Amended Municipal Budget Adopted, Layoffs to Happen
Lawrence Township needs to make additional expenditure cuts – including possibly more layoffs – prior to the start of 2013 or find ways to regenerate surplus at a greater rate than has been anticipated for the remainder of this year.
Lawrence Township’s amended 2012 municipal budget – containing cuts that will now result in layoffs to police officers and other municipal employees – was unanimously approved by Lawrence Township Council during a special meeting held last night (Wednesday, May 23).
A total of 13 municipal positions – including five in the police department – will be eliminated because of the cuts, while a 14th position will be reduced from full-time to part-time.
The municipal budget had to be amended because voters on April 17 rejected a referendum that had sought permission for the township to raise the municipal tax rate 9 cents above the state’s 2 percent tax levy cap.
“One of the frustrations with the 2 percent cap is if you have an inefficient municipality and you have a lot of waste and you have a lot of folks sitting around doing nothing, it’s easy to meet the 2 percent cap – get rid of the dead weight. But if you’re running a government in an efficient manner, there’s no fat to remove – you’re cutting into bone,” Councilman Michael Powers said. “And that’s what you’re seeing tonight. You’re seeing the council being responsive to the voters and making the cuts that the voters have demanded.”
(Complete audio of last night’s meeting can be found in the media box above. Also available is a copy of the amended 2012 municipal budget that was approved last night, a copy of the budget originally introduced by council back in March prior to the referendum, and copies of Affordable Housing resolutions that were also approved by council last night.)
The amended $44 million budget approved last night still includes a 5-cent tax rate increase separate from the 9-cent hike that was the subject of the unsuccessful referendum. Those 5 cents raise the municipal tax rate from $0.84 per $100 of assessed property value to $0.89, meaning the owner of a home assessed (for tax purposes) at the township average of $160,828 will pay about $1,431 in municipal taxes for 2012, or about $80 more than in 2011.
With the rejection of the referendum by voters and significant public opposition to an alternative plan proposed by council and the township administration that would have seen residents pay a separate fee for trash collection, the township needed to find new revenue or make expenditure cuts totaling $2.27 million in order to balance the 2012 budget.
By making the previously-announced staff cuts and trimming some other expenditures, the township will be able to save in excess of $900,000. In order to fully balance things out, however, the amended 2012 budget makes use of a larger portion of the township’s surplus fund as a form of revenue than was included in the original version of the budget.
In order to avoid an even greater financial crisis next year by draining the surplus fund so low, the township needs to make additional cuts to expenditures – including possibly more layoffs – prior to the start of 2013 or find ways to regenerate surplus at a greater rate than has been anticipated for the remainder of this year.
“So after all these layoffs, we’re still going to be dealing with approximately $1.3 million you’re going to have to come up with by next year then?” one resident asked during the public participation portion of last night’s meeting.
“That’s right,” Township Manager Richard Krawczun responded.
“There’s going to be meetings, and we’re going to start them in June, working on next year’s budget,” Councilman Greg Puliti added. “Basically, everything’s going to be on the table.”
Later in the meeting, Puliti said, "Tonight’s adoption of the budget does not solve next year’s revenue gap and we will be confronted at future meetings [with] deciding [on] reductions or eliminations of more services. As we move forward I believe the discussion is going to focus on what services are core services that we need to provide for this town."
Of the five positions being cut in the police department, one is currently vacant because a recruit hired in March recently dropped out of the police academy. Another position is currently filled by Deputy Police Chief Joseph Prettyman who plans to retire later this year. The remaining three police positions will be eliminated by laying off the two patrol officers with the least seniority – Chris Stylianou and Iwona Smith – and another recruit, Ryan Dunn, hired in March who remains in the police academy.
Also being laid off are a clerk from the tax collector’s office, a part-time public health nurse from the health department, a recreation coordinator from the recreation department and a part-time fire apparatus mechanic. Two vacant firefighter posts and a vacant secretary’s position in the township manager’s office will be also eliminated. A park maintenance worker in the public works department who is resigning because he is moving away also will not be replaced. The employee whose hours are being reduced is an executive assistant for planning and redevelopment.
Some of the handful of residents who spoke at last night’s meeting urged council members to make further cuts to reduce the burden on taxpayers, while others spoke out against the layoffs, particularly the cuts to the police department given the increase in crime the township experienced last year.
Prior to voting on the amended budget, council members offered the following remarks:
Councilman Greg Puliti:
“This has been a long process with having to make hard choices to balance this year’s budget. We’ve heard lengthy public comment wanting to cut township expenditures, and that’s what we did. The township budget is a service-oriented business and reductions in expenditures relates to cuts in services. It’s that simple. Tonight’s adoption of the budget does not solve next year’s revenue gap and we will be confronted at future meetings [with] deciding [on] reductions or eliminations of more services. As we move forward I believe the discussion is going to focus on what services are core services that we need to provide for this town.
"I’d again like to thank the two citizens who took the time to have an in-depth look at the budget and gave council the courtesy of a public response... I respect the unions for coming out to defend their members. But I’d also like to say, as the mayor and manager have stated before, I have full faith in the chief’s [Police Chief Daniel Posluszny] leadership of this [police] department, now and in the future.
"During the course of the budget meetings, there have been a few unflattering – to say the least – comments and opinions made about the township manager. And I would like to respond to those comments now. The job of the township manager, besides running the day-to-day operations of the township, is to craft and put together a budget based on the policies set forth by this council. Municipal finances are not simple mathematics and require a superior knowledge of local government finance law – which he has. As manager, not only does he have the highest ethical standards I have ever seen, he also has the utmost respect and austerity for the taxpayer’s dollar, and has my full support for his leadership and guidance to this council, now and in the future.”
Councilman David Maffei
“Mr. Richard Krawczun, our municipal manager, is responsible for our day-to-day operations of Lawrence Township. He is more closely involved with the welfare of our community and loves Lawrence as much as my fellow council members at this table. But what about our residents who, at this moment, are participating in one or more of our programs, and those spectators who enjoy watching and conversing with those around them?
“It is an extremely difficult task to take the list of all our township’s responsibilities to its citizens and then have to decide what services or individuals must be eliminated and still have our town working well and progressing on its programs. I was not elected to council to dismiss people from their means of support. Since January our energies have been focused on the budget and how it would affect our services and township employees; what departments could least afford to lose some of its support staff and still fully function on limited time.
“Council has listened to the health, municipal court, engineering and construction, police, fire, public safety, recreation and ELSA [Ewing-Lawrence Sewerage Authority] departments on what is needed to function on a steady level. Mr. Krawczun has taken our recommendations from many long discussions and constructed a plan that will succeed for our residents. I believe one of our functions is to listen to our township manager, as he has the most current findings on our township’s wellbeing. I would be remiss if I did not vote yes on his recommendations.”
Councilman Michael Powers:
“First of all, the manager serves at the pleasure of the council. If we did not believe that Mr. Krawczun was doing the job, we would remove him from office. Let’s remember, although it’s five Democrats sitting up here, there was a bi-partisan review when Councilman Bostock was part of council. Republicans and Democrats gave their vote of confidence to the manager in terms of his performance review. So, again, council sets the policy.
“I heard there’s a lot of complaints in terms of council not listening. But this is democracy in action. You are seeing the council, as a result of democracy on April 17, responding to the requests of the residents. We had proposed to remove garbage from the municipal budget. There was an overwhelming ‘No’ to taking garbage out of the budget. This budget that hopefully we’re going to adopt tonight has garbage back in the budget. But, that being said, we all know about the shortfall for next year. So as Councilman Puliti has indicted, everything is on the table for next year, and that includes garbage. We’re going to be looking at everything.
“And, frankly, one of the frustrations with the 2 percent cap is if you have an inefficient municipality and you have a lot of waste and you have a lot of folks sitting around doing nothing, it’s easy to meet the 2 percent cap – get rid of the dead weight. But if you’re running a government in an efficient manner, there’s no fat to remove – you’re cutting into bone. And that’s what you’re seeing tonight. You’re seeing the council being responsive to the voters and making the cuts that the voters have demanded. You heard from our municipal manager – 13 positions are being eliminated, one is being reduced [from full-time to part-time]. This is across the board. This is not us targeting the police department. This is not us targeting the public works department. Every department has felt the cuts – the health department, the recreation department, public works, police…this is across the board.
“One of the things from a policy perspective that I made very clear in my meetings with Mr. Krawczun is shared sacrifice; that this had to be across the board in terms of these painful cuts that we’re having to make as a result of this difficult situation we find ourselves in. Now that being said, we’re not through the woods yet. Don’t think that, ‘Oh, everything’s great now.’ We have been fortunate to have a large commercial ratable base in Lawrence Township. When times were good economically, that commercial ratable base subsidized the residential taxpayers. Unfortunately, we’ve had the bad economy and, as a result, because we have a large commercial ratable base, that subsidy has disappeared and now we have to make the painful cuts that we’re doing here tonight.”
Councilwoman Cathleen Lewis:
“First, I want to address some of the comments that came up tonight. I also want to point out that Mr. Krawczun, as many of you have pointed out, is indeed an employee of this township and an employee of this council. And, as such, he is a public official who has taken many hits over the last few months and he should be applauded for doing so in such a professional manner. He presented a budget that was not popular; that was, I’ll be quite frank, not a budget that I had hoped to face in my first month in office. But I will tell you, when I looked at this budget I looked at it from the same viewpoint that many of you do. I looked for cuts. I looked ways to share services. And the simple truth of the matter was many of those things had been done for years. And when you come to find that the budget was already to the bone, there is nowhere to go except increase revenues or make cuts that will hurt.
