The Proposed 2008 Merchantville Municipal Budget
Including the Final Certification of State Aid from Trenton
You won't find the budget on-line anywhere but here!
On the pages linked below is the municipal budget as it was introduced at the 16 June 2008 Council Meeting. It is presented here unchanged and unedited in any way whatsoever, even though the first sheet (Sheet A) contains errors regarding who is on Council, and slow contains errors in the end-of-term dates for several Councilors and the Mayor (those errors are inconsequential, as they do not impact the budget, and they have already been corrected - I've seen, but have not received a copy of, the corrected cover sheet.
The first link is to a copy of the Final Certification of State Aid from Trenton, sent to all Councilors a couple of days after Governor Corzine signed the state budget. The numbers shown in it are, for all intents and purposes, "written in stone." There is an increase of $29,296 in Consolidated Municipal Property Tax Relief (CMPTRA) from earlier estimates for 2008.
I don't know where the Business Personal Property Tax Adjustment (table at the bottom of the Certification) enters into the budget - I can't find it in the body of the budget anywhere. I'll be asking our CFO to explain what effect that has on the revenue portion of the budget, and if I get an answer before the Council meeting of 14 July, where Council will vote on this budget, I'll try to post it here.
So the CMPTRA and the Business Personal Property Tax Adjustment will have some effect on revenue, and therefore on the amount needed to be raised by property taxes. Here's my layman's analysis of the budget (don't take this analysis as absolutely correct, but think of it more as starting point for your own evaluation. I don't understand the entire budget process; nor do I pretend to. I'm only a mathematician - BAMath, Carroll College, 1980 - I'm NOT an accountant).
A few points to keep in mind for the following analysis:
Property taxes are discussed in terms of pennies per one hundred dollars of assessed property value.
One cent of taxes over all the property assessed locally is called a "Tax Point."
A "tax point" in Merchantville is worth about $16,000 (that is, if the assessments on all taxable property in Merchantville increased by 1 cent, $16,000 in additional property taxes would be raised). Remember that number - we'll be using it to figure the rough increase in property taxes under this budget.
So let's look at the budget, without the changes shown in the Final Certification for now. What we need is almost all conveniently on Sheet 11. The only thing we need to know NOT on Sheet 11 is the Total General Appropriations, on the last line of Sheet 30.
By state law, the budget must balance. So the Total General Appropriations, this year's value being $4,405,684.97, MUST be offset to the penny by Revenues. If we go back to the last line on Sheet 11 (Line 7), Total General Revenues, we see that the anticipated value for 2008 exactly matches the Total General Appropriations - $4,405,684.97. That's a balanced budget. If we appropriate less, we need less revenue. If we appropriate more, we need more revenue. It's that simple.
There are all sorts of sources of revenue. Some of those are: State Aid, building permits, speeding tickets, etc, and the big one - property taxes. We can estimate all of these amounts, but we have little control over most of them - they are what they are, and even if we did have a great deal of control, most of them are relatively small (how many $25 dumpster fees would we need to make a dent in a four million dollar budget?!). By far the biggest single revenue element in the budget is property taxes (look over the revenue list on Sheet 11 and you'll see it). So in the end we take the Total General Appropriations, subtract all other sources of revenue, and this tells us what we have to raise in property taxes. That shows up on line 6a on Sheet 11. For 2008, that number in these budget sheets is $2,002,579.97.
Now the big question: what's our tax increase over last year going to be?
That's easy to figure: Take the anticipated 2008 amount and subtract from it the actual ("Realized") 2007 amount. We get $2,002,579.97 - $1,809,027.37 = $193,552.60 (Why used the actual, and not the anticipated, 2007 amount? Because that number is the taxes we really got with our 2007 tax rate, so it becomes the base from which to calculate the difference to get to this year's anticipated taxes).
Now we divide that number by $16,000 (the value of a tax point, remember?), to get the pennies per $100 value increase. It comes out to about 12 cents ($.012). About how much extra will YOU pay in taxes this year to the borough? Multiply .12 times the assessed (not market) value of your house and divide by 100. For a $100,000 house, the tax increase will be .12 X 100,000 / 100 = $120.00 per year. If your home's assessed value is more, your tax increase will be more. If it's less, your increase will be less.
But we have an increase in CMPTRA of $29,296 above the budget estimate, and the actual Business Personal Property Tax Adjustment payment to go to the school is $106,452 instead of the estimate, on Sheet 20a, of $96,856, an increase in that allocation of $9,596. Adding the $29,296 increase to the revenue side and adding the $9,596 increase to the allocation side, we wind up with total revenues on Sheet 11 Line 7 of $2,432,401.00. Total Appropriations, the last line on Sheet 30, now becomes $4,415,280.97. So we wind up with Line 6a of Sheet 11 going from $2,002,579.97 to $1,982,879.97.
Subtracting last year's actual amount and we get $1,982,879.97 - $1,809,027.37 = $173,852.60.
Calculating our new tax increase - $173,852.60 / $16,000 = $.109, or 10.9 cents. On our $100,000 assessed home, that's $109.00 a year. Now keep in mind that's an estimate, because our tax point isn't exactly $16,000 (it's actually a bit more than that).
Something else to keep in mind - the above does not include any school and county tax changes. They'll be added on top of our adjustments.
So after all that, here's the Final Certification of State Aid and the budget as introduced.
One other thing - you'll notice that the Capital Budget, Sheet 40, is blank. We have not done a 2008 capital budget as of this time. We started it but have not been able to complete it yet.
Mark B.
Final Certification of State Aid