Municipal Budget Introduced, Stage Set for Tax Increase Referendum
Last week's introduction of Lawrence Township's $43.35 million spending plan for 2012 sets the stage for the municipal tax referendum that will be held April 17. A public forum to discuss the referendum will be held this Thursday, March 29.
Totaling 65 pages, Lawrence Township’s 2012 municipal budget was formally introduced by Lawrence Township Council at their meeting held last Tuesday (March 20). The document is available for downloading from the township website and can also be reviewed in the Patch media box to the right.
The budget – which now stands at $43.35 million following revisions to the proposed spending plan that was first discussed before council back in January – includes a 5-cent increase that will raise the municipal tax rate from $0.84 per $100 of assessed property value to $0.89, meaning that 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.
On top of that 5-cent increase, the budget also includes the 9-cent increase to the municipal tax rate that township voters will be asked to approve on April 17 through a referendum held in conjunction with the annual school board election and school budget vote. Voter approval is needed because the 9-cent increase exceeds the state’s 2 percent tax levy cap.
The additional 9 cents, if approved by voters, will raise the municipal tax rate to $0.98, increasing the 2012 municipal tax bill for the average home owner by another $144.75.
The budget and the tax referendum will be discussed in detail by Lawrence Township Manager Richard Krawczun during two upcoming forums during which the public will be allowed to ask questions.
The first, sponsored by Colonial Heights Civil Association, will take place at 7 p.m. Thursday, March 29, at Slackwood Fire Co. at 21 Slack Ave. and the other will be held at 7 p.m. Thursday, April 12, in the community room of the township police station at 2211 Lawrence Rd. (Route 206).
Krawczun has repeatedly explained that the additional 9-cent tax increase is needed to avoid the township having to use 97 percent of its surplus fund to balance the 2012 budget. To take the surplus fund so low would leave the township financially unable to respond to a natural disaster or other unforeseen crisis, and would also create future “catastrophe” because not enough surplus would be available as a revenue source to help balance the 2013 budget.
Krawczun has also explained that spending is not to blame for the township’s budget woes. Instead, he has said declines in revenue are the cause, particularly a cumulative decrease of over $167 million to the township’s tax base due to successful tax appeals by commercial and residential property owners during the last five years, including a $38.3 million loss in 2011.
If voters reject the tax increase on April 17, the township will be forced to revise the budget that was introduced by council last week by cutting expenditures. And the way that will be done, Krawczun and township council have said, is that the cost of residential trash collection and disposal will be removed from the municipal budget. All such trash costs will instead be covered by a new mandatory “user fee” assessed against all residential property owners in town.
With estimates placing that user fee at about $336 per year, Krawczun and council members have repeatedly noted that, for most homeowners, the 9-cent tax rate hike would ultimately cost less than the trash user fee. They have also stressed the fact that municipal taxes are deductible on individual income tax returns, whereas a trash user fee would not be deductible.
During last week’s council meeting, Krawczun noted that the state’s Division of Local Government Services had denied the township’s appeal of the wording that will appear on the ballot for the April 17 referendum. The township requested that the wording be changed to make it clear to voters that rejection of the 9-cent rate increase would force the township to institute a user fee for trash. The state refused and ordered that the following language appear on the ballot:
“Shall the Township Council of the Township of Lawrence be authorized to increase its adjusted tax levy by $2,275,000.00 more than the allowable adjusted tax levy which is 10.13% more than the allowable adjusted tax levy as provided by NJSA 40A:4-45.44 et seq. and shall it be authorized to increase the adopted 2012 Municipal Purposes Budget in excess of the increase limitation by 10.13% as provided by NJSA 40A:4-45.3(i).”
The following explains the reason for the governing body’s decision to ask the public question:
Budget revenues, excluding real estate taxes, to support municipal operations as they are currently provided can no longer be maintained as their same level. Specifically surplus revenue to support the budget cannot be regenerated in an amount required to maintain this item as a resource in future budgets. Fully utilizing the available current surplus balance will negatively impact future budgets beyond 2012. Reducing the amount of surplus as revenue in the 2012 municipal budget will improve the probability of regenerating that amount of surplus that can be applied as revenue in support of appropriations in the 2012 municipal budget and in future budgets.
A “Yes” vote will authorize the Lawrence Township Council to adopt the 2012 budget that was introduced and published that provided for an increase in the tax levy over the allowable property tax levy cap authorized by state law at the rate of increase described in the ballot question.
A “No” vote means that the Lawrence Township Council must amend through appropriation reduction or allowable non-property tax revenue increases in order to adopt the 2012 budget within the tax levy increase limits set forth by law.
Also during last week's council meeting:
- Several members of the public spoke about the budget and municipal tax referendum during the public participation segment of the meeting. Among them was Review Avenue resident Carol Harle, a former township mayor and councilwoman, who posed several questions to Krawczun and offered her own suggestions on how the township might be able to save money.
- Ewing Township Mayor Bert Steinmann spoke during the public participation segment to protest the purchase by the Lawrence Township Board of Education of a warehouse in Ewing that will be used as the Lawrence school district’s maintenance shop/storage facility. Steinmann noted that the purchase by the school board will take the building off Ewing’s tax roll, resulting in an annual loss for Ewing Township of about $58,000 in taxes.
- Two ordinances were introduced by council, including one increasing rates for sewer service. Both ordinances will be considered for adoption at the next council meeting on April 3. Increases in the fees charged to the township by the Ewing-Lawrence Sewerage Authority were discussed at the March 6 council meeting.
- Among the resolutions adopted by council was one authorizing the appointment of Mark Boyd as an armed security guard for the township's court facility. Boyd retired earlier this year as a captain with the township police department. The position, created by ordinance adopted at the Oct. 18, 2011, council meeting, will be paid at an hourly rate of $22.59 this year. The hiring of Boyd will free up the uniformed police officer who normally is assigned to provide security to the court for 20 or more hours each week.
Audio from the entire council meeting of March 20 can be found in the media box above, along with copies of the meeting agenda, township manager’s memo, and the two ordinances that were introduced at the meeting.
- 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”