(Reprinted from Amboy Beacon, Oct. 20, 2010)
PERTH AMBOY — The municipal portion of the local property-tax bill will
remain the same until the end of 2010 as a result of the unanimous City Council
action taken last week.
Following a public hearing during which nobody in the audience chose to
speak, Councilman William Petrick moved and seconded a Resolution to adopt the
Transition Year 2010 Budget, which was adopted 5-0.
The state Department of Community Affairs (DCA) required that all municipal
spending plans be approved by governing bodies no later than Friday, Sept.
24, without an extension being granted by DCA.
The Resolution to adopt the Amendments and schedule the hearing for last
week with DCA’s approval was moved by Petrick, seconded by Gonzalez and
adopted 4-0 at the Council’s last meeting, from which Council President Kenneth
Balut was absent.
Interim Business Administrator Gregory Fehrenbach explained at that time
that the Amendments would result in “no changes to revenues except to include
numbers for grants, which are figures unavailable to us earlier.”
The overall size of the six-month TY 2010 Budget, which covers the period
from July 1 through Dec. 31, 2010, totals $39,518,509, which is $262,517
larger than half of the FY 2009-10 Budget ($39,017,575).
The amended TY 2010 Budget is $1,238,417 higher than the previously-adopted
TY 2010 Budget of $38,280,092, but the Amount To Be Raised By Taxes is
$27,607,153 over six months, exactly one-half of the Amount To Be Raised By
Taxes over one year for FY 2009-10 ($55,214,306).
Fehrenbach took slightly-longer than an hour to go-over the spending plan
in some detail at the Council’s last meeting.
“We made corrections to our estimates, adding grants that we’ve received
since our previous numbers, but the tax-levy is fixed,” he said.
Rather than simply halving line-item accounts, the TY 2010 Budget as it was
developed includes substantial increases for such things as the Reserve For
Uncollected Taxes — from $998,726 for FY 2009-10 to $2,321,906 for TY 2010
— and the Reserve For Tax Appeals — from $185,000 for FY 2009-10 to
$1,000,000 for TY 2010.
Apparently, the city is anticipating future difficulty in tax-collections
because of the sputtering national economy, even-though the Tax-Collection
Rate for FY 2009-10 was a healthy 94.8-percent.
General Liability Insurance for TY 2010 is $745,000 for six months,
compared to $735,000 for a full year in FY 2009-10, and Workers Compensation
Insurance for TY 2010 is $1,749,895 for six months, compared to $2,365,000 for a
full year in FY 2009-10.
On the other hand, Urban Enterprise Zone (UEZ) — $484,624 in FY 2009-10 —
was lowered to $15,000 in the unamended TY 2010 Budget, but now is
increased to $517,099.
Emergency Management — $102,300 for Salaries & Wages and $6,500 for Other
Expenses, or a total of $108,800, in FY 2009-10 — is zeroed-out in TY 2010.
Fehrenbach has explained that the TY 2010 Budget “is not simply a one-year
budget cut-in-half” because it reflects expenses as they are incurred during
certain times of the year.
“For example, there are no contributions to the pension system because
those payments are made in April, but most of the general liability insurance
payments are included because these are made during the last half,” he noted
at the Council’s last meeting.
A transition budget “has no policy-initiatives” and “a capital budget
that’s really of-no-consequence,” Fehrenbach said.
In these ways, he likened a transition budget to “two temporary
(three-month) budgets rolled-together.”
The big policy debates will come later, after what Fehrenbach called “a
little relief for a short time.
“We want to get this (TY 2010) Budget behind us so that we can start
working-on the Calendar Year 2011 Budget,” he said. “There will be challenges,
and it’s not going to be easy. A two-percent cap is extremely-limiting.”
In an attempt to head-off a projected financial crisis down-the-road, the
previous Council voted unanimously on May 26 to enact an Ordinance
authorizing reversion from a Fiscal Year (July 1-June 30) Budget to a Calendar Year
(Jan. 1-Dec. 31) Budget.
In reverting to Calendar Year budgeting from Fiscal Year budgeting, Perth
Amboy followed the lead of neighboring South Amboy, which was the first
municipality in the state to revert from Fiscal Year budgeting to Calendar Year
budgeting in 2009 under a new state law giving municipalities which were
mandated to change from Calendar Year budgeting to Fiscal Year budgeting — like
Perth Amboy and South Amboy — the option of going-back to Fiscal Year
budgeting.
Fehrenbach pointed out that one of the good things about reverting from
Fiscal Year budgeting to Calendar Year budgeting will mean “a single tax-bill,
instead of two, three or four.”
Also, “had the city not done-so, we would be facing an immediate shortfall
of $5.2 million, due primarily to cutbacks in state aid, including Energy
Receipts and Extraordinary Aid,” he said. “This way, the city can collect 24
months of state aid in 18 months.”
No comments:
Post a Comment