Tax increase approved in municipal budget Council votes 7-2 on spending package with average $45 hike BY MICHAEL ACKER Staff Writer Old B OLD BRIDGE — Residents will pay an average of $45 more for municipal taxes for fiscal year 2007. The Township Council, divided along party lines, adopted a $51 million municipal budget on Monday that includes a nearly 3-cent increase in the municipal tax rate, which is only one portion of a homeowner’s property tax bill. That bill also includes school, county, open space and fire district tax rates. The tax hike comes after the township was denied state aid for the second consecutive year. Township Chief Financial Officer Himanshu R. Shah told the Suburban that the budget actually calls for a 2.6-cent tax increase, but the county will round it up to the nearest full cent. The rate will rise from 76 to 79 cents for each $100 of assessed value. The council faced a combination of increased costs and lost revenue with this budget, Shah said. “We had to cover some of the increases from the state — revenues and some grants,” Shah said. “We didn’t get any state aid. That is one of the reasons why we had to get an increase.” Mayor Jim Phillips conducted a detailed review of the budget with all of the department heads before turning it over to the council, Shah said. “[The council] found that it was sound, conservative, and there is not much room to cut in order to provide services to the taxpayer,” Shah said. The cost increases can be attributed to three areas, he said: pension costs, which rose $670,000; utilities, which went up approximately $200,000, or 10 percent; and health insurance costs, which rose by $100,000. “All three account for the increase,” Shah said. “They did reduce their EDC [Economic Development Corporation] contribution by half, because the EDC has not hired an employee yet [to replace former Executive Director Russell Azzarello].” The township also reduced staff positions through attrition, Shah said, adding that the council chose to restore two of the positions, one in public works and another in the parks department. The township will apply for state aid again for the 2008 budget, and Shah hopes the state recognizes that Old Bridge is a growing community that is in need of state assistance to defray tax increases. “We were surprised when they chose to give aid to Piscataway, Edison, Woodbridge and South Amboy, yet they didn’t get any to Old Bridge. We do not understand their rationale,” Shah said. Those four towns have more ratables and more surplus balances than Old Bridge, he said, adding that the council went with the tax increase only after learning of the lack of state aid. “From the council’s perspective, there is not much to offer in terms of adjustment,” Shah said. “The administration has done a good job in containing the costs. It is beyond the control of the township in this environment of high costs.” Phillips said this year’s hike was unavoidable, but he hopes to keep the tax rate stable next year, as he did in 2004, his first year in office. “Next year, I hope to have a zero increase again,” Phillips said. “As long you can explain to people the reasoning behind it, it is not like we did anything extravagant.” The vote on the budget was 7-2, with the Democrats in favor and the council’s two Republicans opposed. However, Phillips said that no motion was made to reduce the budget. “No council person made suggestions or a motion to reduce the budget,” Phillips said. “There was no attempt to even try to adjust the budget.” While the township increased the police department by five officers, Phillips said the other departments were cut back through attrition in order to save money on salaries and benefits. “The thing that I would like to stress is that we maintained a level of service, increased the number of employees, and increased the emphasis on public safety,” Phillips said. Republican Councilman Richard Greene told the Suburban that he voted against the budget, in part because he does not think the township should sell municipally owned property to avoid a greater tax increase. “My overall concern is that [Phillips] campaigned on a platform of tax relief … . I disagree with the direction that he is going with his way of providing tax relief through the selling of property. You get the revenue this year, but you are going to have to make that up next year,” he said. Though the properties that the township has sold over the past two years are small, one of them has since had a house built on it, Greene said. If just one child resides at that house, the district will have to spend $8,000 to $10,000 a year for education costs, he said. “It is unfortunate that we are giving [land] away,” Greene said, “and in [that] one case, the idea backfired.” Greene, who is on the council’s finance committee, said the budget is not structured properly. “My concern with the budget is that [Phillips] has put in some one-shot items in order to minimize the increase from year to year. He is selling land that the township owns. Granted, they are small properties, but ultimately the budget is not structured properly. While Greene said he would have preferred that the finance committee had met more often in recent months, he added that the budget benefited from having a committee work on it. “I am glad that [Phillips] did put the committee together and I hope that he continues to make sure that becomes an ongoing review process,” Greene said. “I understand that the township is working under financial constraints.” ridge