CRANBURY: Mayor pushes for no tax rate hike

By David Kilby, Staff Writer
   CRANBURY — Mayor Win Cody offered a presentation on this year’s proposed budget during a special workshop session of the Township Committee on Monday.
   At the last meeting Feb. 28, Mayor Cody said the committee owes it to the public to explain the numbers in the budget, show a budget history of the past 10 years and show what numbers the entire committee agrees upon as well as those numbers it disagrees upon.
   The proposed total budget is $10,811,557 with $9.9 million of actual expenditures. It recommends using $1.7 million of the township’s $4.9 million of surplus and has a debt service of $2,149,726.
   This budget would raise taxes from 37.5 cents to 39.5 cents per $100 of assessed value. An owner of a house assessed at the average of $608,299 would pay $2,403 per year in taxes if the budget is passed. Last year, the same owner paid $2,315 when the average house was assessed at $617,439.
   Due to a possible 4-cent school tax rate increase, the average taxpayer in Cranbury may be looking at a $500 total tax increase this year if the current proposed budget is passed. The municipal budget can be amended at the next meeting March 28.
   Mayor Cody had recommendations on how to amend it. In his presentation, he recommended a total budget of about $10.3 million with the same amount of actual expenditures, $9.9 million. He recommends paying off $1.9 million of the township’s approximately $23 million in debt, and said this will leave the township with a surplus of $4.5 million at the end of the year while keeping the tax rate flat at 37.5 cents.
   The rest of the committee disagreed with some of his projections, and this led to a deeper review of the numbers.
   In 2007 a penny of taxes raised about $185,000, and this year, a penny raises about $160,000, due to a decrease in property value, the committee said.
   Also in 2007, state aid amounted to about $700,000, and this year it is proposed at $467,020. The committee actually isn’t certain if it will receive the state aid money proposed.
   In 1999, the township’s budget was $6 million. In 2002, it was about $6.5 million, and in 2007 it was about $12.5 million, Mayor Cody explained in his presentation.
   ”We’ve had quite a run up in spending the past 10 years,” Mayor Cody said.
   The main cause of the spike in spending is due to debt repayment, said Denise Marabello, chief finance officer and business administrator, but the committee has successfully kept the budget relatively flat between $10 million and $11 million the past few years.
   Municipal taxes for the average house have gone from about $1,400 in 1999 to $2,500 in 2008, but went down to $2,300 in 2010 and could go back up to $2,400 in 2011, Mayor Cody shared.
   He said the future doesn’t look that bad, but the rest of the committee said it would be prudent to prepare for the worst.
   ”We have different views on the projected numbers,” Mayor Cody said. “But we agree on the base numbers.”
   While the rest of the committee believes it would be prudent to raise taxes 2 cents, Mayor Cody said, “we shouldn’t raise taxes unless we absolutely have to.”
   But according to the rest of the committee, Cranbury’s surplus is in jeopardy.
   Committeeman Dave Cook said the committee hasn’t raised taxes the past three years, and this is one of the reasons surplus is decreasing faster than it can be replenished.
   ”The surplus is a significant part of our budget, about 19 percent of what we’re paying our bills with” he said.
   If the township continues to cut in to the surplus, eventually it will have to look for other sources to pay the bills, he explained.
   But surplus also has gone up from $2 million in 1999 to $4.9 million this year. That equates to 45 percent of the budget. The only other town in central New Jersey that has nearly that high of a surplus percentage is Rumson, which has a surplus that is 36 percent of its budget, Mayor Cody explained.
   ”All I can say is we are in an enviable situation compared to surrounding towns,” Committeeman Glenn Johnson said. “But among those towns, there isn’t any I’d switch places with.”
   ”If surplus is for a rainy day, then I’ve had people tell me it’s raining,” said Phylissanne Stehn, of Hardley Drive.
   ”I would like for every Township Committee member to ask themselves, ‘what did you state when you were running for a seat on the committee?’” she said to The Cranbury Press.
   She said that while campaigning, the committee members said they would do their best to keep taxes down.
   ”If you’re comfortable that you’re doing what you campaigned for, that’s fine,” she said. “It’s easier to campaign than it is to govern.”
   Ms. Marabello and the committee believe it would be most prudent to pay off as much debt as it can so Cranbury doesn’t lose its high AAA bond rating. Currently, the interest rate for bonds is 1.5 percent, but this percentage may change in September, the committee said.
   ”It’s always prudent to pay down debt when you can,” Ms. Marabello said.
   Cranbury’s debt has gone from about $10 million in 1999 to about $31 million in 2006 to about $23 million in 2010, Mayor Cody said. [mrh: explain why?: ]If the township does receive the proposed $467,020 in state aid, the majority of the committee would like to put it toward paying off that debt.
   This is the main change in the budget since the official budget meetings Jan. 15, 22 and Feb. 15.
   Resident Dave Mauger said he regrets not attending the Saturday budget meetings in January.
   ”My penance for that (missing the meetings) looks like it’s going to be about $100,” he said. “I consider that a pretty good deal overall.”
   He added, “Thank God we’re in Cranbury where the argument is ‘how prudent is too prudent?’”
   Many members of the public said it seems like the committee is just raising taxes because it can.
   ”If the opportunity comes to lower my taxes, I trust you’ll take that opportunity as well,” Mr. Mauger said.
   As unlikely as that seemed to the public, the committee said lowering taxes in the future is not out of the question if it raises taxes this year.
   But there was also concern that by raising taxes this year, it would be tougher to sell expensive houses due to the high property taxes on such houses. Higher taxes also would deter businesses from moving in to town, Mayor Cody noted.
   Paul Aprigliano, of Hardley Drive, said if the committee finds a way to not raise taxes in this “great recession,” it would be a bit of good news for Cranbury residents in tough times.
   ”This is the time to show some austerity,” he said.
   While many were arguing about the tax rate, others said it’s really not the bottom line.
   ”Everything comes down to expenditures,” said Steve Benner, tax assessor. “The tax rate is just a multiplier. Everything comes down to how much you spend at the end of the day.”