LAWRENCE: Budget with a tax hike moves ahead

By Lea Kahn, Staff Writer
   Township Council voted unanimously Tuesday to introduce Lawrence Township’s proposed $43.3 million municipal budget for 2012, which calls for a 5-cent increase in the municipal property tax rate.
   Mayor James Kownacki and council members Cathleen Lewis, David Maffei and Greg Puliti voted to introduce the budget, clearing the way for a tentative April 18 public hearing and final vote. Councilman Michael Powers was absent.
   But Township Council’s introduction of the proposed budget did not escape comments and questions from the handful of township residents who were sitting in the audience.
   If the council passes the budget next month, the 2012 spending plan would raise the municipal property tax rate from 84 cents per $100 of assessed value to 89 cents.
   The 5-cent tax rate hike translates into an $81 increase in the municipal tax bill on a house assessed at the township average of $160,282 — from $1,350 in municipal property taxes in 2011 to $1,431.
   But there is a chance that the municipal tax rate may increase by an additional 9 cents, if voters approve a referendum question April 17 that allows the township to exceed the mandatory 2-percent cap on increases to the municipal tax rate.
   The 9-cent increase means the owner of that property would pay $144 more in 2012, in addition to the $81 increase resulting from the 5-cent property tax rate hike. The total tax rate increase would be $225 on a house assessed at $160,282.
   Township officials have said repeatedly that the need for a 9-cent increase is not related to spending. The issue is that to comply with the 2-percent cap on the increase to the property tax rate, it would be necessary to plug in $4.87 million in surplus funds into the budget as a source of revenue. It would wipe out most of the available surplus fund of $5 million, leaving $154,000.
   Municipal Manager Richard Krawczun has said it would not be possible to “regenerate” that amount of money to be included as a revenue source in the 2013 budget. It might be possible to regenerate $2.6 million, but not the entire amount. The 9-cent property tax rate increase would generate $2.2 million, preserving some of the available budget surplus funds.
   If voters reject the referendum for an additional 9-cent increase, township officials are prepared to eliminate garbage collection and disposal as a municipal service included in the property tax bill. Garbage would still be picked up, but homeowners would be billed for the service — much as they are billed for sewer service.
   During the public participation portion of the meeting, which preceded the budget introduction, Review Avenue resident Carol Harle questioned the need for the 9-cent tax rate increase. She called it a stopgap measure and that it would not solve the problem.
   ”It’s a cop-out,” said Ms. Harle, who is a former mayor and Township Council member. She said the solution is a combination of new revenue and spending cuts.
   Ms. Harle offered a laundry list of suggestions to save money, including calling on Mayor Kownacki and Township Council to “give up” their salaries until the financial crisis is over. She suggested cutting back to a four-day workweek, and for Mr. Krawczun and department heads to take a salary cut, also.
   Among those suggestions, she called on the council to focus on putting exempt properties on the tax roll, and to enact fees on renters and Rider University students. Renters and students should pay their fair share because they all use municipal services, she said.
   ”The real thing here is getting more money,” Ms. Harle said.
   Mr. Krawczun replied that furloughs are negotiable items with the employees’ unions, but about half of the 190 or so township employees would be exempt from furloughs — police officers, the handful of paid firefighters and the emergency medical technicians — because they are emergency responders, he said.
   He rejected a renter’s fee, noting that landlords pay a fee to register properties that have two or more rental units. There is an annual inspection, fee, too, he said.
   Township Council also has been “very aggressive” in pursuing student fees, but to no avail, Mr. Krawczun said. And as for other fees, “they are as high as they can be,” he said. A number of fees were increased last year, he added.
   Mr. Krawczun said while he understands residents’ frustration, his $167,000 salary as municipal manager is less than his predecessor’s pay. He pointed out that he also holds the title of chief financial officer and community development director, which saves money because he does not accept the full salary the two positions would demand.
   Cindy McBride, who lives on Lawrenceville-Pennington Road, said that while Mr. Krawczun might wear three hats, there are “a lot of good, dedicated people” who also held down three jobs and who are unemployed.
   When Ms. McBride said she would “cut all of you” before laying off police officers or firefighters as a cost-cutting measure in lieu of the additional 9-cent increase — one option that was rolled out but quickly rejected by Township Council — Mr. Krawczun replied that it was only a recommendation and that he made it “explicit” that it was a recommendation.
   Mr. Puliti added that he had asked Mr. Krawczun for some alternatives to the 9-cent increase, and laying off employees was one of the options. He emphasized that he would not dismantle the Police Department or the Recreation Department, and that layoffs are not under consideration.
   ”This is the best route, which we elected to go,” Mr. Puliti said. “I don’t want to be on the Township Council that dismantled the township.”