TOWNSHIP OF BERKELEY HEIGHTS 2021 MUNICIPAL BUDGET PRESENTATION

TOWNSHIP OF BERKELEY HEIGHTS 2021 MUNICIPAL BUDGET PRESENTATION BUDGET INTRODUCTION April 6, 2021 1

MAIN GOAL of budget in 2021 amidst COVID-19: To provide the residents of Berkeley Heights with a budget that maintains the level of services they are accustomed to without a significant tax increase at a time when some may be financially impacted by the pandemic, and to anticipate near-future needs of our town with increased development: COVID-19: Extraordinary Budget Challenges for BH 2020 budget included one-time revenue of $475, 000 for Connell Park’s expanded liquor license. Hotel tax revenue continues to be negatively impacted in 2021. In 2020, Twp departmental costs were reduced due to COVID 19 staffing issues and to meet our goal of not increasing taxes. For 2021, department heads worked with Administration to review all costs and only request items that are essential and without, would reduce level of services to residents. Certain capital items are being funded out of current operations to better manage our debt service. 2

2021 ESTIMATED TAX IMPACT: 3

ESTIMATED 2021 TAX LEVIES: How your tax money is distributed All of the above revenue sources are collected by the Township, but only the Township and Library levy are included in our current fund budget. Township has no control over County or School levies, meaning, if we don’t collect taxes, the municipal payments to those entities are still due. The Township levy is the only budget we control. 4

2021 ESTIMATED TAX LEVIES: 5

BUDGET PROCESS: Budget process starts in October when all departments are given budget packages and deadline for submittal of budgets to CFO examines each Department and every line-item within each Department in order to pre-determine which items are fixed in nature (i. e. contractual obligations, professional services agreements, statutory requirements, etc. ) Administrator and CFO hold various meetings with Department heads to discuss current year progress and adjustments as well as future needs and requests Administrator and CFO work with Mayor and Council Finance Committee to prepare a proposed preliminary / draft budget for presentation to the Mayor and Council in February and March in public meeting Administrator and CFO work with department heads to make changes to budget based on the input from council, and present revised budget to council finance committee. 6

Benefits of a Cap Bank: BUDGET CHALLENGES: 1977 Cap Law – Appropriation Cap: Cost of Living Cap Adjustment (COLA): “Municipalities and counties shall be prohibited from increasing their final appropriations by more than 1%. . . ” Exceptions include: Grants, debt service, capital improvements and reserve for uncollected taxes Helps Twp responsibly plan for unforeseen expenditures. “Banks” = amount by which Towns can increase taxes and/or appropriations if needed; appropriations cap banked for 2 years, levy cap can be banked longer. Governing body may, by ordinance, increase final appropriations by 3. 5% and establish a cap bank (for up to two years) for the difference between its final appropriations and the 3. 5%. 2010 Cap Law – Levy Cap: Levy Cap Law, where the Municipal Tax Levy (not including Library) may not increase by more than 2% Having the bank does not mean Twp will definitely use it; in the recent past, it has only been used to cover health insurance-related costs in BH. The Levy Cap Calculation contains some exclusions, additions, and adjustments. Exclusions: pension increases, LOSAP increases, allowable health care cost increases, Capital Improvement fund increases, Debt Service, etc. Additions and Adjustments: New Ratables, CAP bank approved by referendum 7

COST REDUCTION EFFORTS – SHARED SERVICES: The Township achieves efficiencies of scale through Share Service Arrangements: Court Services – Borough of New Providence Sewer – New Providence Certified Public Works Manager – Union County Information Technology Services – Borough of Madison Health Services – Union County Police Dispatch/911 – Union County Vehicle Maintenance/Repair – Board of Education Police – Board of Education BH GLTV – Board of Education 8

COST REDUCTION EFFORTS – GRANTS: Municipal Alliance on Alcoholism and Drug Abuse Body Armor Grant Distracted Driving Crackdown Recycling Tonnage Grant Union County Infrastructure Grant CDBG Senior Citizen Center Program Union County Historic Preservation NJDOT: Safe Streets to Transit Program & Road Programs COPS Stop School Violence Clean Communities Grant Union County Kids Recreation Trust Fund 9

SERVICES PROVIDED TO OUR RESIDENTS: Police Protection and Community Outreach Public Library Court Services Recreation Programs & Activities Public Information Parks & