SOUTH RIVER — The Borough Council unanimously introduced a tentative budget that calls for no tax increase, a drastic difference from the 19-percent increase that loomed over taxpayers last year.
Mayor Raymond T. Eppinger, in his second year as mayor this year, stressed that last year’s lofty increase was necessary, as was the state-granted tax levy waiver for $435,000 in additional tax monies.
Eppinger pointed to the fall of 2007, when councilmen Anthony Razzano and Michael Trenga and then-Councilman John Krenzel voted to approve a 67-percent electric rate increase, with the three and Eppinger agreeing the action was needed to reflect cost increases and for long-range planning.
“… It had to happen, and we caught a lot of nonsense for it,” Eppinger said. “Here we are now with a no-tax increase [budget, when] literally no towns are in the same situation as we are, and there are no cuts in service.”
The mayor, who said his administration is continuously fulfilling its promise to restore fiscal order to the borough, said there are no one-shot revenue deals in this year’s budget.
The proposed budget totals $31,343,647. The average homeowner pays approximately $5,200 in taxes for a home assessed at $84,000. The borough tax rate, which increased by 31.9 cents last year, would remain at $1.945 per $100 of assessed valuation.
The borough has three major budgetary components — the water utility, which will see a 15-percent increase this year, bringing the total to $3,196,357; the electric utility, which totals $13,028,505; and the current operating fund of $15,118,784.55.
This year, to balance the $31.3 million spending plan, officials said the borough will have to use the majority of the $2.7 million in surplus that was accrued in part by the 67- percent increase in electric rates last year.
“This surplus came back into a direct form of tax relief,” said Borough Business Administrator Andrew Salerno.
The business administrator said he was 97-percent certain that the borough could generate surpluses in the electric utility for the next two years; however, he said that will change by June 1, 2012, due to wholesale pricing.
“We have to hedge and be in control when that time comes,” said Salerno, who said it is important to implement a five-year long-term budget plan stabilizing property tax rates. “I’m already in 2012, it is so important for us to continue what we are doing, we do not want to wait or be hit with what we were hit with last year. The five-year plan should have been in place over time.”
South River is one of several towns including Milltown, Lavallette, Seaside Heights and others that operate an electric utility as part of a co-op Public Power Association.
Part of the surplus in the electric utility was due in part to a telephone pole project that netted $628,000. A total of 2,329 telephone poles were inventoried last spring, where Salerno came upon unpaid rental bills from several companies.
All council members said they were in favor of the proposed zero-percent tax increase; however, Councilman Rui Almeida said he is concerned about the borough’s use of the surplus, and that he would discuss his concerns at the public hearings.
Public hearings on the budget will be held from 6:30-7 p.m. on April 13 and April 27 in council chambers, 61 Main St. Final adoption of the budget is expected on May 11.