Breaking Down Montclair's New Town Budget: Manager Offers Recap Of Spending, Income

MONTCLAIR, NJ — Montclair’s town manager recently shared an update about the 2025 municipal budget, breaking down the numbers by revenues, appropriations and local utilities.

The Montclair Town Council introduced this year’s budget in May. Town administrators said the budget includes a 1.98 percent tax rate increase. A home valued at $639,630 will see an increase of $107 to the municipal portion of its property taxes.

The council voted unanimously to approve the spending plan in June. Read More: Montclair Council Approves 2025 Town Budget

Last week, Montclair Town Manager Stephen Marks offered a budget recap for local residents. View the full presentation online here.

INCOME AND SPENDING

“Broadly, the municipal budget consists of three main components: revenues, appropriations, and local utilities (sewer, water and parking),” Marks explained.

According to Marks, “appropriations” are the funds allocated to cover the township’s anticipated expenses required to run the municipality for the year. Examples include salary and wages, as well as pensions and health benefits. They also include other expenditures needed to operate the township, such as garbage disposal, wastewater treatment and liability insurance.

On the flip side of the coin, “revenues” are income sources that the township relies on to fund operations and services. The majority of municipal revenue comes from “ad-valorum” property taxes on all residential, commercial and industrial properties, apartment buildings and vacant land.

Marks applied those definitions to this year’s town budget:

Revenues

The largest source of revenue for the municipal budget comes from local property taxes, Marks said.

The total amount of property taxes for municipal purposes is $62,590,915 in the latest budget.

The second-largest source of revenue is "Miscellaneous Revenues," which totals $23,342,403 (miscellaneous revenues come from sources like grants and state aid, as well as other local revenues like licenses, permits, fees, municipal court fines, interest on investments, and the proceeds from shared service agreements).

The majority of property taxes come from just a few categories of land: residential, commercial, industrial, apartment buildings, and vacant land. Collectively, these parcels are known as the “ratable base” (see chart below). Other categories of land do not pay property taxes, such as schools, public property, cemeteries, railroads and charitable organizations.

Appropriations

Marks reported that the total general appropriation for the 2025 municipal budget is $108,016,334. The total allocation for salaries and wages is $43,892,118. The total allocation for other expenses is $27,222,907.

The following is a breakdown of appropriations for the largest line items in the budget that come to more than $1 million:

• Police Department: $17,755,260
• Fire Department: $10,836,423
• Municipal Debt Service (Principal and Interest): $8,663,606
• Police and Fire Retirement System (PFRS): $8,057,030
• Local School District Debt Service: $7,878,650
• Health Insurance for Municipal Employees and Retirees: $7,304,218
• Department of Community Services (Public Works): $5,247,387
• Solid Waste & Recycling Collection and Disposal: $4,565,176
• Montclair Free Public Library: $4,403,915
• Reserve for Uncollected Taxes: $3,024,092
• Capital Improvements: $2,858,000
• Health, Nursing, & Senior Services: $2,069,623
• General Liability Insurance: $2,003,785
• Public Employees Retirement System (PERS): $1,739,413
• Social Security for Municipal Employees: $1,598,598
• Uniform Construction Code (Building Department): $1,057,769

TOWN, SCHOOL, COUNTY

Property taxes in New Jersey are mainly made up of three parts: school, municipal and county (in addition to a smaller library tax).

Marks said that the municipal tax rate this year is smaller than 2024, which was 2.96 percent.

The town manager offered the following breakdown of how a resident’s property tax bill is currently distributed in Montclair:

WATER, SEWER AND PARKING

Marks also commented on the town’s utilities, including water, sewer and parking. He wrote:

WATER – “The Township of Montclair provides drinking water to residents and businesses through its ‘Water Utility.’ The purpose of a utility is to provide a financially self-sufficient way of providing a ‘public good’ which pays for itself through a fee structure other than property taxes. The total budget for the Water Utility is $10,690,369. The Water Utility anticipates approximately $8,700,000 in revenue from customer billing via water meters. The Water Utility budget includes $1,554,587 in salary and wages for 15 employees and $2,625,975 in operating expenses. The Water Utility spends $2,200,000 to purchase bulk water from the North Jersey Water Supply Commission via the Monksville Reservoir. The Water Utility budget also includes $3,000,000 for capital improvements to invest in annual renewal of the century-old drinking water system.

SEWER – “The Montclair Sewer Utility operates and maintains Montclair’s wastewater collection and conveyance system for sanitary sewage. The total annual budget to operate the Sewer Utility is $9,977,270. The anticipated revenue from the Sewer Utility is $8,250,000. The Township of Montclair, through its Sewer Utility, pays the Passaic Valley Sewerage Commission (PVSC) $5,700,000 to accept its wastewater at the sewerage treatment plant in Newark, NJ, representing a 14% increase in the rate charged by the PVSC in 2024. The Sewer Utility budget appropriates $2,000,000 to keep the system in a state of good repair. The Sewer Utility has four employees.”

PARKING – “The Montclair Parking Utility manages the Township’s municipal parking garages, commuter lots and on-street parking meters. The Parking Utility has nine employees and a total budget of $5,822,108. The salary and wages for the Parking Utility are $1,345,453 and other operating expenses are $2,891,500.”

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