By David Kilby, Staff Writer
CRANBURY — The Township Committee introduced its 2011 budget at its meeting Monday to a room filled with residents and explained to them its decision to increase the tax rate by 2 cents.
If passed, the township’s budget will be $10,811,557. At the last public budget meeting Feb. 15, the committee proposed a $10,344,537 budget, but that was before the township received $467,020 in state aid.
The committee decided to place the state aid toward debt service.
The budget now includes $641,843 for administrative and executive costs; $641,290 for professionals and boards; $2,450,292 for public safety; $672,016 for Public Works; $750,342 for statutory expenditures; $790,850 for utilities; $811,399 for insurance; $572,604 for the library; $965,395 for interlocal agreements; $2,109,727 for debt service; $149,426 for the reserve for uncollected taxes; and $256,373 for other expenses.
Last year, the tax rate was 37.5 cents per $100 of assessed value. An owner of a residential property assessed at the average of $617,439 paid $2,315 per year in property taxes.
This year, the average residential property is assessed at $608,299 so the same owner would pay $2,402 per year if the proposed 2 cent increase is approved.
At a recent League of Municipalities meeting with 74 mayors, Mayor Win Cody spoke with other mayors in the area about budgets.
”Everybody’s saying their budget is under pressure,” Mayor Cody said. “A lot of people are talking about shared services.”
Committeeman Dan Mulligan said there is an opportunity to share services internally such as between the township and school.
The Board of Education and committee have spoken of possibly sharing custodial and IT services.
Nothing has been confirmed regarding shared services in the township, though, so the committee still is creating new ways to save money.
At the meeting Monday, the committee passed an ordinance allowing the township to reserve 1.5 percent to 3.5 percent of its budget if it stays under the 2 percent cap mandated by the Local Government Cap Law.
”It means we could (bank the money). It doesn’t mean we will spend 3.5 percent,” Mayor Cody said.
The committee, with the exception of Mayor Cody, fears the surplus will start to decline if the township doesn’t do something to contribute to the surplus now.
Mayor Cody said that at the League of Municipalities’ meeting of mayors, everyone was “shocked we had such a high surplus.”
”Hamilton was boasting of a $4 million surplus with a $100 million budget,” he said.
Cranbury has a surplus of $4.9 million, but plans to use $1.7 million of it this year.
In the past few years, the township’s surplus has increased slightly, from 37 percent of the total budget five years ago to 45 percent this year, Mr. Mulligan said.
”The rest of the committee wanted to raise taxes 5.3 percent,” Mayor Cody said at the meeting Monday. “My perspective is it’s the absolute wrong thing to do.”
”The environment has been tough the last two to three years,” Committeeman David Cook said in response.
He said that around 2003, Cranbury had a development boom on the east side of Route 130, bringing in a great deal of revenue from warehouse construction and sewage hookup fees, but now the lease rates for warehouse space are going down.
”We’re actually spending surplus faster than we’re replenishing,” he said.
He said at the rate things are going, the township surplus will be at zero by 2016.
”I agree to the 2 cent increase at this time because I think it’ll help us in the transition at the time when we don’t have such a large surplus to work with,” he added.
He said there are many future expenses the township may have to budget for, such as the Liberty Way bridge and Brainerd Lake bridge repairs and possible future affordable housing projects.
The Liberty Way bridge project may cost the township $8 to $16 million, but there is a possibility the county or state will pay for it.
”There’s a possibility, but I wouldn’t bank on it,” Mr. Cook said.
Brainerd Lake bridge repairs could cost up to $2 million, and future affordable housing projects could cost up to $4 million.
Mr. Mulligan commended the committees of prior years, but agreed with Mr. Cook that the committee has to prepare for the worst.
He said Township Attorney Steve Goodell has suggested reserving an extra $1 million for tax appeals.
”We’re actually very fortunate we haven’t had a large tax appeal,” Mr. Mulligan said.
For the most part, though, Cranbury has over-budgeted many township expenses, such as tax assessment, planning and zoning, police, Public Works, animal control, court, affordable housing, finance, vehicle maintenance, sewer utilities, recycling, legal expenses, health insurance, salary wages and social security, emergency management and rock salt. All these items added up to a $788,000 contribution to the surplus this year because of unspent balances.
Mr. Mulligan also mentioned there has been an $80,000 increase in pensions this year. Pensions for public employment retirement amount to $138,096, and for police and fire retirement pension, the cost is $328,176.
The only way to compensate for these increased expenses is to raise taxes, Mr. Mulligan explained. “The tax rate had remained flat (last year), but the average value of a home has gone down,” he said. “A penny brings in 9,000 less dollars than last year. If we raise the revenue two cents, we’re essentially trying to raise the same as last year.””It was a disappointment to find we’re in the situation we’re in,” Committeeman Glenn Johnson said.
He said when he was campaigning, the main thing he heard from residents was they were not pleased with how drastically the sewage bill increased from 2009 to 2010.
The quarterly average for a sewage bill in Cranbury is $56.25 and 6.60 cents per 1,000 gallons of water use, except for areas that have septic.
In 2009, the quarterly average was $17 and 2.75 cents per 1,000 gallons.
”They would have accepted smaller increments over time instead of one big jump,” Mr. Johnson said.
That wish of residents is the principle the committee is hoping to apply to this year’s budget since raising taxes 2 cents this year will prevent the need to raise taxes drastically in the future, Mr. Johnson explained.
”The prudent thing to do is plan for the unfortunate,” he said.
John Consoli, of Parkview Road, said it’s admirable for the committee to be fiscally prudent, but said no one knows what will happen in the next few years.
”We live in an affluent town,” he said. “Two cents to me is $150. I can afford it, but it comes from my fund for going out with my family, supporting Main Street businesses. You say this won’t affect the quality of life. I think it does.”
Alan Danser, of Petty Road, and former mayor of Cranbury, said the important thing is not how much surplus the township uses.
”The important thing is to watch the expenditures,” he said. “If you’re doing a frugal job managing expenditures, revenue will kind of take care of itself.”
”We can’t forecast the future, but I don’t see any indicators saying revenue will increase itself right now,” Mr. Mulligan responded.
Tom Ingegneri, of South Main Street, and owner of The Cranbury Inn, wanted to know what the committee was doing to cut costs.
”That’s part of the budget process,” he said. “You got to look at your expenses to make tough decisions. That’s what’s not happening in our state.”
He also said he wanted to see the committee agree on its assumptions.
”I could sit here all day and forecast,” he said. “If I were running a business and had this much surplus, I’d say we’re fat, and we’re well off.”
He added, “It’s easy to raise taxes 2 cents. It’s hard to make tough decisions. But you can do it. We put you in office because we believe you can do it. Cost reduction is the answer.”
Mr. Mulligan said the assumption the committee has agreed upon is that even with a flat budget, without a tax increase, by 2014, the township would be in trouble.
”And assuming a flat budget is optimistic,” he added.
Mayor Cody said he believed the committee owes it to the public to publish its assumptions, the history of the township budget and each line item that can be put on the table.
”We’re going to go into detail so that people understand. We have to share this information,” he said. “We’re talking about numbers. They don’t know what we’re talking about,” he said.
His comment was followed by applause.
”The intent isn’t to hide anything,” Committeeman Jay Taylor said, adding the committee had budget books available to the public at each of its three budget meetings, which were poorly attended by the public since they were Saturdays and a Tuesday, not Monday — the usual day for Cranbury Township Committee meetings.
The entire 59-page proposed budget and a budget summary are on the Cranbury website, www.cranburytownship.org.

