Bernards Passes Municipal Budget, 3.65% Tax Hike

As of June 29, Bernards has an official budget for 2010 with the Township Committee's unanimous passing of the municipal budget.

The new budget will raise $16,592,076 in taxes for municipal services, one component of overall property taxes for township residents, which also includes county, open space and school taxes. Township officials are quick to point out that the levy, which constitutes a 3.65 percent increase (($522,007 total) over 2009, is below the tax levy total from 2005, a feat achieved with four consecutive years of decreasing taxes since that time.

Budgetary Pressures

The reason for the increase, as presented by Township Administrator and Chief Financial Officer Bruce McArthur, is a combination of falling revenues (specifically from state aid) and increasing benefits and pension costs, among other items.

McArthur listed eight budgetary pressures, which have changed since 2005, amounting to a hole of over $6.1 million that had to be filled through finding budget efficiencies or increasing taxes.

The police budget, pensions, reserve for uncollected taxes and library spending (up on the municipal level, but also suffering from massive state aid cuts) have combined for $3.18 million of additional costs in 2010 than those items cost in 2005.

On the revenue side, state aid has fallen from $2.69 million in 2005 to just $1.8 million in 2010, and interest earnings (down from over $1 million in 2005 to a predicted $135,000 in 2010 due to the poor economy), as well as increased construction code fees and added taxes for new construction help create the $2.9 million hole in revenues.

"Our taxes are lower than they were in 2005, yet its interesting that these eight budget factors account for a $6.1 million difference," McArthur said. The township was able to fill the gaps caused by those eight pressures with cuts throughout the budget, handling the increase with lower tax revenues from the previous year.

Public Comments

Several Township Committee members expressed gratitude to the staff responsible for creating the budget, saying that they were pleased with the result.

"I would like to express my thanks to our staff," Township Committee member John Carpenter said. "The watchword since the moment I stepped on the dais has been fiscal responsibility. I think that's something we all agree on."

"We included in our budget things that we need to have, and we put off for a time things that are nice to have," Mayor Scott Spitzer said. "This budget represents significant cuts from appropriations that were requested by staff, but we've done what we feel is needed to do right by the residents of our township."

"We haven't cut corners in order to make ends meet, but the reality is that we do have (budgetary pressures)," Spitzer said. "I think we've come up with a budget that is reasonable for out township."

Three residents spoke in the public hearing on the budget, with opinions split. John Crane of Decker Street was in favor of the proposal. "I'm very impressed with Bruce's work and Denise (Szabo, Township Clerk)," he said. "It pays to have local residents working on our budgets."

Paul Damurjian of Douglas Road voiced opposition to the budget due to current economic conditions. "I'm not happy with the fact that our taxes are being raised at a time when people are out of work," he said. "There are a lot of statistics here about 2005 and 2010, and I guess what I wanted to say is it doesn't matter what happened in the past. I'd like to see a little more diligence on the part of the Township Committee and the Township Administrator to do what we can to keep our taxes down."

State Aid Challenges

In the board comment section of the meeting, Deputy Mayor John Malay mentioned the issue that presented challenges in this year's school budget process – heavy state aid reduction.

Bernards will receive $63.42 per capita in state aid for 2010, an amount that is obtained exclusively through receipts for state taxes on local energy utilities, according to McArthur. The per capita amount has decreased over 35 percent since 2000 when Bernards received $97.83 in state aid per capita. As with state aid for school funding, Bernards receives well below the statewide average for aid, currently at $150.09 per capita. Bernards is also significantly behind the rest of Somerset County, which averages $104.43 per capita in 2010.

"Certainly no one wants to see taxes go up, and we've succeeded in the past few years from preventing that from happening. But I would emphasize the extent to which legislation in Trenton has had an adverse effect on our town," Malay said.  "Despite that malfeasance on the part of the state, Bruce has managed to keep our taxes in check. There's a certain magic too it, I'm not quite sure how he does it."