Budget holds line on taxes with no layoffs, service cuts
NORTeAMPTON TOWNSeIP – cor the fourth year, the township will hold the line on taxes.
rnder the township’s preliminary $28 million budget, passed unanimously by the board of supervisors Nov. 15, the tax rate of 11.1425 mills will remain unchanged next year.
Taxpayers with property assessed at the median value of just over $35,000 will continue to pay $397, or about 8 percent of their total tax bill for township services.
crank Rothermel, chairman of the board of supervisors, commended the township administration and department heads for “sharpening their pencils” and presenting a budget that holds the line on taxes while retaining the current level of service with no layoffs.
rnder next year’s budget, general fund revenue is projected at $13.2 million, an increase of $600,000 over 2012.
Nearly half of those funds, about 47 percent or $6.5 million, will come from the earned income tax.
Township manager Robert Pellegrino said while the township saw a reduction in its earned income tax in 2009, “since that time we have climbed up out of the hole and we’re seeing reasonable increases in that revenue source. It’s not large,” he said. “We’re projecting about two percent next year.”
While earned income is on the rise, the townVKLS FRNWLNUHV WR VHH flDW UHVHNUH IURP WKH WUDNVfer tax, the money the township receives when a home is sold in the township. cor 2013, the EUGJHW SURMHFWV $700,000 WR flRW LNWR WRWNVKLS coffers.
At its high point in 2006, the township was collecting $1.5 million from the tax. “We’ve had to absorb that loss of revenue, not just this year but since 2008. Normally we would have over 600 properties transfer. It’s half of that amount right now,” Pellegrino said.
There are glimmers on the horizon that the housing market is starting to pick up, said Pellegrino, “but we are being conservative and budgeting the same as 2012. If it comes in more, that’s great. We’ll enhance our reserves.”
Another variable in the budget are permit fees, which change from year to year based upon the amount of building taking place, said Pellegrino. “Those are down, but with a number of institutional projects we’ve seen this year our permit fees are over budget and we’re estimating about the same amount in 2013.”
Also budgeted is a $200,000 balloon payment on the Spread Eagle Inn in 2013 and $90,000 more in real estate revenue due to a shift in millage from the debt service fund to the general fund.
A major area of concern continues to be the township’s real estate assessment, which has steadily declined since 2010, from a high of
$599 million in 2009 to a projected $575 million in 2013. The decline has resulted in a reduction of $260,000 in tax revenue to the township, said Pellegrino.
“It’s been a steady decline. We haven’t felt it all at once, but it has had an impact over the term that we have had to deal with,” he said.
On the expenditure side of the ledger, 75 percent of the budget will pay for personnel, while nine percent will fund insurance, utilities, contracted and professional services.
Non-union employees are budgeted to receive a two and a half percent salary increase in 2013 WKLOH SROLFH RIfiFHUV WLOO JHW D 3.5 SHUFHNW ERRVW in their wages after forgoing a salary increase this year.
)RU WKH fiUVW WLPH NHXW YHDU, WKH WRWNVKLS WLOO be picking up the entire tab for its four full-time GDYWLPH fiUHfiJKWHUV DW D FRVW RI $500,000. ,W WLOO also be absorbing $500,000 in pension cost increases.
rtility costs are down due to the township’s work to reduce its energy consumption. But Pellegrino said the budget includes a three percent increase in the event rates go up next year.
The township will also be paying more for workman’s compensation, projected to be up by eight percent.
Other costs outside of personnel are projected to be at or below 2012 levels, according to Pellegrino.
Capital projects slated for 2013 include the continuation of the township’s energy reduction program, replacement of police vehicles, the purchase of ballistic vests as needed for its police department and replacement of a 1991 dump truck, a 1976 mower and two smaller trucks.
Other planned expenditures include software for permits management, updating the recreation component of the comprehensive plan, completion of the native gardens, a battery backup systems and generator connections at township traf- fiF VLJNDOV, PLNRU EULGJH UHSDLUV, LPSURVHPHNWV to the bathrooms at The Shack and 3.2 miles of road repaving projects.
Pellegrino initially recommended a tax increase to plug a funding gap in the library budget and to pay for capital purchases.
With the township’s capital reserve fund exhausted, he suggested the creation of a new funding stream - road equipment capital fund of .46 mills - to pay for the replacement of “old equipment” that, he said, in some cases is “falling apart.
ee also suggested a .2 mill increase to shore up the library fund balance and operations.
The remaining .34 mill difference would supplement the capital equipment reserve fund for new police cars, computer equipment, building maintenance, etc.
“That was my initial thought,” said Pellegrino. “I still believe that at some point we’re going to have to address those concerns.”
Pellegrino said he was able to avoid the increase by budgeting the sale of the Richboro Schoolhouse in 2013 to fund some of the township’s capital needs for 2013.
Pellegrino said adjustments were also made to its revenue projections. “Our projection for the earned income tax was very conservative. We are now less conservative,” he said. “We made up some money there that will fund the library operations.”
“The board is solidly behind your recommendations,” Supervisor deorge homelasky told Pellegrino. “rnfortunately we just don’t think this is the time we can implement it. With all the things people have had to go through the past few years we should be looking at needs and not wants.”