NEWARK, NJ – On Wednesday, Jan. 11, Essex County Executive Joseph DiVincenzo Jr. presented a 2017 budget of $715.3 million. This budget is intended to stabilize the county’s financial plan and address challenges caused by ongoing national economic deficits. Layoffs have been avoided since 2004 and budgets have been unveiled before the state’s statutory deadline of Jan. 15 for 14 consecutive years.
“Every year we are faced with a variety of challenges that affect our county. By starting our planning process early and presenting our budget by the Jan. 15 statutory deadline, we are able to create a strong groundwork and sound financial plan for our department and division directors and constitutional officers to follow throughout the year,” DiVincenzo said, according to a press release from the county. “Presenting our budget by Jan. 15 is important because it gives our municipal partners and constituents a clear snapshot of what to expect from the county.”
The county executive added that it is his goal to have Essex County’s bond rating elevated to a AAA rating. Its current bond rating is AA2 with a positive outlook, which is the highest it’s been in decades.
According to the release, the county monitors the budget throughout the year and began preparing the 2017 budget in May 2016. Getting an early start enabled county personnel to identify and address issues, investigate ways to reduce expenses and generate new revenue, and have a plan in place by Jan. 15.
“This rigorous planning and constant vigilance has helped us to respond proactively when we are faced with challenges brought on by the national economy, unexpected events or new laws,” DiVincenzo said.
The 2017 budget proposal maintains the county executive’s initiative to stabilize the county budget and strengthen the county’s finances. Approximately $13 million in savings was achieved by switching to the State Health Insurance and Prescription Plan, which offered more attractive rates than the county’s former employee health insurance provider.
Several Essex County facilities continue to generate recurring revenue through shared service agreements with other government agencies, according to the release. The Essex County Correctional Facility is anticipated to generate $36.8 million in revenue by housing federal inmates, immigration detainees and inmates from Gloucester County; the Essex County Hospital Center is anticipated to generate $14.8 million in revenue through reimbursements from the state for admitting patients from the state, and Passaic and Middlesex counties; and the Juvenile Detention Facility is anticipated to generate $3 million by accepting juvenile detainees from Passaic County.
The Essex County Parks Department is anticipated to generate approximately $14.9 million in revenue from admissions and user fees. A “snow bank” and “mosquito control reserve” continue to be maintained. These dedicated accounts have funds set aside for their specific purposes and allows the county to respond to emergencies without making additional appropriations or budget transfers.
The release stated that $15 million in fund balance is being used as revenue in the 2017 budget. In addition, because of savings in the previous budget, the total fund balance will increase to approximately $77.2 million. This reserve helps the county respond to emergencies, displays fiscal stability to bond rating agencies, has helped improve the county’s cash flow and allowed the county avoid taking out tax anticipation notes for the last three years.
Additionally, $5 million of fund balance is being used for IT upgrades and heavy equipment purchases.
During the last five years, Essex County has held the increase in property taxes to about 1.8 percent, which is under the state cap of 2 percent.
In addition, open positions have been unfilled, unless they are essential to public safety and public health operations. This includes positions such as nurses at the Hospital Center or corrections officers at the Correctional Facility. During the last 15 years, Essex County’s workforce has been reduced from a high of almost 4,000 employees in 2003 to 3,550 in the 2017 budget proposal.
The 2017 budget proposal has been forwarded to the Essex County Board of Chosen Freeholders for review.