2007 Municipal Budget Adopted

The 2007 municipal budget, with a 3.7 percent increase in the municipal tax rate, was recently passed by the Township Committee. The tax rate will increase 1.17 cents per hundred dollars of assessed value; each cent raises a total of about $65,000. The owner of an average assessed home of $237,000 will pay $27 more in municipal taxes than in 2006.
The increase is due largely to state-mandated costs, but also to long-term capital planning. State aid increased $23,000 this year while pension payments to the state increased by more than twice that amount. The township committee has long favored pay-as-you-go capital funding rather than bond today and pay tomorrow. For the second consecutive year the township is not authorizing any new debt. At the end of 2006 there was over $300,000 in capital surplus. Rather than using this for a one-time property tax cut some of the funds were used to pay down debt authorized in 2005 (for which bonds were not issued) and for non-recurring capital expenses. By purchasing a backhoe instead of leasing over 5 years the township saved about $15,000 in interest payments.
This year, less surplus is used to balance the budget than in 2006. Since the adoption of the Highlands Act, the bond ratings of municipalities which are partly or entirely in the Highlands preservation area have been affected by the Act’s potential to limit growth. Reducing debt and using less surplus will preserve the township’s bond rating and ensure more affordable interest payments should bonds be issued in the future.