ESSEX COUNTY, NJ — On Wednesday, Jan. 10, Essex County Executive Joseph DiVincenzo Jr. presented a proposed 2018 budget of $725.9 million that, according to a press release from the county, stabilizes the county’s financial plan and addresses challenges stemming from ongoing national economic conditions. According to the county, layoffs have been avoided since 2004 and budgets have been unveiled before the state’s statutory deadline of Jan. 15 for 15 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 in the press release. “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.”
DiVincenzo added that it is his goal to have Essex County’s bond rating elevated to a AAA rating. The county’s current bond rating was improved to Aa1 by Moody’s Investors Services in August, the eighth bond rating increase for the county since 2003.
According to DiVincenzo, his administration began preparing the 2018 budget in June 2017 and getting an early start enabled department and division directors, constitutional officers and county agencies 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.
In this proposed budget, several Essex County facilities will continue to generate recurring revenue through shared service agreements with other government agencies. The Essex County Correctional Facility is anticipated to generate $35.7 million in revenue by housing federal inmates, immigration detainees and inmates from Gloucester County; the Essex County Hospital Center is anticipated to generate $17.3 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 $2.5 million by accepting juvenile detainees from Passaic County.
The Essex County Parks Department is anticipated to generate approximately $15.4 million in revenue from admissions and user fees.
According to the county, $25 million in fund balance is being used as revenue in the 2018 budget. In addition, because of savings in the previous budget, the total fund balance will increase to approximately $78.7 million. This reserve helps the county respond to emergencies, and has helped improve the county’s cash flow and avoid taking out Tax Anticipation Notes for the last four years.
During the last seven years, Essex County has held the increase in property taxes to about 1.65 percent, which is under the state cap of 2 percent. During the last 16 years, Essex County has held the increase in property taxes to approximately 2.5 percent, which is the fifth lowest percentage rate of increase of all New Jersey counties behind Hunterdon, Monmouth, Burlington and Somerset counties, according to the press release.
In 2007, DiVincenzo implemented an initiative to stabilize the county’s debt service by refinancing existing debt without extending its maturity date and limiting the amount of new debt to a maximum of $20 million annually. In 2018, the debt service payment is $111.8 million, which is expected to be reduced to just $37.3 million in 2026.
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 16 years, Essex County’s workforce has been reduced from a high of almost 4,000 employees in 2003 to 3,550 in the 2018 budget proposal.
The 2018 budget proposal has been forwarded to the Essex County Board of Chosen Freeholders for review.