NEW PROVIDENCE, NJ – The Borough Council introduced the $20.7 million municipal budget for 2017 at the Monday, Feb. 27 meeting. The hearing date for the budget is set for Apr. 3. Additionally, the council postponed the introduction of the ordinance for service charges and fees.
Councilman Michael Gennaro explained that the municipality can raise its annual budget by 0.5 percent. However, the municipality may exceed the budget limit up to 3.5 percent if deemed necessary. This increase must be done via ordinance. The difference will be placed in the “cap bank” and the exceeding amount has to be used within the next two consecutive years. New Providence has done this for several years. The excess budget increase will amount to approximately $412,800, or approximately 3 percent.
However, the overall tax rate increase is approximately 1.5 percent, “well below the cap of two percent,” Gennaro said. The tax rate increase will translate into a $40.22 annual increase for the average home with an assessed value of $282,000, slightly less than $40.70 as stated at the Feb. 15 meeting. A total of approximately $12.8 million will be raised by taxes to support the municipal budget. Gennaro also explained that the total value of assessed borough properties has grown to approximately $38 million recently, not $40 million as previously calculated.
The council also introduced the Special Improvement District (SID) budget of approximately $78,000 for 2017. The hearing will take place on Apr. 3.
Additionally, the council discussed an ordinance draft amending the borough’s fees and charges for services. The ordinance was on the agenda for the first reading but was tabled. Gennaro pointed out that one of the charges in this ordinance was a sewer connection fee that was set increase to $1,000 from $50. Gennaro was appalled by the suggested 1900 percent increase and asked “why such a dramatic increase” was needed.
Gennaro noted that the same fee appears to effect single family homes, as well as multi-dwelling buildings and businesses. “It doesn’t make any sense to me.” He also pointed out that the usual residential 4” connectors and 16” connectors for businesses “have a tremendously different impact on the sewer system.”
Borough Administrator Doug Marvin noted that there are only a limited number of new sewer connections each year. The borough employees had done some research among neighboring towns and concluded that the sewer connection charge is typically $1,000 to S1,500. Marvin also stated that the increased sewer connection fee would allow the borough “to recoup some money spent for infrastructure.”
Gennaro pointed out that the sewer connection fee never financed any infrastructure spending. The borough is usually funding capital improvement projects through bond issuance.
Mayor Al Morgan and Council President Gary Kapner also expressed their reservations for the proposed fee hikes. “We have a little bit more homework to do,” Gennaro said. He also stated that he would like to see the research results from the surrounding towns regarding the fees.
However, the council approved the community garden plot fee of $50. The other municipal fees will be further discussed at a council meeting in a near future.