WEST ORANGE, NJ - Giving the public a greater understanding of where West Orange’s 2018 municipal budget of $83,225,484 will be spent, Chief Financial Officer John Gross brought more clarity to this issue at Tuesday night's West Orange Town Council (WOTC) meeting.
Gross explained that 63 percent (approximately $52 million) of the budget goes towards personnel costs. This represents a $3,518,664 increase over last year.
“We have reduced our staff from 375 in 2006 to 306 full-time employees in 2018. Without the trimming of the staff, we would be having a much different discussion than the one we are having here today,” said Gross, who explained that this is a major reason West Orange can still balance its budget with relatively reasonable tax increases as compared to the rest of the state.
Gross said that the “skyrocketing” costs of benefits, especially in employee medical costs, is the biggest challenge when it comes to balancing the budget at current staffing levels. He showed a chart that indicated that in 2002 the township was spending 11 percent on healthcare insurance costs, whereas now it is up to 18 percent. Gross added that retirement benefits were 2 percent of the budget in 2002. Today they are 9 percent of the budget.
“Employee medical costs are going up, and they will continue to go up…This is a challenge for us and all other municipalities throughout the nation,” Gross said.
Another major challenge he pointed out was the $3.2 million in uncollected taxes in 2018 to date. He added that the 2 percent tax increase this year remains reasonable with all the services that West Orange provides its citizens. Gross said that there has been an average of a 1.1 percent annual increase in taxes in West Orange over the last decade.
“This compares very favorably to the rest of the state. The average statewide tax rate is up over 40 percent in the last 10 years. Only 24 municipalities our of 565 have less taxes than West Orange, and many of them are much smaller towns,” Gross said.
He said that the $274 per month in municipal taxes by West Orange residential property owners pays for police and fire protection, healthcare services, and quality of life services – including jitney services and two times a week garbage pickup.
“West Orange residents get a tremendous value for their municipal tax dollar,” said Gross.
Gross reviewed many improvements made possible through municipal funded programs and services. These accomplishments included an improved community website, an online payment option for township services, four new shuttle/jitney buses plus an added jitney route, increased funding for the library, the beginning of the Edison redevelopment pilot program to help improve downtown, increased health inspections and the funding of a community emergency response team.
He said the township’s ability to garner almost a 350 percent increase in grant monies this year made many of the new and increased services possible.
Gross said the township’s current debt ratio of 1.259 percent is in the “relatively low area.” State law allows the debt ratio to go as high as 3.5 percent.
He quickly reviewed the capital budget, the bulk of which going forward will be needed to upgrade the aging township fire houses.
The budget hearing will take place at the next council meeting on June 12.