.
   Members of the Township Council said they would oppose the budget as presented and told Mr. Watkins to make changes.
   Currently, the proposed $40.7 million 2004 municipal budget is about 2 percent smaller than last year’s $41.6 million spending plan and carries a tax rate of 56 cents per $100 of assessed valuation, up 10 cents from the previous year.
   Under the proposed rate, the owner of a house assessed at the township average of $188,600 would pay $1,056 in municipal taxes in 2004, up from $867 in 2003.
   The proposed spending plan was presented to the Township Council Tuesday by Mr. Watkins.
   Councilwoman Carol Barrett said Mr. Watkins should aim for no tax increase, layoffs or cuts in service when he makes revisions to the budget.
   "I’m going to actually ignore it because there’s absolutely no way you’re going to get any votes for that kind of increase," Ms. Barrett said.
   Mr. Watkins said the budget included no service cuts and no layoffs.
   According to information provided by Mr. Watkins Tuesday, ratable growth in the township has declined from 5 percent in 2001 to 3 percent in 2003 and is expected to slump to less than 2 percent in 2004.
   Mr. Watkins said that council members had worked to contain commercial and industrial growth, but that even the limited growth elected officials desired had not happened.
   He also said the cost of electricity, gas and street lighting will increase $165,420, from $917,000 to $1.082 million.
   In addition, the amount of money contributed by the township to the state pension fund is expected to increase $83,927. The township did not have to allocate money to the pension account in 2003 because state officials said the fund was over-funded, Mr. Watkins said. The state pension fund covers township police officers and fire officials.
   Garbage collection also is expected to increase, by $309,169, because of a new contract for garbage pickup and recycling. The township currently pays $1.6 million for collection of trash and recyclables.
   To offset some of the spending increase, Mr. Watkins said the township should apply for extraordinary aid from Trenton. However, that would require budgeting to spend the township’s $5 million surplus. The application for extraordinary aid would have to be filed by March 12 and the council would not be able to adopt its budget until July, after receiving a response from Trenton, Mr. Watkins said.
   Mr. Watkins said that extraordinary aid is awarded on a case-by-case basis with no set criteria, but that the state looks favorably on communities that appear able to regenerate their surplus and become self-sufficient within a year.
   "We, quite frankly, are in an enviable position in that we are able to grow our way out of this," Mr. Watkins said.
   Mr. Van Hessen said he opposed budgeting the whole surplus.
   "We need to put money away for a rainy day that we don’t touch unless it’s raining," Councilman Van Hessen said.
   The township had approximately $8 million surplus in 2002, $5 million of which it spent, according to a chart Mr. Watkins presented. In 2003, the surplus was approximately $6 million and the township spent about $5 million, according to the chart.
   Mayor Frank Gambatese said he expected the projected development of three warehouses and a hotel in the township to help regenerate the surplus. He also said revenue generated by a 3 percent tax on hotels would help .
   To decrease municipal spending, Mr. Watkins said he directed all department departments to decrease their budgets by 10 percent from 2003 and that Tuesday’s presentation reflected the cuts.
   Police Chief Michael Paquette said cutting the department budget involved reducing spending on nonessential training programs training officers in new computer techniques.
   "We don’t believe it’s going to adversely affect the services we provide," Chief Paquette said.
   In addition, Councilman Chris Killmurray said he did not expect departmental budget cuts to affect the library’s proposed $4.2 million expansion project because the township would bond to finance the addition and was pursuing county money.
   Library Director Lorraine Jackson said cutting the department budget would not stall the addition but would curtail her ability to expand the library’s holdings by limiting her resources.
   "It’s going to mean that we’re not going to be able to purchase as many new books and other materials as the public would like," Ms. Jackson said Wednesday.
   In addition to affecting township departments, Mr. Van Hessen said the spending plan would hit taxpayers already struggling financially.
   "We need to look at what the people in this town can afford," Mr. Van Hessen said.
   Mayor Frank Gambatese said that in spite of the revenue crunch, he believed Mr. Watkins and Chief Financial Officer Joseph Monzo would successfully revise the spending plan.
   "I’m absolutely confident that with time Matt and Joe will be able to bring this budget down to a line that is acceptable to us all," Mayor Gambatese said.