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The March 30, 2009 Township Committee meeting minutes have been posted.

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Reports and Communications

--Mayor Stave reported she and Mr. Cody had met with Dr. Notterman, Chairman of the Board of Health regarding the pending ordinance on cat licensing for the purpose of making sure cats get vaccinated for rabies. She and Mr. Cody conveyed information to Dr. Notterman that they had received from some of their constituents. Dr. Notterman indicated he will take those remarks back to the Board of Health. There will be a public hearing on the issue and notice of the hearing date, time and place will be posted on the web site. Mayor Stave urged residents to come out and speak either against or for the proposed ordinance. Mr. Cody also urged everyone to come out and speak on the issue.

--Members of Committee

Mr. Panconi reported he has had a couple residents ask him about George Davison Road. He stated he is aware that the road is shared by both Cranbury and Plainsboro Townships and reported Cranbury Township’s side is in terrible shape. Ms. Smeltzer indicated she will talk to our Public Works Manager to determine who is responsible for the road and let the Township Committee know.

Mr. Stannard reported he had attended a meeting on the Turnpike Widening Project in East Windsor on March 18, 2009. He stated the Project is in the planning stages and the meeting pertained to individuals’ properties rather than municipalities’ issues and concerns. Mr. Stannard reported Mr. Dee Wahlers from the Environmental Commission had also attended.

Mr. Stout reported the Township is required to submit to the County its Wastewater Management Plan and that the deadline has now been moved to November, 2009.
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PUBLIC HEARING ON 2009 MUNCIPAL BUDGET

Mayor Stave opened the public hearing on the Proposed Budget for 2009 by stating it was part of a very long process. Over 20 hours of budget meetings were held and a lot of good feedback was received from the public. She added a lot of hard work with “sharp pencils” was done to cut out as much expenses as the Township Committee could to take a hard line on keeping our expenditures down and keep services at their usual outstanding performance, especially on the part of the staff. Mayor Stave thanked Christine Smeltzer, Township Administrator and Denise Marabello, Finance Director for putting this together. Mayor Stave reported that as a result of the hard work the tax rate will remain stable and because of the re-valuations some people will see their taxes decrease this year. Mayor Stave turned the meeting over to Ms. Marabello:

Following is the complete text of Ms. Marabello’s presentation of the proposed 2009 Budget:

“Good evening. Tonight we are here to adopt the 2009 Municipal Budget. This year’s budget was especially challenging for all of us due to the state of the economy. The decisions concerning this budget were a collaborative effort between me, the Township Committee, Administrator and the Department Heads. The Township Committee’s goal with the 2009 budget was to keep the municipal tax rate at a 0 cent increase while still maintaining the level of service that Cranbury residents are accustomed to. After many hours of discussion and analysis we have accomplished this goal.

The municipal tax rate in 2008 was .375 per $100 of assessed value and it will remain the same in 2009. Due to the housing market this year the Tax Assessor’s office was required to reassess 30% of the Township. This in conjunction with the settlement of tax appeals caused the total
assessed value to go down in 2009 by approximately $64,000,000. Revenues have decreased and the operating budget has increased from 2008 to 2009. During the course of this presentation these increases and decreases will be explained.

There are five major components to the Municipal Budget – Revenues, Appropriations, Debt, Surplus and Taxes. The 2009 total municipal budget is $11,345,187. This slide shows the breakdown of dollars by department.

The three areas with the highest expenses are public safety which is a contractual obligation, government related expenses which are mandated by the government and debt which we will discuss later on.

A large part of any municipal budget is salaries and wages. Cranbury Township has 36 full time and 37 part time people. 52% of the full time staffing is Police. 8% of the total staffing is for the Construction Department which is not paid for by tax dollars.

Another 8% of total staffing is for statutory positions. Currently our salary and wage budget has increased due to several factors:

First we are in police arbitration and therefore we have had to budget for 2 years worth of estimated increases.

Second all employees other than Police with medical benefits were given a 1.5% salary increase which is being used to premium share toward the cost of health insurance.

Third 2009 is an unusual year in that there are 27 rather than 26 bi-weekly pay periods. For those employees who are paid hourly it increases the amount of money they will earn in 2009.

Fourth we estimate overtime for Public Works in case of bad weather or an emergency. 2008 happened to be a mild year. However, we must always have enough overtime money in the budget if it becomes necessary to use it.

Fifth there is an increase in OT for the state mandated dog census
Sixth there is the retired Police Chiefs vacation and sick payout.
The Township administration realizes that these are difficult times and has made every effort to combine positions where necessary as well as analyzing if a position should be full or part time.

