Council Set To Introduce Budget With 2.48 Percent Rate Increase

MOORESTOWN, NJ — Moorestown Council is ready to introduce its budget after cutting the suggested tax increase in half. Council held its final budget hearing on Monday night, May 20, at town hall. At that time, council voted 3-1 in favor of moving forward with a proposed budget that includes a 2.48 percent tax rate increase.

Mayor Lisa Petriello, Deputy Mayor Nicole Gillespie and Councilman Brian Donnelly voted in favor of moving forward. Councilwoman Victoria Napolitano voted against moving forward. Councilman Mike Locatell was absent.

No date for official introduction has been set. The next regular council meeting is scheduled for June 10.

Under the current $26,477,000 draft budget, the owner of a $454,000 would be faced with a $45.40 increase in taxes, as opposed to the $90 that would have come with a previously suggested 5 percent tax rate increase.

When council met for a budget hearing on May 15, eliminating a tax increase altogether remained the ultimate goal. That would require appropriation cuts and/or revenue increases amounting to $400,000, according to township officials.

During that hearing and the hearing held on Monday, council members decided there wasn’t anything further that could be cut from the draft budget, although Napolitano said she would rather see township staff increased at a slower rate.

Napolitano recognized the need for a Stormwater Management Coordinator, but initially said a Utilities Manager wasn’t immediately necessary and the township could hire just one part-time code enforcement officer, as opposed to two.

The other members of council in attendance said the Department of Public Works was in need of staff. It went from 30 dedicated employees in 2013 to 22 the following year, and has remained at that number since.

Napolitano said the biggest disagreement council members were having surrounded the township’s surplus.

The increase was initially suggested in part to cover the impact of tax appeals by Macy's and Lord and Taylor's. The township must pay $325,000 each year for the next five years to PREIT for Macy's and Lord and Taylor's tax appeals, beginning this year. The tax appeals will be completely paid off in 2023, and will disappear from the budget beginning in 2024.

At the May 15 meeting, Locatell had suggested using the surplus to pay the tax appeals so the township wouldn’t have to raise taxes. The surplus was over $8 million at the start of the year, and Chief Financial Officer Tom Merchel said he would be comfortable taking $2.6 million out of the surplus.

However, Napolitano suggested on Monday night that the township take the rest of the $400,000 out of the surplus, saying it’s “higher than it’s ever been.” Taking another $400,000 out would mean taking about $3 million out of the surplus. Council used the surplus to pay for the township's obligation to the tax appeal last year, according to Merchel.

“We should do it this year, and we should consider doing it next year,” Napolitano said. “We’re carrying more surplus than we actually need. … It’s great to have a big surplus, but how much do we really need?”

She said Merchel’s job is to be as conservative as possible, while council’s job is to make tough decisions. She also said the township puts money back into the surplus every year, but Petriello said there are factors that show replenishing the surplus will be more difficult this year.

“It’s like anticipating a pay increase that hasn’t come yet,” Petriello said.

A big surplus helps the township maintain its bond rating, which is currently AAA+. Napolitano said that’s important, but also pointed out the surplus is money that was collected through taxation.

See related:
Possible Tax Rate Increase Cut In Half; More Work To Do On Budget
Moorestown Draft Budget Brings Almost 5 Percent Tax Rate Increase