Category Archives: State aid cuts

>Middletown’s Take on the Budget, with Comments

>The following press release was posted on Middletown’s website yesterday. The press release is the Township’s take on the newly adopted budget as usual it is a great spin job and very deceptive because no matter how you slice it, the municipal tax rate has been increased by nearly 12%. I would also point out that what’s in the press release is bull:

Township officials adopted an amended $64.7 million budget that reflects ongoing efforts to cut costs and keep the tax rate stable by cutting spending an additional $400,000.

“This year’s budget reflects a reduction of 40 staff positions, a salary freeze and across-the-board reductions in departmental operating budgets,” said Mayor Gerry Scharfenberger. “In sum, the Township’s amended budget represents a 2.67% increase in total property taxes in an extraordinarily difficult economic year.”

Under the amended budget, the municipal tax rate will increase 4.6 cents to 39.75 cents per $100 of assessed value. This equates to approximately $17 per month for the average Township home assessed at $435,000.

“This year, municipal taxes represent just 23% of a resident’s tax bill, with 62% being levied for schools and 15% for the county,” concluded Scharfenberger.

The adopted budget addresses nearly $10 million in lost revenue, including:

  • $1.6 million cut in state aid.
  • $1.4 million obligation for retroactive pay under resolved labor contracts.
  • $1 million in increased health care costs and nearly $1 million in deferred excess claims from 2009.
  • $900,000 for extraordinary snow and storm clean-up.
  • $1.8 million in deferred pension payments mandated by the state.
  • $1 million in property tax appeal refunds.
  • $400,000 in lost recycling revenue.

Here’s my response:

  1. Middletown knew a state cut in aid was coming, as did every half wit in the State. State revenues were down like $4.0 billion.
  2. Middletown could have easily predicted the wage increases in unresolved contracts. Unless we negotiated zero percent increases for 3 years, we knew this was coming. Again, very predictable.
  3. On health care costs, Middletown knew they underbudgeted by at least $800,000 in 2009, since they did an emergency appropriation (none of our neighboring towns had to do this). So, Middletown started $800,000 in the whole, and Middletown knew they had to increase their appropriation for 2010 by around $1,000,000. Hello. Not to hard to foresee.
  4. $900,000 for snow plowing. Middletown only budgeted $165,000. The town cut the 2009 snow budget way too much, gambling that we would not have snow.
  5. Deferred pensions. Is Scharfenberger kidding? He voted to defer the pension payment. Sean Brynes and Patrick Short voted no. He knew in May 2009 that we would have to pay this in 2010
  6. The $1,000,000 in tax appeals. I don’t know about this one, I don’t think it’s even in the budget.
  7. Recyling lost revenue is correct, hey Schary got something right.
And here’s yet another way to show how misleading this press release is:
The tax rate, last year was $0.35 per $100 assessed value. A home valued at $435,000 would be required to pay $1,526.85. I have a home with an assessed value of $420,000 and paid over $6K in taxes last year.

Under the new tax rate of $0.3975 I will have to pay $1,729.13. This is an 11.7% increase no matter how you look at it.

Using some of the figures presented below:

Last year rate * this year increase = new tax rate
.35 * .0267 = 0.359345 or almost $0.36 per $100 assessed value

This year rate – last year rate = difference or this year increase
.3975 – .35 = .0475

This year increase / this year rate = percent increase
.0475 / .3975 = 11.95%

Amended budget – last year budget = difference
64.7M – 61.8M = 2.9M

Increase in this year / total budget = percent increase in overall budget
2.9M / 64.7M = 4.48%
The numbers are definately being misrepresented at best.

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Filed under adopted budget, budget introduction, Gerry Scharfenberger, Middletown NJ, Patrick Short, press release, Sean F. Byrnes, State aid cuts, tax appeals, tax increase

Patrick Murray: Conflicting Polls on the Teachers’ Union? Not Really.

