For the second time in 17 days, Lawrence Township Manager Richard Krawczun stood before a room packed with unhappy residents Thursday (March 29) and attempted to answer questions about the township’s $43.35 million budget for 2012 and explain how a decline in revenue – particularly from a cumulative decrease of over $167 million in ratables due to successful tax appeals since 2007 – has led to the municipal tax referendum that will be put to voters on April 17.
Audio of the question and answer session that followed Krawczun’s formal PowerPoint presentation at the Slackwood Fire Co. firehouse on Thursday can be found in the media box at the right.
Krawczun will appear at another such forum that will be held at 7 p.m. on April 12 in the community room of the at 2211 Lawrence Rd. (Route 206).
During Thursday’s two-hour forum hosted by the Colonial Heights Civic Association, residents peppered Krawczun and Township Councilman Greg Puliti with questions about the proposed municipal tax increases and the user fee that would be instituted for residential trash collection should the tax referendum be rejected by voters.
Municipal employee layoffs, the services that municipal governments are mandated by law to provide, the tax-exempt status of Rider University and The Lawrenceville School, the township-wide property revaluation that will begin next year, the overall business environment in Lawrence Township, and the Wal-Mart store and Capital Health System hospital that were proposed but never built in the township were among the many topics covered during the Q&A session.
Speaking about the staggering tax base decline the township has experienced in the last five years due to successful tax appeals by residential and commercial property owners, Krawczun noted that as of 2 p.m. Thursday more than 120 owners – with a total combined property value of $158.8 million – had filed new tax appeals for this year. And with the filing deadline not until the close of business today (Monday, April 2), that number of appeals was only expected to grow.
The 2012 budget 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 a 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 school board election and school budget vote. Voter approval is needed because the 9-cent increase exceeds the state’s 2 percent tax levy increase 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.
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 said that spending is not to blame for the township’s budget woes, blaming instead the decline to the tax base, decreases in state aid in recent years and cash refunds the township has had to pay out due to all the successful tax appeals.
If voters reject the tax referendum on April 17, the township will be forced to revise the budget 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.
While trash would continue to be removed the same as it currently is, including bulk item pickup, all trash costs would 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.
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