NEW PROVIDENCE, NJ – The borough is still working on the current year’s budget, but preliminary information on the budget figures were revealed at Monday's council meeting. Councilman Michael Gennaro said that the Budget Committee, which includes himself, Mayor Al Morgan and Councilwoman Nadine Geoffroy, had a “very constructive meeting” recently.
According to Gennaro, this year’s budget doesn’t seem to have “an awful lot of controversies.” The assessed property valuations have also gone up again this year to the tune of $26.9 million or approximately two percent, which is more than the borough had anticipated. The added valuation is helping the borough to keep the budget increase low as well as allowing the borough some flexibility with spending, Gennaro explained. The revenue is expected to increase by 4.45 percent before any grants. The appropriations are estimated to rise 3.85 percent.
Overall the municipal part of the property taxes is estimated to go up 1.61 percent, staying within the two percent cap. The municipal tax increase for an average house valued at $282,000 will be $46.19. The tax increase includes the open space tax as well as the library tax. Gennaro explained that the borough is gradually increasing the open space tax from 0.06 percent to 0.07 percent. The increase amounts to $2.46 per average house valued at $282,000 over the course of the year.
Gennaro noted that the county taxes are nowadays taking a bigger chunk of the total property tax bill than municipal taxes. The county taxes will be going up by $728,000 in New Providence.
One of the biggest spending items at the municipal level is the pension fund contributions that will rise approximately $106,000 this year. Gennaro noted that the pension fund crisis is due to the state spending. The municipalities have contributed in full to their pension funds.
The borough has also set aside $25,000 for the cost of revaluating homes and businesses. It has been “quite some time” since the last revaluation of properties took place in the borough. Gennaro estimates that the process will begin within the next two years. The state is pushing for revaluation in order “to make sure that the tax burden is spread evenly” across the residential and business properties. The borough is also increasing its tax appeal reserves by $25,000.
Compared to last year, the total tax burden for the average home valued at $282,000 will increase by 1.26 percent, amounting to $13,610.12. The municipal portion of the property tax will be $2,919.76 (1.61 percent increase compared to last year), the school tax will be $7,644.05 (a 0.58 percent increase), and the county tax will be $3,046.31 after the 2.69 percent tax increase compared to 2017.
Gennaro noted that residents should be thankful for the Board of Education (BOE) for keeping the tax increases at bay as the school taxes represent the largest portion of the total property tax bill.
The budget will be introduced at the March 20 meeting and voted on at the April 23 meeting.