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Council Introduces 2007 Budget And Proposed 6.3-Cent Tax Rate Hike
By Keith Hagarty
The public got their first look at the 2007 municipal operating budget last week, which calls for a 6.3-cent tax rate increase.
The $28.9 million budget, which reflects the township's fiscal year from July 1, 2006 to June 30, 2007, is up by approximately $2.6 million from last year's budget, or about a 10 percent increase.
The proposed 6.3-cents tax rate increase would raise the overall municipal tax rate to 69 cents per $100 of assessed property valuation. The tax hike means that a homeowner with a property assessed at $150,000 would pay $1,035 per year in municipal taxes, an increase of $94.50.
The overall property tax bill is made up of municipal property taxes (usually about 25-30 percent of the total bill), county taxes, and school taxes (roughly 50-55 percent of the tax bill).
There are several factors that contributed to the proposed tax increase, according to William J. Garofalo, the township's chief financial officer and director of finance, who introduced the budget to the township council.
"There were a lot of things that
were beyond our control," Garofalo
told The Manchester Times. "One of the main things that drove the budget up was the increase in pension costs, our township obligation to the state pension fund, increases in employee benefits and the increases in gasoline, which have driven up the costs of all materials across the board."
Pension cots rose by approximately $400,000, debt service up by $500,000 and health benefits went up by $400,000, said Garofalo.
"It was very tough because we have a very tight cap restriction of three-and-a-half percent imposed by the state and yet the state increases the pension by 40 percent," he said. "Medical benefits also historically go up anywhere between eight and 15 percent, and we have salary obligations and contracts, many of which are higher than three percent, and it's very hard. It's getting, very, very hard."
Despite the larger budget and proposed tax increase, there are no expanded services or programs planned.
"We just didn't have the room," said Garofalo. "We didn't feel that this would be the time to expand things and impose even more of a hardship on our taxpayers."
Garofola is disappointed in what the township has seen coming from Trenton for a half-decade now.
"It is as flat as can be," he said of the state aid for municipalities. "By being flat every year, it's actually a decrease because there's inflation, and this is now five years in a row where state aid has been at the same level as it was five years ago."
With no indication of state aid increasing in the foreseeable future, Garofalo said the predicament is unfortunately something every municipality in New Jersey will have to adjust to and deal with the best way they can.
This year's proposed tax hike comes on the heels of last year's 3.5-cents tax rate increase to the budget. Proposing any tax increase is never an easy proposition, according to Garofalo. "We take it very seriously and we use every bit of cash surplus we have to keep taxes as low as possible," he said. "We go out and try to find all different kinds of revenue. This year we had a bid for municipal properties, little odd lots all throughout the town. We sold a million dollars worth of properties to help keep taxes as low as possible. We work hard on it."
Garofalo credited everyone involved who spent long tireless hours working on the proposed budget trying to keep the tax impact as minimal as possible without sacrificing services.
"The mayor works very hard in developing the budget," he said. "The council, the mayor, the business administrator, all of the department heads and the council's finance committee-which is Ken Vanderziel and Fred Trutkoff-have all worked very hard in putting this budget together."
Pending state review of the proposed budget, a public hearing has been scheduled for the council meeting on October 10. Garofalo said he would be attending the meeting.
Copies of the budget are available to the public at the township clerk's office in the municipal building on Colonial Drive, the Manchester Public Library and on the township's website: www.manchestertownshipnj. org.
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