Council: Tax increase, budget to be scrutinized
BY MARLENE CANTY
Staff Writer

OLD BRIDGE - The Township Council last week held a hearing on the proposed municipal budget for fiscal year 2007, though officials still hope to cut a proposed tax hike.

The nine-member council listened as Himanshu R. Shah, the township's chief financial officer, read off details of the budget proposed by the administration. One part of the $51 million budget was of particular interest to council members and residents, Mayor Jim Phillips' proposal for a 3-cent municipal tax rate increase, the same rate that was proposed last year but cut by the council.

Councilman Robert Volkert, a member of the council's finance committee, said in an interview that he is hopeful the council will find areas to cut spending, rather than resorting to a tax hike.

The current 3-cent increase would bring the municipal tax rate from 76 to 79 cents for every $100 of a property's assessed value. That translates to about a $48 tax increase on the average homeowner for the next year.

Like last year, the mayor has applied to the state for extraordinary aid, Volkert said. That prospective $1 million in aid could make a property tax increase, and some of the other cuts in spending the council is considering far less necessary or extensive.

According to Councilman Richard Green, also a member of the finance committee, it is easy to say one will make "cuts," but these are far more problematic to institute in a growing town in need of municipal services.

When a population starts to grow, programs have to follow, Green said.

According to census statistics and township estimates from the Tax Assessor's Office, the population of Old Bridge has grown by about 15,000 over the past two decades, and the cost of goods and services has continued to steadily rise.

Shah was unable to give the specific requisites that help a town qualify for extraordinary aid from the state.

"The state decides the requirements and they vary from year to year," Shah said.

Last year, Old Bridge was turned down for the stipend, but in fiscal year 2005 the town was awarded $300,000 in aid to help reduce property taxes.

The state's process of choosing which towns to subsidize amounts to its own peculiar brand of voodoo economics.

"The financial circumstances for the town were very similar in 2006, but that year we got nothing," Shah said, noting that last year East Brunswick, Piscataway, Edison and Woodbridge, all smaller towns with less burgeoning populations, got the aid.

If that aid is not forthcoming this year, the alternative to cutting services is the mayor's 3-cent tax increase.

According to council President Patrick Gillespie, that increase, along with the budget as a whole, is still in the beginning stages of review. Before either is approved or rejected, it will come under council scrutiny and be subject to amendments made by council members. As part of that process, the council will conduct workshops to discuss those changes.

Once the group has formed a consensus, the budget and any proposed tax increase will be brought to a vote.

By that time, issues of what areas of spending will be cut or whether the council will approve the 3-cent tax increase will hopefully have been resolved.

According to Gillespie, in "bad" years a budget can go well into the fiscal year without receiving approval.

"The current budget is already three months into the fiscal year, and we still haven't voted on it yet," Gillespie said, noting that it only needs a majority to pass.

"There's nothing troubling about the current budget," Gillespie said. "... It's honest and accurate, and the town is on strong financial footing. I'm confident our policy choices are good.

"In 1992, the budget was nearly a year late," he said. "By those standards, this year we're in pretty good shape so far."