BRIDGEWATER, NJ - The ongoing coronavirus pandemic has taken a toll on Bridgewater and its finances.
The township council has been examining measures to mitigate those impacts on municipal coffers.
The town’s governing body introduced three ordinances June 4 regarding potential severance liabilities for employee retirements or layoffs, various municipal road improvements and the establishment of a zoning permit fee schedule.
The public hearings on all three ordinances are slated for June 15.
The first ordinance would provide for a special emergency appropriation, up to a maximum amount of $500,000, to fund contractually required severance liabilities that would result from the retirement or layoff of township employees.
Bridgewater Mayor Matthew Moench said that, under state law, a special emergency appropriations bond allows towns to borrow for “specific enumerated issues,” such as unused vacation and sick days. The township had the liability, had already had some retirees this year and could possibly also have budgetary layoffs, primarily due to COVID-19, which closed town hall until the week of June 8.
“There’s a requirement to make payouts to employees when they leave,” said Moench.
He said that would normally be done during the course of the municipal budget, but that the township would not be able to do so in entirety this year due to COVID-19, the effects of which have already cost Bridgewater some $2.1 million in revenues. The ordinance would spread out employee payouts over five years, which Moench added would “help enormously.”
“It’s kicking the can down the road five years,” said council president Howard Norgalis. “It seems prudent now. It’s a really tough budget.”
Councilman Timothy Ring asked how many employees are eligible for retirement and payout. Moench replied he would have to get some data, but that there is a certain amount of time put in for retirements.
Ring said that some employees might choose not to retire, while Moench said that some might leave in other ways, or choose not to use their vacation time. Norgalis added that the state does not permit municipalities to ask employees when they intend to retire.
Councilman Michael Kirsh asked about current municipal policy, and if employees are permitted to bank their sick and vacation days. Moench said his understanding is that if employees have vacation days, which have been set by labor agreement, then he believes they are allowed to carry over all their vacation days.
Sick days, consequently, are capped, and would be lost if they were not used. Prior to 2014, employees were also entitled to a payout via their union contract.
Kirsh said the matter deserves its own conversation on what the policy “could be or should be.” He also said he would like to move forward with flexibility, but not “open-ended liabilities.”
Council vice president Filipe Pedroso inquired about the township’s layoff plan, and Moench said it is being finalized. A notice had been sent to town employees a month prior about possible reductions in force, although no official township layoff notices have gone out, not yet.
There is the potential for “budget-related lay-offs,” with the council bonding five years for the payouts, ostensibly 20 percent at a time, Moench said. Norgalis asked if payouts could be made early, and Moench said he believes that is the case.
“Bonding is now extremely cheap,” said Pedroso.
He also said Bridgewater does not need to be hit with a tax increase, and needs to get its revenue streams going again.
“It’s smart for the township to do it this way,” he said, adding it is a smart business practice.
“It’s an unfortunate but necessary reality,” said Norgalis, before the five council members unanimously introduced the ordinance.
The second ordinance is for a bond ordinance that would appropriate $3.5 million for various road improvements in and by the township. It also authorizes the issuance of $3,325,000 in township bonds or notes, in order to finance part of the appropriation.
Moench said the ordinance would allow the municipality to go ahead with road improvements this year, and to bring in a consultant to help the township plan ahead and rate its roads in terms of priority for repairs. It would allow the public to know how roads are selected and funded, and would also allow the township to develop a long-term road repair plan instead of having to borrow funds to fix its roadways.
“It’s this, or not doing roads,” said Moench. “Not doing roads is not an option.”
He elaborated that the township would also partner with the county on certain roads. He said that millions of dollars in projects have already been bonded, but have not yet been done, with 85 percent expected to be accomplished this year.
Kirsh said the bids that have been coming in are attractive. He said he hoped that pattern will continue, “and we get as much as we can for our money.”
Moench said he believes it would continue, with prices coming in lower, and could cancel the township’s debt or allow it to repair more roads.
Councilman Allen Kurdyla added that the timing is right, with the cost of materials, to “get as much done as we can.”
Pedroso said that, for as long as he knew, the township had bonded every year for road repairs. He commended Moench as the first mayor to state his plan, goal and expectation to get off the “debt model and into a pay-as-you-go plan,” and to avoid as much debt as possible.
He also said he supports both Moench’s vision going forward, and the ordinance, which was introduced unanimously.
Norgalis thanked Director of Municipal Services Thomas Genova for nurturing the third introduced ordinance, which would establish a zoning permit fee schedule. Moench added that it had been done, in part, after the council had asked in January to examine the fee ordinance and make sure it was up to date.
It was found to not be up to date with zoning permits, he said.
Norgalis said permits range from $30 to $50, and that the township is now losing some $12,000 to $13,000 without the ordinance.
“It’s not an onerous fee,” said Norgalis, “but we should be recovering our costs.”
Norgalis said the ordinance was a “recognition of reality.” The ordinance was then introduced by a 4-1 count, with Kurdyla casting the lone vote against it.
The council also unanimously ratified two ordinances that evening. The first amended sewers and sewage disposal measures to include grease traps.
Township administrator Michael Pappas said it was Genova who had taken the lead on this ordinance as well.
“It fixes a long-standing problem,” said Norgalis.
The second amended affordable housing measures to allocate responsibility for administrative agent fees garnered in affordable housing sales/resales.
“It simply assesses a 3 percent fee on the resale of affordable housing units as part of the transaction,” said Pappas, who added the fee would be taken from the proceeds.