Ocean City Mayor Reveals $79.9 Million Draft Budget

OCEAN CITY, NJ — The owner of a $500,000 home in Ocean City could expect to pay an extra $50 in municipal taxes in the upcoming year if the $79,981,465.08 draft budget presented during Thursday night’s Ocean City Council meeting at City Hall passes without any changes. That would come out to an increase of about $12.50 per quarter. The overall tax rate increase is just shy of a penny.

The introduction of the draft budget, which is $1,194,254.70 — or 1.5 percent — more than last year’s municipal budget, was part of Mayor Jay Gillian’s State of the City Address, in which Gillian talked about some of the accomplishments his administration and council have made over the last year, and some of the challenges that lie ahead.

An increase in debt service and capital accounts for about $750,000 of the proposed increase, while state-mandated increases in pension contributions account for another $300,000, according to a fact sheet provided by Public Information Officer Doug Bergen. Although the city added one new full-time employee, bringing the number of total employees to 258, wages and salaries remain relatively flat in the draft budget.

Ocean City’s fund balance is down $147,432.80, from $2,831,644.40 the previous year to $2,979,077.20. Revenues were down or flat in many categories last year, due in large part to what Gillian called “the rainiest July and August we’ve seen in many years.”

“We must remind ourselves constantly that we are a tourism-driven community, and the impacts of the summer season are felt not only by our private sector friends, but by the city government as well,” Gillian said. “ … I’m confident we will rebound and build our fund balance back up, but in the meantime, we need to continue to be conservative on our revenue projections and safeguard our fund balance.”

Chief Financial Officer Frank Donato will give a detailed budget presentation at the March 8 council meeting. Introduction of the proposed budget is set for March 22, with the public hearing and final vote tentatively scheduled for April.

During his address, Gillian spoke about the efforts to rebuild more than 18 percent of the 110 miles of roads and alleys in Ocean City, noting the city’s “complete streets approach.”

“We have replaced storm drainage systems, worked with utility companies for upgrades repaired bulkheads, installed ADA-compliant sidewalks and added other amenities wherever possible,” Gillian said. “ … That percentage figure does not include any of the projects funded in 2017, including the Fourth Ward drainage project and the north end drainage project that’s about to begin. When these neighborhood initiatives are completed, we will have repaved more than 25 percent of our roads.”

He said there is still a long way to go, and that road infrastructure is an ongoing project. He also noted that the project to completely rebuild the boardwalk between 5th and 12th streets will be finished two years early and under budget. The stretch of boardwalk being repaired was first built following a devastating fire in 1927, and work was conducted by Schiavone and Walters Marine.

He also mentioned the agreement with the federal Army Corps of Engineers for a regular cycle of beach replenishment projects, a partnership with ACT Engineering to restart the back bay dredging program, and improvements to the downtown, including sidewalks and crosswalks, among other things.

“These projects took advantage of more than $8 million in grants and the city has submitted applications for millions more in grants,” Gillian said, adding that an increase of about $135 million in ratables last year makes this “an ideal time to complete this ambitious list of capital projects.”

In that vein, Ocean City Council adopted the administration's $100 million, five-year capital plan at its Feb. 8 meeting. A copy of the capital plan presentation and related documents are available at www.ocnj.us/projects.
The total ratable base is now 11.69 billion, according to the city. Gilian said the result of that growth was a reduction by about half a penny in the tax rate, saving the owner of a $500,000 home about $25 in taxes.

Gillan also spoke about:

• Ocean City’s clean audit and AA bond rating;
• Class 5 designation in the National Flood Insurance Program’s CRS ratings, translating to a 25 percent discount for policyholders and a collective savings of more than $2.8 million annually;
• Silver Certification through Sustainable Jersey; and
• NJBIZ naming Ocean City the Most Tax Friendly Municipality in New Jersey for Retirees.

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