North Bergen held a budget hearing at its May 26 Board of Commissioners meeting after the budget was introduced. The $100,251,950 budget was sent down to Trenton for state approval, according to Township Administrator Chris Pianese. Due to COVID-19, the state has not yet examined it.
According to Pianese, the township has been asked by the state to hold off on voting until the next meeting. Pianese said that the commissioners can proceed with the hearing but vote to adopt the budget at its next meeting.
Breaking milestones
Pianese said that, for the first time, the budget has exceeded the $100 million mark. It saw an increase in $1 million from last year. This is a .98 percent total increase. The tax impact is 1.9 percent, approximately $73 per household.
The number of municipal employees has risen to 545, up from 526 in 2017. Pianese said this is a result of beefing up the police department.
Pianese said that for many years, the township was under cap, meaning that it could have raised tax rates and spent more.
The township is under the tax levy cap of $70 million by about $2 million totaling $68 million. Its appropriations cap for 2021 was about $76 million, but the township is under by nearly $5 million totaling $71 million.
“This was a tough budget considering COVID-19,” Pianese said. “We lost a number of revenues.”
Expenses
The first expense was the COVID-19 vaccination rollout.
“Janet Castro has done a great job in creating our vaccine center,” Pianese said. “We’ve created the portal, allowing our residents to go online and make appointments.”
The township has nearly reached the milestone of 50 percent of the population fully vaccinated. Over 18,000 doses have been administered, which Pianese said was on par with communities of similar size.
He highlighted projects in other departments that contribute to the budget. The Department of Public Works includes paving, the “Broom and Barrel” project to keep streets clean, and graffiti removal with the police department. The township has also purchased a traffic truck.
Public Safety, parks and more
The police department is back up to a full “complement” of 135 officers. Amid a year of reckoning with police departments, the township has doubled down on its police force. Pianese credited Police Chief Peter Fassilis and the department for the 23 percent decrease in crime last year.
The township continues to work toward establishing a mini-police precinct downtown. “I’m negotiating the lease with a storefront,” Pianese said.
The police department is in year two of its body camera program. The township also purchased new breathalyzer technology. The department has retained its NJASCOP accreditation and purchased six new patrol vehicles.
N.B. CARES is working on opening a brick and mortar location, and senior programs will resume in June. The Library and Community Center is expected to be completed in 2022.
Free COVID-19 testing is still available in Braddock Park. The 10th Street Park renovations will be completed in late summer. A gazebo will soon be installed at the recently refurbished 38th Street Policeman Park.
This year, the city spent approximately $570,000 for salt and employee overtime for winter storms. This is up from approximately $195,000 in 2020, but comparable to the $470,000 spent in 2019.
Tax appeals
Tax appeals are down. Pianese said that the first portion of the payment for the property tax revaluation is included in this budget, totaling $180,000. The township will pay that every year for five years.
“This was a nightmare 10 to 15 years ago,” Pianese said. “We were borrowing year after year to try to deal with lost tax appeals. Now we budget enough to pay our tax appeals that need to be paid in any given budget year.”
The budget for tax appeals in 2021 is $690,000, up from $310,000 in 2020. But still down from $1.1 million in 2017, marking a 41 percent decrease.
Pianese said the reval should eliminate the bulk of tax appeals after the first year because every property will be at true value.
“It’s unbelievable through COVID-19 that we’ve maintained a 98.6 percent collection rate, which is just unheard of,” Pianese said. “Some towns did get hit, but we’re right where we want it from last year, which is a credit to everyone involved.”
The rate stayed at 98.65 percent in 2020. Since 2008, the rate has slowly climbed from 97.11 percent.
State aid and revenues
In North Bergen, state aid has remained stagnant since 2011, at approximately $7 million. Pianese called it “absolutely ridiculous.” Mayor Nicholas Sacco added that it was “disappointing.”
“John Corzine was the governor who gave us a decent amount of state aid,” Sacco said, noting that state aid at the time was around $15 million.
Too offset the lack of new state aid, the township is getting creative with revenues, according to Pianese. Since 2016, it has increased revenue from payments-in-lieu-of-taxes (PILOT) agreements to approximately $4.2 million. That is a 57 percent increase.
This year’s revenue includes two new PILOTs that the township is seeing revenue for. One new revenue source is from Spectrum Hotel. Pianese said the township is anticipating a tax of $476,000 from the hotel for the year.
Pianese added that the PILOT for the 67th Street project on Kennedy Boulevard is now coming online, resulting in the township collecting $200,000 in taxes. Another “revenue enhancement” is from a settlement with Palisades Medical Center. This is the second year in which the township is receiving $600,000 from the hospital.
Budget surplus
The budget surplus has decreased by approximately $700,000 to $12.8 million. Pianese predicted a bounce back into the $13 million range next year, with the infusion of COVID-19 relief funds.
Pianese said that these are the numbers that Moody’s looks at when determining a credit rating. For the past two years, the township has been in the Aa2 category.
This April, the township was rated again and “received a great write up,” Pianese said. The township was able to sell some of its debt at a low rate due to the good rating.
“The results of that sale impact this budget and allow us to keep our debt service flat,” Pianese said.
The debt service, which is $66.7 million is flat compared to last year’s debt. Pianese said that meant that the debt has not gone up at all.
Bottom line
According to Pianese, the township was able to keep the budget reasonable and the tax rate down because it had a great year when it came to health benefits. Claims were way down, and the township was able to reserve over $2 million in its insurance fund. Pianese said this allowed the township to lower the health benefits budget for the first time, by $1.2 million.
Pianese said that the claims could be artificially low because of less usage due to COVID-19 and everybody being at home. He hopes that he can sustain that level of claims throughout the next six months.
Pianese said the bottom line is that since 2016 and even before that, the township has consistently experienced an approximately one to two percent increase in the tax levy. This year, it will be a 1.9 percent increase.
That averages out to a 1.76 percent increase since 2016, totaling an average of $64 to homeowners each year since then.
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