MANCHESTER – Township officials unanimously voted to adopt its 2020 municipal budget recently. Taxpayers on average will see a $38 tax increase in the municipal portion of their tax bill.
“It is not a monumental tax raise but it is an increase from what we have seen in the last four years. The prior average home value prior to the tax assessment was $166,000 now the average home in the township is $198,000,” Mayor Kenneth Palmer said.
Mayor Palmer followed up presented a full breakdown of this year’s spending plan with a PowerPoint presentation. He had given an overview during a meeting last month.
The mayor said this year’s approximately $37 million budget went up by around $1.3 million from 2019 and there were three factors that caused that increase.
The first was the township’s new emergency medical service which started in March and represented a $1,050,000 increase by way of salary and operating expenses. “We hired 22 new full-time employees to the tune of $900,000,” Palmer said.
“This year we will generate more than $900,000 in revenue from the EMS. We expect next year to have additional revenues which will offset some of the new line items we had this year,” the mayor said.
Palmer also spoke about accumulated leave. With recent police negotiations, within the next three to six years, a number of “rank and file police officers as well as our sergeants up – a large chunk of those employees will be retired. Along with them they get 183 days-worth of pay in what it is called terminal pay.”
Terminal pay was negotiated into their contracts years ago and is basically unused sick time that the officers accumulated. “It is going to cost the township a significant amount of dollars when they retire,” Palmer said. He added, the township was beginning to save for that situation.
“This year we are putting $250,000 aside and each of the coming years we hope to do the same if not more. It is three to four million dollars-worth of time that will be paid out. We have to start putting money toward those payments,” the mayor said.
Palmer said a land sale that occurred in 2019 for a county park provided the township $1.4 million. “We don’t have that next year so that is a hit to our general operating revenue that we can’t count on.”
The township’s capital fund last year went down to $150,000. “We had some unspent reserve money for that but this year, we dropped it down $75,000,” the mayor added. COVID related expenses were a new item in the budget. “Since we are doing the budget so late, we are able to add that into the budget. That is about $322,000.”
Palmer noted previously that the township will not be “getting to some of the paving and some of the capital improvements that we typically do.”
The local tax levy is $21,902,071 which is an increase of $1,174,334 from last year. The reduction in the municipal rate went from .623 in 2019 and .5225 this year. The 2019-year end surplus was $6.9 million. The surplus used towards budget is $4 million.
Major expenses included $466,000 for professionals in 2020 which is up from $456,000 in 2019. Debt service went down in 2020 to $1,981,794 from $1,991,957 last year.
Social Security expenses went from $1,325,000 this year from $1,450,000 in 2019.
Palmer’s presentation also showed the township’s levy cap bank rainy day fund had totaled at $3.114 million.
In the township’s east and west utilities account the eastern side sewer total budget was $4,330,000 marking an increase of $5,000. The eastern side water had a total budget $2,600,000. Last year it had $2,550,000. Capital improvements are $150,000 which includes radium treatment and test wells. Future projects include an elevated water tower which is in progress and an interconnect with Lakehurst.
The western side for water has a total budget of $2,800,000 which has a flat budget. The western side sewer has a total budget of $2,535,000 with a decreased budget of $127,000.
This year’s tax rate has a breakdown that includes the municipal portion as 24% of the bill, school taxes being the largest portion at 56% and county tax being about 20%.
“Most of the budget really stayed the same from the previous year outside those three issues I mentioned,” the mayor said. “Salaries are about 45% of the budget. It went up by one percent.”
“Debt stayed the same, operating expenses stayed the same and our insurance went down since we made the switch from a group plan to a private carrier to the state health plan,” Palmer said adding that township employees contribute more than they did previously.