2021 BOROUGH OF MAYWOOD Budget Requirements Presentation BOROUGH

2021 BOROUGH OF MAYWOOD Budget Requirements Presentation

BOROUGH OF MAYWOOD 2021

Overview • • • Annual Budget Requirement Budget Calendar Revenues and Appropriations Budget Capital Budget Statutory Requirements Transfers Emergencies Audit QUESTIONS

Annual Budget Requirement • Each Year every New Jersey Municipality must Introduce and Adopt a Balanced Municipal Budget. N. J. S. A. 40 A: 4. • Municipal Appropriations Only • Tax Rate Established: • Local • School • County.

Proposed Budget Calendar 2021 • March 30, 2021 Formal Budget Introduction • April 30, 2021 Budget Adoption • Tax information to the • County Board of Taxation • 15 days after Adoption

Revenues and Appropriations • Revenues: • • Fund Balance Miscellaneous Revenues State and Federal Aid Real Estate Taxes Rule: Cannot anticipate any miscellaneous revenue greater than what was received in the prior year, unless new revenue is supported by proper documentation and approved by the Division of Local Government services.

Appropriations • Appropriations are the authorizations to expend budget dollars in support of government operations. • Rule: Expenditures can only be made through valid procedural process, authorized by the Department Heads and the Township Administrator.

Budget Process • Preparation: • • Administrative Preparation Governing Body Approval Implementation Accounting and Financial Reporting

Budget Process • Administrative Preparation: • Mayor, Administrator and Department Heads develop and request budget appropriations and Capital Needs to operate their Departments for the new year. Maintaining the level of service to the taxpayers and residents, or changing the programs to accommodate anticipated changes to the municipal environment

Budget Process • Administrative Preparation: • That information is provided to the Chief Financial Officer who prepares the Budget Workbook which provides a first look at the requested budget in relation to the statutory requirements and the calculation of an estimated tax impact to the taxpayers.

Budget Process • Governing Body Approval: • The Budget Workbook is presented to the Governing Body through its Finance Committee, who reviews and interfaces with the Administration regarding any changes or adjustments they would like to see related to the Budget and Capital Program. • Once this process is complete the Workbook is presented to the entire Council for review and questions, and a date for introduction is selected.

Budget Process • Governing Body Approval: • The Budget and Capital plan is formally introduced by the Borough Council and a formal vote is taken. • The Budget is then advertised for the public to review and a public hearing and adoption date is established. • At the time of the Budget Hearing, after public input the Governing Body may amend or accept the budget as introduced. • A formal vote is taken, and the budget is adopted.

Budget Process • Implementation: • The Adopted Budget and Capital plan is then sent to the Administrator and Department Heads to implement and operate the municipality as directed by the Governing Body’s actions in the Budget approval process and in accordance with statutory requirements and the Local Public Contracts Law. • Any adjustments or amendments to the Budget after adoption are required to be approved by the Governing Body.

Budget Process • Accounting and Financial Reporting: • The Chief Financial Officer and the Tax collector are required to prepare and maintain expenditure and revenue books of original entry respectively. • There financial records will be presented for independent audit annually at year end.

Budget Cap’s • Established in 1977 - 5% Cap on Appropriations • Lots of Amendments • 2021 Appropriations Cap- 2. 0% • 2021 Tax Levy Cap 2%

Budget Appropriations Cap Law • N. J. S. A. 40 A: 4 -45 • Final CAP Appropriations shall be prohibited from increasing by more than 3. 5% or the index rate, which ever is less over the previous year. • • 2021 CAP rate 2. 0% Exceptions: 1. 5% CAP Municipal ordinance Referendum

TAX LEVY CAP • Levy Cap on Municipal Property Tax • Chapter 44 P. L. 2010 • Property Tax Levy Caps N. J. S. A. 40 A: 4 -45. 44 through. 47 2% levy cap on municipal, county, solid waste districts, and fire district tax levies Introduced budgets must be cap compliant

Capital Budget Plan 2021 A Capital Budget is a required part of the Annual Budget for all Municipalities in the State of New Jersey. N. J. S. A. 40 A: 4 -43 provides that this budget is A plan for the expenditure of public funds for Capital purposes. The Authorization to make the expenditure still requires a Capital Ordinance adopted by the Township Council for each specific project.

Capital Budget addresses the needs of the Township’s infrastructure and equipment requirements. These authorization are categorized in two types. Capital Improvements and Capital Purchases.

Capital Purchases encompass Acquisition of goods and services that have a useful life of more than 5 years. For Example: Acquisition of DPW Trucks Purchase of Radio Systems Capital Improvements encompass Construction projects which have a useful life of more than 5 years. For Example: Repaving Streets Additions to Municipal Facilities

Capital projects generally are presented to the Governing Body by the Borough Professionals, and Department Heads during the annual budget process. The Capital Budget is approved at the time of the Annual Budget approval. The approved list of capital projects are sent to Bond Counsel for preparation of each specific ordinances authorizing the project and the funding. Each ordinance is then introduced and approved by the Governing Body.

Once the Capital Ordinance is adopted by the Governing Body, the authorization to issue debt to fund the project is given to the Chief Financial Officer, Bond Counsel and Borough Auditor to act on behalf of the Borough. A Capital Ordinances can be amended by action of the Governing Body only. It requires an introduction of an Amending Ordinance and the approval of the Amending Ordinance by vote of the Governing Body.

Statutory Requirements: • The Governing Body-Introduction and Approval • Public Advertising • Public Hearing • Amendments at Public Hearing • If Required • Adoption- 4 affirmative votes required to pass the Budget.

Transfers • Current Budget-November 1 to December 31 of the Budget Year • Requires a vote to Approve by the Governing Body

Emergencies • Unanticipated events which require expenditures in support of the operation of government. • Declared by the Mayor or Emergency Management Coordinator • Funded by the Borough Council, through Emergency resolution-passed by 2/3 vote • Raised in the subsequent years Budget

Audit • Required by N. J. S. A 40 A: 5 -9 • Annual Audit of each Municipality is conducted by an auditor who holds an un-canceled license as a Registered Municipal Accountant of the State of New Jersey. • Borough Auditor- Steven Wielkotz-RMA

BOROUGH OF MAYWOOD QUESTIONS ?