Borough Tax Levy to be Within Allowable Limit

When Administrator Robert Falzarano presents the 2012 budget to the borough council Monday, residents will notice a few changes.

The 2012 tax levy will be over the two percent state cap, but the borough does get various excemptions to the cap for cost increases such as pensions and health care.

Council President James Lonergan, who sits on the borough's Finance Committee and has spoken about the budget on behalf of the committee and Falzarano, said the tax rate will be within the allowable exceptions, negating a public vote on the budget.

Utility Usage Rates

In the past, 15 percent of utilities such as water and sewage was collected within the general tax, which helped keep rates low. The remaining 85 percent was paid for based on usage.

Beginning in 2012, however, Lonergan said 100 percent of such utilities will be charged completely on a usage basis.

Lonergan said the 15 percent of utility costs is now "that much less in taxes that [residents] have to pay out of their tax base. You'll start to see that more and more things will be usage-based, to keep taxes lower."

The rate of sewage fees for 2012 wil be voted on as a resolution Monday night. The resolution as currently drafted sets the fees at $3.45 per 100 cubic feet of water. According to Lonergan's presentation on Feb. 13, water fees will be $3.86 per 100 cubic feet of water.

State Aid

When , Lonergan learned the borough's state aid will remain at $572,099, the same it was in 2011. Lonergan said the Finance Committee budgeted for the same amount of state aid, but the decrease in aid from previous years still creates a burden for the borough.

"I read that write-up [from the state] and it sounded like a sales pitch," Lonergan said. "Keeping it level from last year, that's not a positive for the Borough of Chatham. ... Keeping it flat from something that's down 35 percent from where it was a few years ago that's not making anybody happy."

The chart below shows state aid from 2009 through 2012.

The borough's overall budget has declined by six percent in past years and Chatham Borough's tax levels are the fourth lowest in Morris County.

Lonergan described much of the 2012 base budget as "weather-driven," and the borough "couldn't have been hit worse" in 2011. The , and cost the borough greatly, and the "incredibly wet summer," Lonergan said, drove down revenues usually brought in from water and sewer usage.

The year 2011, though, is only part of the puzzle. "The challenge that we are faced with," Lonergan said, "is what we're seeing as a multi-year revenue decline. The amount of income coming into the town continues to drop."

The drop comes as residents get their homes reassessed to lower their property taxes as the economy continues at a slow pace.

At the same time, the borough has been forced to correct infrastructure problems "that have not been addressed for 16, 17, 18 years," Lonergan said, and "the demand [for] exceptional services remains."

The council meets at 7:30 p.m. at the . A full agenda may be found in the photos section of this article.