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Council Unanimously Approves Budget, 6.3-Cent Tax Rate Hike
By Keith Hagarty
Following its introduction in September, the township council finally made it official, voting 5 to 0 at their November 27 meeting to adopt the 2007 municipal budget and its 6.3-cent municipal tax rate increase.
The $28.9 million budget is about $2.6 million more than last year’s budget, an increase of just under 10 percent. The 6.3-cent tax rate increase per $100 of assessed property valuation raises the overall municipal tax rate to 69 cents. The tax hike means that a homeowner with a property assessed at $150,000 will now pay a total of $1,035 per year in municipal property taxes, an increase of $94.50 annually.
Even though the budget was initially introduced back in September with public hearings following shortly thereafter, the council had to wait longer to officially adopt the budget, said William Garofalo, the township’s chief financial officer and director of finances.
“We were waiting actually for (state) legislation to pass to amend the cap law, but that never happened and that’s why it took us so long to finally approve the budget,” said Garofalo.
“When it became evident that that legislation was not going to be forthcoming,” he continued, “we did amend the budget to comply with the cap law as it is, and to do that we needed to cut the budget, which we did by approximately $148,000, which took the budget as introduced and lowered the tax rate by about two-thirds of a penny.”
With the 2007 budget reflecting the township’s fiscal year from July 1, 2006 to June 30, 2007, adopting the amended budget at such a late date actually made the recommended cuts a little easier for Garofalo.
“Because it took us so long to pass the budget,
we were actually already five months into it, so we could see some things could be cut without harming anything,” he said.
Several factors contributed to the tax rate increase.
“There were a lot of things that were beyond our control,” Garofalo said. “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, all of which have driven up the costs of all materials across the board.”
The township’s pension costs rose by approximately $400,000, debt service up by $500,000 and health benefits went up by $400,000.
While any tax rate increase is cause for concern, Garofalo is glad to see one of the benefits of this year’s budget.
“The best thing is we were finally able to find a way to increase the size of our police force,” said Garofalo. “We’re a growing community and we were able to bring on two new patrolmen. I was very happy about that.”
The cost of hiring the two new patrolmen with their combined salary and benefits comes to about $100,000.
Having worked on Manchester’s municipal budgets in various capacities over the last 16 years, Garofalo believes outside circumstances have not only put Manchester’s financial planning in a bind, but have also shackled the hands of municipalities throughout New Jersey.
“Because of budget restrictions imposed by the state, and because of this being the sixth year in a row of no increase in aid from the state, and because of our understanding of the type of community that this is, and the hardships that property taxes impose—with those three factors, it gets harder and harder to make a budget each year and to meet services while trying to keep property taxes as low as possible,” he said. “We understand our community, and there’s a hardship on a lot of people.”
With the new year rapidly approaching, the town’s administration is optimistic the state will finally address the concerns and needs of the taxpayers and the under-funded municipalities.
“I’m very interested in what’s going on in the state level,” he said. “I think there’s some very good ideas, and I think there’s some radical ideas, and hopefully they’ll find some good middle ground and make some progress on property tax reform.”
Creating and adopting the municipal budget has traditionally been a group effort amongst the town’s officials, administration and governing body, and this year has been no exception, according to Garofalo.
“The council and the mayor work very well together,” he said. “The mayor has been an integral part of putting the budget together. He works on it very diligently, as does the council’s finance committee and the business administrator. They all work on it very hard.”
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