“Even the citizens that have come up here have said there wasn’t a hidden largess somewhere, there was not an extra pot of gold somewhere that we were sitting here hiding. There is none of that here. However what I did find was that the state mandates and the 2 percent cap have tied the hands of the municipalities. Laws that govern the tax appeals that are paid out have decimated our reserves, forcing us to use municipal funds to repay the debt to the school board and county when paying out successful tax appeals. Despite the fact that we receive roughly 20 percent of the property taxes, we pay out 100 percent of the appeals. The 2 percent cap was intended to curb the rise of property taxes, however what it has done for this municipality and municipalities all over the state is prevent our ability to provide the services that residents come to rely on.
“Tonight and many times over the last few nights we’ve heard that this budget is over-reliant on property taxes. Well, the bill that has been proposed that would put user fees under the cap will make it impossible for the township to collect user fees for services to cover their costs – that includes fees for recreation, inspections and health capacities we are already doing. Not just trash, but everything we do; we will not be able to cover the costs through fees if that legislation goes forward. The overreliance on property tax is a continuing problem. It is not a problem that this township is unique in. It is the way that the state has set up this system. When we approved the referendum we approved it to ask residents what they wanted to do. Did they want services to continue in the way they’ve always been provided? If they did, it would cost money. The user fee was an attempt to address the service reduction without having to raise taxes. We heard you. Everyone said ‘No.’ That leaves us only with cuts.
“And I will point out that only one-third of these cuts touch the police. For residents who have asked us to look elsewhere, we have. And as other council members have indicted tonight, we are not done looking. We will continue to look at the June meeting so that we can start to make those cuts for 2013. The cap did not work to address all the loopholes. We cannot continue to live under this cap unless we address them. Tonight’s vote and tonight’s layoffs in this budget represent what municipalities will have to do to live under a cap. They will have to cut services. We will have to lay off necessary and important personnel. It is not a budget that will be popular. It’s not one that anyone on this dais wants to have. Unfortunately, these are the choices we’re left with and this is what the residents asked for. And that is why I will be supporting the budget tonight.”
Mayor Jim Kownacki:
“I’m not going to sit here and repeat what all my fellow council members said, but I do support my manager, Rich Krawczun, 100 percent. Over the last few months, I know, personally, we went toe-to-toe on a few of the issues but we worked them out and you looked that much closer at the budget to come up with the answers. I support the police chief. He is the commander; he is the top man. If there’s problems in the police department, that’s something he’s going to have to deal with and get through. It’s something I don’t have any control over. I want to thank all my council members for the past months, the extra time we had to put in, the Saturdays we had to meet and come up with a budget. The residents that volunteered, I want to thank you. We hear you, we hear the voters. What we come up with tonight, it’s hard for all of us. Speaking for myself, it is hard. I’m a union member. But I looked at everything. I’ve got to put aside being a union member and say I’m now the chairman of this board, the mayor, and I’ve got to vote the right way. I support the budget if it goes through tonight. There was nothing else we could do.”
For Municipal Budget Background, See:
- May 24: "Letter to the Editor: 'Day of Reckoning' for Lawrence"
- May 18: “Letters to the Editor: Police Chief Should Retire”
- May 16: “Township Council Moves Forward With Layoff Plan”
- May 14: “Letter to the Editor: ‘Don’t Give Up the Ship”
- May 2: “Patch Readers: No Cuts to Police”
- May 2: “Township Council to Decide Budget Changes by May 15”
- April 25: “Balancing Lawrence Township’s Budget”
- April 20: “Help the Council Balance the Budget”
- April 20: “Council Gets an Earful in Wake of Referendum's Defeat”
- April 18: "Tax Increase, School Budget Shot down by Voters"
- April 16: “Governor Weighs in on Municipal Tax Referendum”
- April 16: “Sample Ballot for Tuesday’s Election Contains Error”
- April 13: “Letter to the Editor: Resident Opposed to Tax Hike Urges Council to 'Go Back to Drawing Board'”
- April 12: “Municipal Tax Referendum Forum to be Held Tonight”
- April 11: “Letter to the Editor: Township Manager Explains 'Need' for Tax Referendum's Approval”
- April 10: "Letter to the Editor: Municipal Tax Referendum is 'Best Option to Preserve Services With the Least Cost'"
- April 2: "Residents Grill Township Officials on Tax Referendum"
- March 28: “School Budget, Municipal Tax Referendum Subjects of Rival Meetings Thursday”
- March 26: “Municipal Budget Introduced, Stage Set for Tax Increase Referendum”
- March 26: “Last Chance to Register to Vote for School Board & Tax Referendum”
- March 20: “Township Manager Answers Tax Referendum Questions”
- March 14: “Trash ‘User Fee’ Would Be Mandatory If Tax Referendum Is Voted Down”
- March 8: “Usage Rate for Sewer Bill to Increase 15 Percent”
- Feb. 23: “36 Layoffs, Recreation Cuts Rejected by Town Council”
- Feb. 9: “Details of Tax Referendum, Other Alternatives Given”
- Jan. 18: “Township Manager Presents Proposed 2012 Budget, Recommends Referendum to Exceed Tax Increase Cap”