ALLENTOWN: Borough has small tax reduction

By Joanne Degnan, Staff Writer
   ALLENTOWN — The Borough Council has introduced a $2.41 million municipal budget that will provide the owner of the averaged assessed borough home with a slight tax reduction this year.
   ”It is absolutely good news,” Mayor Stuart Fierstein said. “The important thing is that, in spite of the revaluation that we were ordered to do, the average home is still going to see a decrease in (municipal) taxes.”
   The 2011 budget introduced April 26 contains a $1.21 million municipal tax levy, which is the amount of taxes needed to sustain the operating budget. The levy is $53,000 less than the allowable amount permitted under the state’s 2 percent cap law, according to the budget documents.
   Mayor Fierstein said Monday that the projected local tax rate would be $0.621 cents per $100 in assessed value. That works out to $1,825 a year — a $2 decrease — for the average borough home, which is now assessed at $294,000.
   Last year, before the 2010 revaluation was completed, the average value of an Allentown home was $153,400 and the tax rate was $1.191 per $100 in assessed value. That worked out to a $1,827 municipal tax bill.
   ”A revaluation throws all the numbers out of whack and causes people concern when they get a notice that their assessed values have nearly doubled from the time of the last reval in the mid-1990s,” Mayor Fierstein said. “As long as the new value is not more than double what it was, they will see a decrease in municipal taxes. There is also no increase in water or sewer as well.”
   The total value of all properties in the borough before the revaluation was $102 million, Mayor Fierstein said. Today, the total value of borough properties is $195 million, an increase of 91 percent.
   ”The increase in the town’s value is comparable to the increase in an individual house’s value,” Mayor Fierstein said. “If, for example, somebody’s house went up 300 percent, then they are going to see an increase (in taxes), but I don’t know that anyone’s house went up that much.”
   Mayor Fierstein said the budget was introduced later than usual this year for several reasons, including the departure of the borough’s full-time CFO Robert Benick in January, which postponed the audit process.
   The borough also was awaiting the results of the 2010 revaluation as well as the signing of a cell tower lease with MetroPCS that was needed in order to include the $26,700 in revenue the deal will provide to the borough in the 2011 budget, the mayor said.
   Instead of hiring a full-time CFO to replace Mr. Benick, the borough negotiated an interlocal agreement with Plumsted Township to share the services of its CFO, June Madden. Switching to a part-time CFO will save the borough more than $35,000 a year, Mayor Fierstein said.
   The borough also has interlocal agreements with Robbinsville for public works, fire inspections, the construction office, automotive garage services and white goods and electronics recycling, Mayor Fierstein said.
   ”We look for interlocal (agreements) in the smallest nooks and crannies because our budget is smaller than an average town’s,” Mayor Fierstein said. “We have to look at all the pennies because our numbers are so small to begin with.”
   A one-year contract extension was negotiated with the town’s five police officers, giving them a 1.5 percent salary increase in return for the officers agreeing to pay 1.5 percent of their salaries toward their health benefits, the mayor said.
   All other township salaries remain frozen for 2011, he said.
   The borough’s contributions to the First Aid Squad and Fire Department remain essentially flat for 2011, according to the budget documents.
   The $28,850 contribution to the squad and $34,000 direct contribution to the volunteer Hope Fire Company are the same, and a separate line-item appropriation for fire expenses, which is paid to Upper Freehold for costs associated with the salaries of the department’s six career firefighters, will increase $1,000 to $68,500.
   The township and borough have been at odds for years over funding of the Fire Department, which operates without a fire tax and depends on stipends from the two communities it serves.
   In February, Upper Freehold threatened legal action if the borough did not increase its annual contribution by $50,000 a year and pay half the cost of past equipment purchases and firefighters salaries since 2006 — an amount the township says totals $486,189.
   Allentown’s officials argue they should not be charged half of the Fire Department’s costs because the borough represents only 14 percent of the tax base, 21 percent of the two communities’ combined population and 17 percent of the Fire Department’s calls.
   The dispute remains unresolved.
   The public hearing on the 2011 municipal budget will be held Tuesday, May 24, provided the state Department of Community Affairs approves the draft budget document prior to that date, Mayor Fierstein said.