UNION COUNTY, NJ — Last week the county introduced its 2015 budget, a $491.9 million spending plan that is $12.9 million less than last year, but still impacts the average taxpayer in the county by $52, or 2.51 percent more than last year.
The annual budget will require $335.2 million to be raised by taxes, compared to 2014 when it was $327 million. The amount to be raised by taxes is the amount the county must collect from property owners in order to sustain services and pay county employees.
Although the county uses $52 as the average amount taxpayers will have to hand over this year for county taxes, the final number is highly dependent on what town a property owner lives in and the assessed value of their property.
Also important is that tax bills are comprised of three parts – municipal, school and county. Only after the three-part bill has been tabulated and finalized, separately, will taxpayers have an accurate accounting of their total tax increase for 2015.
The introduction of the budget is just one step of a process that has several parts, including a May 14 public hearing. The hearing will take place at 6 p.m. at the county administration building in Elizabeth.
At that time citizens can voice their objections, prior to the freeholder board voting on the measure May 28.
Copies of the budget are available to the public at the county administration building, office of the Clerk of the Board.
This year salaries and wages for the 2,222.7 full- and part-time county employees came to $164.9 million, compared to 2014 when there were 2,519.7 employees paid $175.4 million. Overall, operating expenses for the county came to $326.9 million, which included debt service, deferred charges, and capital improvement projects, among other appropriations.
When salaries and wages were broken down, those receiving taxpayer dollars was, “general” government, $102 million; public safety, $92.1 million; operational services, $17.7 million; and health and welfare $110.3 million, which was the largest share of salaries and wages at 20 percent.
Hudak said the 2015 budget highlights the priorities of the board “with a strong emphasis on education and recreation.”
“The state of this year’s budget reflects a broad-based recovery in Union County’s economy and our success in setting goals, implementing policy and continuing progress in all areas requiring attention,” the freeholder said.
The freeholder explained that since county manager Al Faella presented his executive budget in February the finance committee was able to further reduce the proposed budget by $820,000 without any loss of jobs or impact of services to residents.
Hudak also pointed out that the county has been impacted by another year of decreased revenues, including the loss of $800,000 in red light camera fines, which was their cut from the municipalities that had these lights on during the five-year trial period that came to a halt at the end of 2014.
In 2015 the county will take in $136.6 million in revenue, compared to 2014 when that number was $180.3 million.
The freeholder also mentioned an increase in pension costs of $500,000, an increase in debt service of $5 million, which in part funded public investments in projects such as those undertaken at Cranford campus at Union County College and the new Family Courthouse Complex in Elizabeth.
However, Hudak mentioned that despite this the county has maintained a triple “A” rating with Moody’s investment Services, which he said is commendable.
Through negotiation and collective bargaining the county was able to offset health benefits by plan modification and employee contributions. Specifically the county will spend $63.3 million on group health benefits, including dental, for employees. Employees receiving health benefits, Hudak said, will also contribute $5 million towards their benefits in 2015.
“I think it is important that taxpayers know our employees were contributing towards their health benefits before the state made it mandatory in 2011 that they contribute a specific percentage,” Hudak said.
The finance committee chairman said the sale of Runnells Specialized Hospital in Berkeley Heights for $26 million not only brought revenue from the sale but will also “save millions more each year on mandated costs such as health and liability insurances, pension and operating costs.
Prior to the sale the county was subsidizing the facility by about $13.5 million every year. In fact, in order to keep the hospital afloat, the county spent $30 million in just the last two years.
The question of what the county did with this $26 million windfall has surfaced and Friday in an interview with LocalSource Hudak explained the state carefully oversees how that money is spent.
“The Runnell’s sale money has its own line item in the budget,” he said, noting that a portion of the proceeds is set aside and held in trust until the approximate $4.5 million in debt service for building the facility and making improvements over the years is paid off. This is mandated by the state, he noted.
Hudak said the county has taken a “prudent path” to avoid a one-shot approach in spending the revenue from the sale of Runnells, which in the long run will offset taxes for years to come.
“This will prevent a larger shortfall in future years,” Hudak said.
The county has earmarked a small amount of the Runnells money in 2015 for an initiative that will be of help to municipalities.
This is the first time the county will be offering a $1.5 million matching grant program called the “Union County Infrastructure and Municipal Aid” incentive to municipalities that can be used for a variety of improvements.
Included in the projects that towns can apply to the county for matching grant money were economic development projects, downtown development, large and small construction projects, community enhancement projects, transportation improvements, pothole repair and child and senior center infrastructure projects.
“This type of matching grant is something the state and federal government has been negligent in providing,” Hudak said, admitting that the amount was not as high as it needed to be but “it’s a start.”
The finance committee chairman said the county was able to boost surplus by 71 percent because their financial circumstances improved. Right now, according to the budget introduced by the freeholder board, that number stands at $20 million, but that does not include revenue from the sale of Runnells because that number is required by the state to be a separate line item in the budget.
“With all this ahead, we have much to achieve in 2015 and we are ready to roll our sleeves up and get to work,” Hudak said.