There are salaries and wages and then there are other expenses. 9% of the municipal total operating budget consists of costs beyond the control of the Township. These are state mandated expenses which are not offset by any State funding.

This next slide shows you the trend of the highest state mandated expenses – pension and library. As you can see the pension payments were non existent or minimal until the State realized the pension fund was in trouble. At this point the State required that the municipalities replenish the fund over a 4 year period. With the Library payment we are required by the State to pay a calculated amount to the Library every year. As you can see over the last 9 years this amount has increased by approximately $450,000.
The good news is that 14.5% of the total operating budget is offset directly by revenues. This means that these particular expenses in 2009 are not putting an additional burden on the taxpayer.

This brings us to our second component of the budget – Revenues. There are five revenue categories. Miscellaneous which includes bank interest, sewer service fees, fire fees, court fines and interest on taxes. Then there is State Aid which has decreased this year by $25,571. Grants which can be seen on the expense side as well as the revenue side. Special items of revenue which include hotel tax, franchise fees, sewer fair share. Construction indirect costs reimbursement and the reserve to pay notes or bonds. Lastly, there is the amount of money collected in taxes.

From the revenue trend it is obvious that the tax revenue will increase as other areas of revenue decrease. Cranbury was fortunate in 2008 to have secured a 4% interest rate with the bank on our cash accounts. This allowed for an increase in the Miscellaneous revenue in 2008 but is not anticipated to happen again in 2009. Also, State Aid will most likely not increase in the years to come. And with most of the building in the Township being complete there are no more sewer fair share payments or large construction permit fees. Therefore, in the future we must look to see if there are other ways we can increase our miscellaneous revenues if we want to keep taxes down.

The third component of the budget is debt. Cranbury Township’s picture of debt is a very good one.

Right now we are at a place where the amount of debt we can incur far exceeds the amount of debt we have outstanding. Which is why for the first time Cranbury Township was able to get the highest AAA bond rating from Standard and Poor’s.

To further help with debt this year we did a refunding of two bonds which will save us a total of $654,476 over the life of the bond. We also continue each year to pay down additional debt and to control capital spending which would further increase our debt.

A large portion of the debt we incurred in the past was for the purchase of land for Open Space and Recreation and Farmland Preservation. In just 9 years we have increased the acres per person for Open Space and Recreation by .05 and for Farmland Preservation by .07.

The fourth component to the Township budget is the use of surplus. In 2009 we are using $1,580,350 in surplus to keep the tax rate steady. This leaves the surplus fund with $3,352,650.
Major contributors to surplus are excess tax collections (i.e. added assessments), excess revenues and the cancellation of prior year reserves.

Unanticipated revenues play a major role in surplus. As you can see from the history on the slide the rise and decline of the two have a direct correlation. Unfortunately the declining trend for both will most likely continue. The days of major development in Cranbury are gone and with that there are no more large sewer connection fees. There are no more large added assessments. Also the sale of land at a profit is a thing of the past. With this in mind the Township Committee is carefully tracking the balance between the use of surplus with the replacement of surplus per year.

After revenues, appropriations and the use of surplus are calculated the Township arrives at the last component of the budget – the Amount to be Raised by Taxation. In 2009 that amount is $6,707,955 which equates to a local purpose tax rate of 37.5 cents. Combined with the 2 cent open space tax rate the total municipal tax rate is 39.5 cents.

As you can see the municipal portion of the tax rate is remaining steady.

Also, with the average assessed value of a house in 2009 being $635,781 the municipal portion of tax dollars from 2008 to 2009 has gone down slightly for the average assessed household.
Lastly, this pie chart brings it all together (a copy of this pie chart can be obtained by contacting the Clerk’s Office). This is how your 37.5 cent municipal tax rate is being spent. I believe this shows that Cranbury strives to maintain its quality services while allowing the Township to function in an environment with increasing expenses many of which are beyond our control. With the difficulties that lie ahead for the economy we have worked diligently to come up with a budget in 2009 that will help Cranbury to continue to grow while ensuring fiscal responsibility. This ends our 2009 budget presentation and if you have any questions we would be happy to hear them now.”

Mayor Stave asked for comments from the Township Committee. Mr. Stout stated he is pleased the Township Committee is keeping the tax rate the same as well as re-financing of bonds which
will save the Township over $600,000 in interest payments. This is a significant adjustment. Mr. Stout reported the one item that worries him the most is the one graph showing the relationship between unanticipated growth, revenue and surplus. The Township has had, unlike our Federal government, the magical ability to operate in a surplus and that has given it a lot of flexibility. However, those days are closing, and the Township is “now on the wrong side of the curve” in that unanticipated revenues are declining. He explained this is due to a slow down in building and a decline in buildable space. In addition, the State is further reducing its tax relief assistance and at the same time adding more unfunded mandates.

