A public hearing on the budget will be held at 7 p.m. July 7 at Borough Hall
By Aleen Crispino, Special Writer
Hopewell Borough Council voted unanimously at its meeting June 6 to introduce a $2.6 million budget for 2008, a 5 percent increase over last year’s $2.48 million budget.
Since the state has capped increases in municipal tax levies at 4 percent in 2008, the extra 1 percent increase in expenditures would be made up by revenue sources other than taxes, said borough Chief Financial Officer Judie McGrorey on Tuesday.
The new budget, if adopted by council, would increase the municipal property tax rate by 5 cents per $100 of assessed value, said Ms. McGrorey.
With the average home in the borough valued by the tax assessor at $452,312.62 in 2007, a 5-cent increase in the tax rate will add about $226 to the average annual municipal property tax bill – from $1538 in 2007 to $1764 in 2008.
There are several reasons for the proposed increase. The state has cut municipal aid to the borough in 2008 by approximately $140,000, said Borough Administrator/Clerk Michele Hovan, and so far has restored $22,000 of that amount, for a net reduction in aid of $118,000. In addition, there are “significant increases” to the annual contributions by the borough to the township for interlocal service agreements, particularly for police services, said Ms. Hovan.
The budget has been trimmed wherever possible without reducing essential services, she said. “We are reducing volume of services. Maybe we can’t do as much pothole repair. We’re not doing anything drastic,” she said.
Another concern voiced by Ms. Hovan and Ms. McGrorey, as well as some members of council, is the need to preserve sufficient surplus funds for unexpected expenses. A smaller increase in the municipal property tax rate of 4 cents per $100 of assessed value would leave the borough with a shortfall of approximately $200,000, which would have to be subtracted from the approximately $500,000 surplus left from previous years, said Ms. Hovan, leaving the borough with a surplus of $300,000 in 2008 for emergency expenditures.
”Are we really jeopardizing ourselves with so little in reserve?” asked Councilman Schuyler Morehouse.
”I think you are,” said Ms. McGrorey.
”I hate the thought of another penny on the borough (tax rate), but I’m concerned that we put ourselves in a difficult situation if you don’t at least plan,” said Councilman Mark Samse.
At an average of about $50,000 in retained earnings each year, it would take at least four years to recover $200,000 spent from surplus funds, said Ms. Hovan. With an increase of 5 cents per $100 in the tax rate, “we should be able to recover enough next year” to keep the surplus at its present level, she said.
The borough tax is only one portion of the total property tax bill. Others include the school district tax (increased 6 cents per $100 for 2008), the county tax (increased 2 cents per $100 for 2008), and the fire district tax (which will remain the same for 2008), said Ms. Hovan.
If the borough adopts the proposed 2008 municipal budget, with its 5-cent-per-$100 increase, borough property owners will see a total increase of 13 cents per $100 of assessed value on their 2008 tax bills, an annual increase of approximately $585 in municipal, county and school district taxes on an average home assessed at $452,312.62.
Copies of the proposed 2008 municipal budget are available at the office of the municipal clerk at Borough Hall, Columbia and South Greenwood avenues.
A public hearing on the budget will be held at 7 p.m. July 7 at Borough Hall. At that time, council will listen to public comment and vote on whether to adopt the budget.
IN OTHER BUSINESS, council adopted an ordinance to adopt the Mercer County Recycling Plan as the borough’s municipal recycling program.
Also, Council President David Knights read a proclamation from council and Mayor Paul Anzano, honoring “Hopewell Valley News” Managing Editor Ruth Peterson Luse for her 42 years of service to the borough. Ms. Luse was presented with an “Outstanding Community Service” award June 5 at a Mercer Regional Chamber of Commerce, Hopewell Chapter reception at Hart Farm.