BOT introduces $36.8M budget

SOUTH ORANGE, NJ — The South Orange Board of Trustees introduced the 2020 budget at its virtual May 11 meeting, passing the $36,873,694.78 budget, in which municipal taxes will be raised by 2.72 percent, on first reading with a 5–0 vote. The average increase between 2011 and 2020 has been 1.8 percent, while the average increase from 2000 to 2010 was 5.75 percent. This year the tax increase for the average homeowner in South Orange will be $143. Trustee Donna Coallier abstained from voting.

“That first 10 years we had an average tax rate of 5.75,” Business Administrator Adam Loehner said at the meeting. “In the last 10 years we were around 1.8. This is a true testament to the board that we’ve had in the recent past to really keep our tax rate low and keep everything under control with our spending.”

The presentation provided a breakdown of where South Orange taxpayers’ money goes; the highest amount, 57 percent, goes to the South Orange–Maplewood School District. The municipality receives 26 percent of the tax dollars, Essex County gets 16 percent and a reserve of 1 percent is set aside for uncollected taxes.

Salaries for municipal staff, not including public safety, totals $4,997,176. The South Orange Police Department salaries will cost $6,486,610, and the salaries for the South Orange Fire Department will cost $3,833,900. According to the budget presentation, 40 percent of South Orange’s revenue goes to the police and fire departments — the largest percentage of the total revenue.

Other expenses in the 2020 budget include the shared municipal court with Maplewood at $500,000; the $135,000 capital improvement fund; $5,494,090 for municipal debt services; and a $1,350,000 reserve for uncollected taxes.

In the revenue section of the budget, there is an anticipated surplus of $1,577,000. Receipts from delinquent taxes will bring in $860,000. South Orange will make $480,000 in uniform construction code fees, in addition to receiving pedestrian safety, Sustainable Jersey, Open Space Stewardship and Nature Conservancy grants.

Because of the COVID-19 pandemic and the resulting negative economic effects, the budget presentation showed the anticipated revenue loss South Orange could see in the coming months. Uniform construction fees will lose $320,000; money that will be lost from court fines and cost will be $363,500; and interest on investments and deposits will lose $187,500. Fees and permits issued by the clerk’s office and the Department of Public Works will lose $27,836.

If summer camp isn’t held as planned this year, it will be a loss of $347,357. The same goes for the opening of the Peter S. Connor Memorial Pool, which will lose $184,545. Spring recreational sports, which have been unable to hold their 2020 seasons, will lose $179,480. Uncollected taxes in 2020 will cause South Orange to lose $250,000.

“We are having to change the way we do business going forward with social distancing,” Loehner said. “So the camp, the pool and recreation sports are all taking quite a big hit. We’re not exactly sure how all of those are going to play out; we’re waiting for a lot of direction from the state, but as we get more information, we’re going to be able to progress and see what we can do. We are anticipating a pretty big loss in that.”

Resulting from the potential loss of $1,860,218.75 because of COVID-19, cuts had to be made to the 2020 budget. Six new hires were going to be made in the SOFD; there will instead be only three, saving $150,000. The number of SOPD hires will also decrease, saving South Orange $112,500.

A deputy engineer, community development coordinator, part-time events coordinator in the recreation department and part-time administrative assistant in the building department were also supposed to be hired. Not creating those positions this year will save the village $235,000.

“We reduced our capital expenses,” Loehner said when talking about things South Orange has already done to compensate for the lost revenue. “There were things on our capital expenditures that we were going to do this year, and we’re going to push them off a year.”

Money has been saved by not using police overtime or part-time crossing guards as well.

“Because school has been closed for the rest of the year, we haven’t needed the crossing guards,” Loehner said. “We’ve also seen a drop in our overtime. We had a light snow year, so public works had extra overtime that we were able to give back as part-time laborers. We haven’t hired any part-time laborers during this time; once we get back up and running and get everything going, we’ll probably bring part-time laborers in, but we were able to save some salary costs there.”

In addition, Loehner said the village asked its employees for a two-year salary freeze at 2 percent. South Orange will be working with its bargaining units on the plan, but if that doesn’t work out there is also a layoff plan.

“All of us are making sacrifices, and we wanted a way that employees could also give back to the village and help minimize the impact of the budget, so we have asked for a 2-percent freeze,” he said. “The total for that would be $476,000 over two years.”

Final adoption of the 2020 budget is scheduled for the BOT meeting on June 8, where a public hearing will also take place.

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