With a far less than expected award from the state in the form of extraordinary aid this summer, the mayor and council were forced to adopt an amended municipal budget last week constituting a seven percent increase on the average assessed homeowner’s municipal taxes. The hike according to officials is due to in part to a lack of response from the state in compensating the town for the loss of the 500-plus acre Empire Tract that had supplied nearly $2 million each year in tax revenue.
This year, an individual owning the average assessed home of $200,000 will pay an additional $180 in municipal taxes, thereby making a total average municipal tax bill $2,738. That amount is down slightly from when the council introduced its budget early in the spring when the tax hike constituted a 7.6 percent or $195 rise on the municipal portion of the tax bill. The total budget amounts to $17.86 million while the amount needed to be raised by taxes is $13.47 million. Those figures are up from last year’s budget of $16.89 million and tax levy of $12.58 million.
According to officials, however, they once again lobbied to Trenton this year for an enormous chunk of the state’s extraordinary aid pool with a request of $2 million, but like many municipalities, only received a portion of the total amount request. This year, the state only granted the borough $350,000 in aid, while last year the state was far more generous responding to the same request granting the borough a windfall in $700,000.
"We again went down and had meetings with staff at the governor’s office and basically assumed that last year when they awarded us $700,000 that they conceded they made a mistake by taking away that revenue without reimbursement to us. We thought that they would look for more this year and maybe get us a million," said Councilman Joe Crifasi, who also acts as the council’s finance chairman. "Now when this year rolled around, it’s like we’re basically going backwards."
Carlstadt lost the $1.9 million tax revenue from the Empire Tract nearly two and a half years ago when the owners of the land, Mills Corp., exited the property to develop Meadowlands Xanadu across Route 120 on New Jersey Sports and Exposition Authority (NJSEA) property. As part of the move, the land was turned over to the Meadowlands Conservation Trust for preservation and renamed the Richard P. Kane Natural Area. The land became tax exempt.
"It’s not a big pool of money, but the state really needs to look at who needs it most," said Crifasi. "It has to be an extreme condition and what’s beyond the control of the mayor and council of that town and that is the case here. It was the doing of higher governmental agencies."
On top of having to deal with the 20 percent loss of total town tax revenue Empire Tract provided annually, this year, employee benefits showed the largest increase. The borough’s contributions to The Public Employees Retirement System was raised by nearly $50,000 and the Police and Fireman’s Retirement System skyrocketed by $175,000.
The borough did, however, put a temporary freeze on new hires rather than look to cuts to balance the budget. It even meant holding off on a new hire in the police department to replace an official who retired last year.
Two other initiatives in place from years past are now proving fruitful as money saving instruments.
Six years ago, the borough opted out of continuing to insure borough employees through the state’s employee benefit plan and went self insured. At the time, they were paying nearly $3.2 million in insurance contributions a year. Since, the borough has held a $2 million cash fund for medical needs which are paid out up front. Each year since, the account has never been fully utilized.
In addition, the borough restructured the police department two years ago after the retirement of a chief, deputy chief and two captains. The borough made promotions from within at significantly lower contract agreements. The move is to save an estimated $700,000 within six years. This year, the salaries and wages for the department are anticipated to be $3.6 million while last year the salaries amounted to $3.65 million.
"I’m a taxpayer with kids and with a seven percent increase coming, it’s coming out of my check as well. We know nobody wants an increase, but some of these things are out of our control," said Crifasi. "Whatever is in that budget, we are spending the money where people in town are reaping the services."
Altogether, the average homeowner in Carlstadt will wind up paying a total 2007 tax bill of $6,580 when school and county figures are lumped in with the municipal figure. Last year’s total bill was $6,117.
