BY JANE MEGGITT
Staff Writer
JERRY WOLKOWITZ staff A Smarty Jones congratulatory note hangs from a sign at the New Jersey Equine Clinic in Millstone. The 3-year-old colt was rehabilitated at the clinic after a serious injury last summer. He won the Kentucky Derby and the Preakness this spring.
MILLSTONE — Township officials spent much of the time during the budget discussion at the May 19 committee meeting arguing with each other.
When it was all over, committee members voted 4-1 to adopt the $6.4 million budget, which will raise the municipal purposes tax rate to 7 cents for each $1000 of assessed valuation.
The tax rate is still the lowest in the county, said Committeeman Chet Halka. Upper Freehold has the next lowest rate, with 20 cents (for each $1,000 of assessed valuation), he said.
Mayor Nancy A. Grbelja, Deputy Mayor Elias Abilheira and Committeeman John Pfefferkorn debated the debt figures in the budget.
Both Pfefferkorn and Abilheira have written recent columns in the Examiner supporting their figures.
Pfefferkorn claimed the year-end annual total debt is $31.1 million, which includes school debt of $14.3 million, open space debt of $7 million and general municipal debt of $9.7 million.
Abilheira wrote that the school debt should not have been included, since it is separate from the municipal budget and must be approved by voters, not the Township Committee.
Abilheira also disagreed with Pfefferkorn’s statement that the township was paying off only $247,000 in debt and increasing spending by 19 percent.
Abilheira said that under his and Grbelja’s plan, municipal debt will be paid down by $3 million to $4 million.
And the $627,279 increase in spending over 2003 cited by Pfefferkorn was incorrect, according to Abilheira.
"You have to stop lying, Elias," Pfefferkorn said. "I read your article and it was pure fiction."
Auditor William Antonides said the budget document reflected what was on the books when they were closed on Dec. 31, 2003.
Abilheira said Pfefferkorn excluded from the 2003 budget $100,000 of 2003 expenses that were paid in 2004.
"You’ve taken the highest number possible and compared it to the lowest number possible, and artificially deflated it," stated Abilheira.
Pfefferkorn told him to "take an Accounting 101 course."
"It’s not what was paid, it’s the accrual," Pfefferkorn said.
Antonides said he did not personally examine the encumbrances and did not know if payments made in 2004 were listed in 2003.
Abilheira said he was "willing to bet" when the audit was done for 2004 that the budget would not exceed the 2003 numbers by $627,000.
"It will be much less," he said.
"How much ‘smoke and mirrors’ is in the budget?" Pfefferkorn replied.
He said he wanted to cut an additional $300,000 from the budget.
"It doesn’t matter from what," Pfefferkorn stated.
Grbelja said a great deal of time had been spent going through the budget "line by line."
The township will be using more shared services and other options that will save money, Abilheira said.
"In 2004, we hope to pay off $3 million in debt, the bulk of which is grant money owed to the township," he said.
"Open Space [Committee] has really jumped in with both feet working with this," Abilheira said. "There’s a little less than $8 million that the debt increased, with the Waters property and Wagner Farm Park. That was the reason we saw a significant increase in debt."
Grbelja said some bond ordinances were approved in the past, but never used.
"We had to make adjustments," she said. "We went back over the figures and took time to see what was allocated, what was used, and not used. You see revision in the debt statement because we took the time to do it."Reviewing the ordinances was a "tedious task," the mayor said.
According to Abilheira, the numbers Pfefferkorn was presenting as debt-authorized were not debt-issued.
"The township never owed $16.7 million," he said. "Do you understand the numbers we’re using? That amount of debt has not and will not be issued. The bonds for COAH [Council on Affordable Housing] have never been issued. You’re including it in the debt."
The township is making better deals with different banks to earn higher interest, Grbelja said.
"What happened last year and where is our money performing right now?" asked Pfefferkorn. "The money stayed in PNC with the exception of $2 million in First Washington Bank that was underperforming. It’s the CFO’s responsibility under state law to manage money."
The township is getting competitive bids from banks for the first time this year, Abilheira said.
The escrow accounts had been underperforming the sweep accounts. Proper cash management could give the township an additional $250,000, he added.
Pfefferkorn said the chief financial officer (CFO) handles the money, not the Township Committee.
Resident Robert Kinsey compared the unissued debt to a home-equity line of credit.
"I’m trying to understand what we actually are paying money on today," Kinsey said. "What are we paying in debt service? The public wants to know. Does anyone know what our debt is? We’re setting the tax rate here."
Abilheira said that some of the township’s debt has grant money coming to offset it, such as a $333,000 grant for renovation of the Clarksburg School in Millstone.
Kinsey addressed Pfefferkorn, saying, "What scares me [is that] you said get rid of $300,000 just like that," Kinsey told Pfefferkorn "You have to have some idea of what you want to cut. If there truly are areas that can be cut down, put it on the table so we can know," Kinsey said to Pfefferkorn.
Officials are "trying to bring Millstone Township up to the 21st century," Grbelja said.
"We have to make sure the municipal building and its employees function at a level that services our residents," she stated. "With snow plowing, we need an additional vehicle. We have a plan for that. We took a look at our roads and have a road plan in place."
Pfefferkorn continued to insist there was "fluff" in the budget.
Grbelja asked if he were going to put a motion on the floor to raise the tax rate to 15 cents.
"You made a statement that the tax rate should be 15 cents," she said. "I don’t hear that motion."
Committeeman William Nurko said that for the past four years, the budget numbers have been very confusing.
"Sooner or later, we’ve got to pay the piper," Nurko said. "We’ve got to get expenses down. We have to service residents, but we have to get the tax rate back to a realistic number. We’ve got to get the surplus down to a reasonable number and the tax rates to a realistic number. I think we’re moving in the right direction."
There is nothing in the budget to pay down principal, Halka said.
"I don’t know where we can save $300,000, unless it doesn’t snow," he said.