Can you spare 58 cents?

Council intros $46M budget; includes small tax increase

Proposing one of the smallest tax increases in years – thanks in part to a new state property tax cap – the Secaucus Town Council formally introduced a $46.3 million municipal budget for 2011 Tuesday night.
A public hearing and final vote are scheduled for next month.
While the budget had to account for contractually required wage increases and hikes in health care and pension costs for municipal workers, it still came in nearly $600,000 under the state’s new 2 percent property tax cap.
If the council adopts the budget as currently proposed, municipal property taxes will increase by 58 cents for every $1,000 of assessed property owned. Since the average Secaucus home is assessed at $165,000, according to Town Administrator David Drumeler, the typical homeowner will see a municipal property tax increase of about $94 annually, or less than $24 per quarter.
In 2010, municipal property taxes went up 55 cents, for every $1,000 of property owned, and increased $1.14 in 2009.

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Like all public entities, Secaucus is struggling with increases in health care premiums and pension benefits costs.
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Secaucus uses the calendar year as its fiscal year and is currently still operating under last year’s budget. The 2010 municipal spending plan has been amended several times since January.
The proposed 58-cent increase applies only to the municipal property tax rate. Property owners pay a combined tax bill that also includes taxes for the county and local public school district. Tax increases and cuts proposed by those other entities will also affect a property owner’s overall tax bill.
The Secaucus Board of Education introduced a $33.1 million budget for the 2011-2012 school year earlier this month and was scheduled to hold a public hearing on Thursday, March 24. The public will have an opportunity to approve or reject that spending plan during the Board of Education election next month.

Will keep cutting

Town Councilman Robert Costantino, chair of the governing body’s Finance Committee, said the council will try to trim the budget over the next month to further reduce the 58-cent increase.
“Tonight we introduced the 2011 budget, which now allows us as the governing body to roll up our sleeves and get to work on reviewing the numbers and coming up with a final budget, which we plan to adopt on April 26,” said Costantino on Tuesday. “We’re going to work hard over the next couple of weeks to get that tax rate even lower.”
The 2010 budget of $45.2 million initially included a 66-cent tax increase that was eventually cut to 55 cents.
Prior to voting on the 2011 municipal budget the council will hold a public hearing on Tuesday, April 26 at 7 p.m. at Town Hall.

Rising expenses offset by corporate taxes

Like all municipalities and other public entities, Secaucus is struggling with substantial increases in health care premiums and pension benefits costs for its workers.
“Some of the major increases include an increase of $396,000 for health insurance premiums and an increase of $1.1 million in pension [obligations],” Costantino said.
In addition, he said the town was contractually obligated to increase wages this year by a total of $585,000 for workers covered by collective bargaining agreements.
Seven municipal unions have contracts with the town that expire on Dec. 31, 2011. This fall, the town will begin labor negotiations with an eye towards keeping these expenses down in future budgets.
These increases have been partially offset by healthy increases in corporate taxes from local hotels and parking fees.
Last year, Secaucus received $504,419 in taxes from the Edison-owned parking lot at the Frank R. Lautenberg Rail Station, and is on track to get an added $100,000 in 2011 over 2010.
The town also receives a 3 percent tax on every hotel room booked in Secaucus. Last year the hotel tax generated $1.7 million total, a figure the town expects to top by another $110,000 this year.
State aid to the municipality has remained consistent.
Under Gov. Christopher Christie’s spending plan Secaucus will receive $1.8 million in state aid in New Jersey’s next fiscal year, which begins July 1. This is the same level of funding the town received in the current fiscal year.
The state operates under a fiscal year budget that runs from July 1 until June 30.
The town’s Emergency Medical Services budget will drop by at least $500,000 annually beginning this year now that Meadowlands Hospital Medical Center will underwrite the costs of ambulance service in Secaucus.
About $50,000 in expenses have been cut at the Secaucus Recreation Center, Costantino said, giving the town an additional cost savings.

$600K under the cap

The 2011 budget is the first to be introduced in town under New Jersey’s 2 percent local property tax cap, which the governor signed into law last year and which took effect recently. The law, which caps annual municipal tax increases at 2 percent, was backed by Christie to stem rising property taxes.
Although some municipalities are concerned about how they will comply with the new law, Secaucus has put together a budget that is actually about $600,000 under the required cap. Costantino and Drumeler said the town will be able to remain under the cap without cutting municipal services for residents.
“The mayor and council have engaged in a course of fiscal responsibility and I think that shows through us being $600,000 beneath the governor’s mandated 2 percent cap,” Drumeler said Wednesday. “Other towns around us are in the unfortunate position of having to take more dire measures, like service cuts or layoffs.”
The 2 percent property tax cap law includes several budget items that are exempt from the cap, including health care costs and pension spending, costs that are growing at double-digit rates.
E-mail E. Assata Wright at awright@hudsonreporter.com.

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