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Posted: Fri, Feb 18 2011, 2:35 pm EST Post subject: CRANBURY: Budget would raise tax rate by 2 cents |
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http://www.centraljersey.com/articles/2011/02/18/cranbury_press/news/doc4d5d71191093b270936607.txt
CRANBURY — The township will introduce its budget for 2011 on Feb. 28, and the Township Committee discussed it one last time Tuesday as it reluctantly plans to raise the tax rate 2 cents this year.
Last year’s budget was $10,788,106, and this year’s budget is proposed at $10,344,537.
Of that, $641,843 will be for administration and executive costs; $641,290 will be for professionals and boards; $2,450,292 will be for public safety; $672,016 will be for Public Works; $750,342 for statutory expenditures; $790,850 for utilities; $811,399 for insurance; $572,604 for the library; $965,395 for interlocal agreements; $1,642,707 for debt service; $149,426 for the reserve for uncollected taxes; and $256,373 for other expenses.
The amount to be raised by taxation is not yet known because the township does not yet know if it will receive state aid. Last year’s amount to be raised by taxation was $6,365,360.
Last year, the tax rate was 37.5 cents per $100 of assessed value. At the meeting Tuesday, the committee spoke of raising taxes 2 cents to 39.5 cents per $100 of assessed value.
This year, an owner of a property assessed at the average of $608,299 would pay $2,403 in property taxes with a 39.5-cent tax rate. Last year, an owner of a property assessed at the average of $617,439 paid $2,315 with the tax rate at 37.5 cents.
The township expects to approve the budget before knowing if it will receive state aid. Last year’s state aid was $467,020.
Mayor Win Cody said if the township does receive state aid, he expects it to be around $320,000. If the township does receive state aid, however, the committee said it would like to put it in surplus instead of lowering taxes. With this year’s budget, the township will have $3 million in surplus.
”My concern is we’re using more surplus,” Committeeman David Cook said. “We should try to reduce the use of surplus.”
”We need to make sure we have a healthy amount of surplus set aside so we don’t have to go to referendum,” Township Administrator Denise Marabello said.
If the township places a referendum on the ballot, it may be to ask voters whether to cut positions such as police officers or Public Works employees, Committeeman Dan Mulligan said.
But the township is not in horrible shape, the committee said.
”Surplus is something very few towns in New Jersey have,” Mr. Mulligan said. “As we look at our township, we’re in good financial position.”
”Relative to everyone else, we’re in good shape,” Mayor Cody said. “We’re not in terrible shape.”
He said he believed the township can take more from the surplus before raising taxes since there’s a good chance things will get better in the future.
”We can make it. We’re still well above what the surplus should be,” he said. “I hate to raise taxes on people in this economy.”
But Ms. Marabello was concerned that if the township doesn’t raise taxes 2 cents this year, it will wind up having to raise taxes 3 or 4 cents a few years down the road.
”I don’t want to budget now for fear of three years down the road,” Committeeman Jay Taylor said. “At the same time, I don’t want a budget that paints a rosy picture in three years.”
”The future doesn’t look bleak,” Mayor Cody responded.
”I didn’t want to join the committee to raise taxes,” Mr. Mulligan said. “But we just don’t have a lot of fat in the budget.”
”We’ve trimmed expenses to make sure there’s no excess,” Mayor Cody said.
To cut expenses, the township consolidated the business administrator and chief financial officer positions. Both positions are now held by Ms. Marabello, saving the township about $94,000 in salaries.
Previously, Ms. Marabello was jut chief financial officer and took former Township Administrator Christine Smeltzer’s position when Ms. Smeltzer retired in November.
The township also promoted Chief Rickey Varga to take the place of Ed Kahler, the former chief, and didn’t place a new officer in Chief Varga’s former position.
”We would have hired an entry level officer to increase their head count,” Ms. Marabello said.
Not hiring a new officer saved the township $45,000, the entry level salary for a police officer.
”Let’s say things do get better,” Mr. Cook said. “I don’t think a tax cut is out of the question.”
The budget can be amended after it is introduced, and the township can wait until it sees if it gets state aid this year before passing the budget, but waiting that long to pass a budget is “frowned upon,” Ms. Marabello said.
She added this would be the first committee in Cranbury to do that. Cranbury won’t find out whether it’s getting state aid until late March.
”My thinking is you need to be comfortable with the tax rate, state aid or no state aid,” Ms. Marabello said.
The committee agreed that if it knew it would be getting state aid, it would be comfortable raising taxes just 1 cent instead of 2.
By the end of the meeting Tuesday, though, the committee agreed that if the town does get state aid, it would like to put it toward surplus. |
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Posted: Fri, Feb 18 2011, 5:54 pm EST Post subject: Re: CRANBURY: Budget would raise tax rate by 2 cents |
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More from East Windsor Patch with some further details.
At Tuesday’s final budget meeting, the Cranbury Township Committee decided that Feb. 28’s budget introduction would include a two-cent tax increase. This decision was not unanimously agreed upon, but four of the five committeemen said that an increase was necessary in order to avoid depleting the township’s surplus money.
Based on Cranbury’s average household value of $608,299, a two-cent tax increase would see residents paying an average of $87 more in municipal taxes than last year.
Cranbury’s surplus currently stands at around $5 million. If state aid remains flat and taxes aren’t raised, the present rate at which the township is using its surplus would result in its exhaustion in approximately four or five years. Township Administrator Denise Marabello informed the committee that maintaining a steady surplus level is important going forward.
“We need to be sure we have a healthy amount of surplus set aside so that we don’t have to go to referendum to raise taxes,” she said. A total depletion of the township’s surplus would force Cranbury to participate in a public vote, which would either raise taxes instantly above the state-mandated cap or else force a near-instant cut in services. The mere act of going to a referendum would negatively effect the township’s bond rating.
Republican Mayor Winthrop Cody was the only member of the committee who said he felt that taxes shouldn’t be raised under any circumstances this year.
“In three years if things are really bad, we may [need to raise taxes]. I hate to raise taxes on people in this economy,” the mayor said before yielding to his colleagues. Cody went on to say that raising taxes now was assuming the economy would continue to get worse, which is something he wasn’t comfortable doing. As a point of reference, Marabello explained that Cranbury’s final assessed value was just announced as about $1.6 billion, which is a decline of $95 million. Marabello’s stated that this figure might remain steady over the next few years, but it’s unrealistic to expect it to increase.
Committeeman Jay Taylor, also a Republican, said he was for the two-cent raise, but only if Cranbury’s state aid total was considerably less than last year’s $1.1 million. If the aid doesn’t drop, Taylor said he would only support an increase one-cent or less.
More can be read- http://eastwindsor.patch.com/articles/cranbury-to-introduce-two-cent-tax-increase |
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