Patrick Murray, who is the founding director of the Monmouth University Polling Institute and is a frequent media commentator on politics and public opinion, has posted on his blog an explanation for the seemingly conflicting poll results that were released last week dealing with Governor Christie’s budget, school aid cuts and state unions. He points out that even though the three polls seem to tell conflicting storys. they don’t. The separate polls “really tell separate pieces of a cohesive – but nuanced – story.”

Here’s what he has to say:

A trio of polls were released last week on Governor Chris Christie’s budget, particularly focusing on school aid cuts and state unions. According to at least one report, these polls were “seemingly at odds” with one another (also here). But if you look at what the three polls actually asked, they really tell separate pieces of a cohesive – but nuanced – story.

The Eagleton Poll (and here) found 57% of New Jerseyans feel that school aid should not be cut and 72% are opposed to “making it easier” to lay off teachers to solve local budget problems.

The Monmouth University/Gannett New Jersey Poll found 68% of the public see the cuts as being unfair to some groups (with teachers being among the top “victims”) and Governor Christie is seen as the more negative party in the NJEA dust-up, and ultimately more responsible for the impending teacher layoffs.

The Rasmussen Poll found 65% of likely voters favor having school employees (including teachers, administrators and other workers) take a one year wage freeze to help make up for the deficit in state funding.

I really don’t find anything too contradictory in those results. Public opinion is rarely black and white (as national polling about the health reform debate dramatically illustrates). The real difference in these three polls is that each chose to cover a different facet of the issue.

Both the Eagleton and Monmouth polls asked residents about their opinion of the governor’s proposed budget and how it will affect them personally.

Eagleton also asked quite a few questions about what areas of the budget should or should not be cut and what, if any, tax increases the public is willing to accept in order to avoid those cuts (none, apparently).

Monmouth’s survey included questions on impressions of Christie’s budget in comparison to Jon Corzine’s first budget (trends are a wonderful tool for providing context) and a focus on communication with the general public, including the NJEA battle and reaction to key terms used to describe the budget (e.g. “tough” and “fair”).

Rasmussen’s poll asked four questions, mainly focused on state worker concessions to deal with the budget crisis.

In terms of election polling, Rasmussen has a very good track record and, by my reckoning, had the most accurate final pre-election poll in last year’s gubernatorial race. [And admittedly, Monmouth, along with Zogby, YouGov, and Democracy Corp, came up with the wrong end of the stick in the final days of that campaign. Eagleton did not issue a final election poll.]…

You can read more >>> Here

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Filed under Gov. Chris Christie, Monmouth University, Monmouth University / Gannett New Jersey poll, Patrick Murray, State aid cuts, Teachers, unions

"State budget cuts aid to all but three towns", can Middletown now pass it’s budget?

It is being reported on NJ.com today that all but three of New Jersey’s 566 cities and towns will see their state aid shrink under the state’s new $32.9 billion budget and not one of the three lucky towns is Middletown.

This is unfortunate for the residents of Middletown because it will contribute to the tax increase in this years budget. This news however was not unexpected, it finally means that the Republican majority that control the Township Committee can finalize and adopt the operating budget that is now 6 months over due.

The Republican majority kept holding out hope for state aid that they had been told would never come, now whatever budget savings were in place are almost certainly gone due to all of the temporary budget appropriations that where needed to keep the town running.

Click on the headline to read the story.

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Filed under Budget, Middletown, Middletown Republicans, State aid cuts

>"State budget cuts aid to all but three towns", can Middletown now pass it’s budget?

>It is being reported on NJ.com today that all but three of New Jersey’s 566 cities and towns will see their state aid shrink under the state’s new $32.9 billion budget and not one of the three lucky towns is Middletown.

This is unfortunate for the residents of Middletown because it will contribute to the tax increase in this years budget. This news however was not unexpected, it finally means that the Republican majority that control the Township Committee can finalize and adopt the operating budget that is now 6 months over due.

The Republican majority kept holding out hope for state aid that they had been told would never come, now whatever budget savings were in place are almost certainly gone due to all of the temporary budget appropriations that where needed to keep the town running.

Click on the headline to read the story.

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Filed under Budget, Middletown, Middletown Republicans, State aid cuts