Mr. Stout reported he is pleased with the staff—for the first time the Township Committee has asked them to share in the costs of benefits. This year all full-time employees in the Township will receive a 1 ½ % salary increase and will give that increase back to the Township to help pay for their medical benefits. Mr. Stout reported the “pension catch up” is another State cost which is a huge cost to the Township. For years the State did not make municipalities pay into the pension system for its employees and now the municipalities have to make up those payments. As a result of this, the Township has had to pay triple the normal amount both last year and this year into the pension system for its employees. Mayor Stave stated she is pleased with the Budget. There will be no cuts in staffing either administratively or public safety. At a time when we are seeing a lot of municipalities cutting their staffing which compromises public service, we can be proud we are able to keep our staff employed.

Mayor Stave opened the Budget Hearing for public comments: Mr. Dietrich Wahlers, 33 Hagerty Lane, stated the Township has always been successful in the past with generating money to surplus from the Operating Budget. He stated he hopes this year the Township will be able to do the same. He added Ms. Marabello had indicated in her remarks that this year the Township would be tracking it and stated that information should be shared with the public. Mr. Wahlers also stated there are going to be decreases in the assessed values and the budget is particularly tight this year and raised his concern with the Township having problems. Mr. Stout urged the members of the public to go to the Township’s web site and look at the pie chart and presentation Ms. Marabello had given. He stated to please let the Township know if anyone can come up with any ideas on saving money. Mayor Stave reported she has received some feedback from residents and would like to offer those ideas: If the Township loses an employee either through retirement or they move on, there be no hiring or promoting done without Township Committee approval. There are certain positions that could be promoted without the Township Committee approval; however, given these tough economic times, we would ask that they be brought to the Township Committee for review. At some point as the year progresses a subcommittee be created to review the professionals just as the Township reviews its employees. Mayor Stave thanked the Library again for the $18,000 contribution recently to the Township from their surplus funds and for taking on so many community activities such as the Senior Center. Mr. Cody stated he is glad the Township kept the tax rate flat as it is very important and also pleased the Township Committee had “sharpened its pencils” in reviewing the Budget. Mr. Cody added he is concerned with spending which could tap into the Township’s surplus funds. Mr. Cody recommended before hiring anyone as a new employee, the Township needs to look to see if present staff can take on those duties instead. He also echoed Mayor Stave’s remarks concerning the Township’s professionals and added before hiring professionals, a Request for Proposals (RFPs) be done to make sure the Township gets the best services for the monies spent. Mr. Cody referenced this year a 40% increase in professionals’ expenses. Mr. Stout responded a lot of the increase was because of COAH issues and stated he, as a taxpayer, will support the Township spending money to defend its position in regard to COAH. Mr. Stout agreed with Mr. Cody as far as doing RFPs. Mr. Stout stated along the line of “efficiencies”, one item the Township should give some thought to is that if Town Hall really needs to be open five (5) days a week. He urged the Township to think about it perhaps making the hours more convenient for the residents who are not home during the day. Mayor Stave stated later on in the meeting the Township Committee will be adopting a resolution to study how the Township might become more sustainable environmentally resulting in the long term cost-savings not only in monies that may be available in green initiatives but what green initiatives the Township might take to lower its expenses such as utilities. She added we live in a time when we can no longer do things because that is how they have been done; we have to think “outside of the box” on every single initiative that we take. And, as Mr. Stout said, we welcome the residents’ comments and ideas. Mr. Cody stated he wanted to make it clear to everyone that the tax rate which is being discussed as remaining flat is only the Municipal tax rate. There are two (2) other tax rates; the School tax rate and the County tax rate which are both unknown at this time. Mayor Stave reported in the last nine to ten (9-10) years the Township has been able to preserve in open space (Township owned) more than ½ acre per resident in the Community. Factoring in how much farmland the taxpayer has helped to preserve (.07) the two combined is more than one (1) acre of preserved land per resident. She added that saves the Community by not having that land developed. Mr. Stout stated the Sustainability Plan is another way to make Cranbury Township shine. The fact that its “footprint” in that regard will look very good as the Township has done a lot to preserve open space. On motion offered by Mr. Stout, seconded by Mr. Cody, the following resolution was adopted by vote:
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http://www.cranburytownship.org/TC_minutes033009.pdf