SPOTSWOOD — A decrease in the net assessed valuation of properties, combined with rising health and pension costs, will contribute to an increase in municipal taxes for the borough in 2015.
The borough’s nearly $10 million budget for 2015 was unanimously approved at an April 8 meeting of the Borough Council.
Under the budget, annual municipal taxes will increase $49.70 for the owner of a home assessed at the borough average of $254,726, according to Mayor Nicholas Poliseno.
That brings the average municipal tax bill to $2,239, up from $2,189 last year. Municipal taxes do not include school or county taxes.
“We’re on a very slow trend [with taxes] going up,” Poliseno said. “It’s very difficult to get that trend going down unless we end up cutting services, which I don’t want to do.”
The total amount to be raised in municipal taxes is $6,492,312, which represents 65 percent of the budget.
The borough will also use surplus funds to offset the budget, pledging $1.1 million of the more than $1.5 million surplus to the budget as revenue.
The $2.8 million decrease in net assessed valuation was a big factor that led to the increase in taxes, Poliseno said.
“The net decrease being so large was a huge impact on the budget that we ended up taking on as a loss,” Poliseno said. “If there was no decrease, taxes probably would have been flat or close to it.”
The decrease in valuation is mostly due to tax appeals and a slowing of new construction, according to Business Administrator Dawn McDonald.
“It was mostly tax appeals and a decrease of new construction in town,” Mc- Donald said. “We’ve seen a little bit [of a decrease] each year, but it has been on a decline because of the economy.”
The budget absorbs more than $31,000 in rising insurance and pension costs and a $55,998 increase in debt service payments.
“We are very aggressively paying down debt,” Poliseno said.
According to the mayor, Spotswood is also hiring two new police officers, purchasing two police SUVs without taking on any additional debt, and making one parttime sanitation worker a full-time employee.
Moving forward, Poliseno said borough officials plan to look for more shared-service opportunities, pursue more grants and continue to increase services with a minimal tax impact. McDonald said the borough had been successful in that goal this year.
“As the mayor indicated … we’re actually able to increase services,” McDonald said. “That’s almost unheard of in municipalities these days.”
According to McDonald, long-term pressures are always infrastructure improvements and continuing services provided by the borough without drastically increasing taxes.