By Sean Ruppert, Staff Writer
HIGHTSTOWN The borough took another hit on its balance sheet when the state recently announced it would be cutting aid to the financially strapped municipality by about $16,000 in 2009.
However, the amount of aid the borough is required to transfer to the school district also decreased, resulting in a net loss of about $11,000, Borough Administrator Candace Gallagher said this week.
The borough is facing an approximately $500,000 shortfall the equivalent of about a 24-cent tax increase under the tax valuation before the just-completed revaluation.
The Borough Council had been assuming flat state aid in its budget discussions before the aid figures were released by the state Department of Community Affairs on March 13 so the new figures put it further in the hole.
”We are going to have to add that figure onto the $500,000,” Councilman Larry Quattrone said at Wednesday’s budget session.
In 2008, the borough received $649,228 in total formula aid. It will receive $632,998 in 2009.
This comes on top of a loss of $50,000 in Homeland Security grant money that was eliminated by Gov. Jon Corzine in February. Hightstown also received $200,000 in extraordinary aid from the state last year. The borough plans to apply for the extraordinary aid again this year, but there is no guarantee so it cannot be assumed in the budget. The council must approve the budget before the borough can apply for the extra aid.
Councilman Jeff Bond was critical of the state’s cuts to municipal aid.
”To me, it is like telling your kid he can’t have his allowance this week because daddy needs a pack of cigarettes,” he said Wednesday.
Despite the shortfall in the budget; the council seemed to come to a consensus against participating in the one-year pension contribution deferral plan that was signed into law Wednesday by Gov. Corzine. An informal vote prompted by Council President Walter Sikorski came out 5-1 against the deferral with Councilman Dave Schneider the lone dissenter. Mr. Schneider stopped short of actually endorsing the idea, instead saying the council should consider it.
The optional plan halves the amount municipalities are required to contribute into the state’s pension systems for police, fire and other public employees in 2009. The towns then have to make up the amount deferred over the next 15 years, with interest, along with their regular contributions, Borough CFO George Lang explained Wednesday.
The deferral would save the borough $187,000 this year.
”I would rather just take the hit this year and get it over with,” Mr. Sikorski said of the pension contributions.
”All you would be doing is prolonging the pain. What’s the point of that?” Mr. Bond said.
Despite the informal vote, the council still asked Mr. Lang to research what the interest rate is on the deferral.
Mr. Sikorski also suggested the borough look into re-negotiating contracts with its union employees to reduce health insurance costs, which will increase by $127,400 to $486,500 in 2009. Mr. Sikorski cited Gov. Corzine’s plans to furlough workers and freeze wages for union employees as precedent.
”We shouldn’t just throw up our hands and say ‘Oh, we have a contract, so we can’t do anything,’” he said.
The council also discussed bringing in a professional negotiator for the next union contracts. The agreements run out at the end of this year, and Ms. Gallagher said negotiations likely will begin in the summer.
The council also reviewed the Public Works budget Wednesday with Director Larry Blake. The council did not make any additional cuts.
The council was scheduled to meet again on the budget Thursday night after the Windsor-Hights Herald’s press time and at 7 p.m. Monday at the municipal building.

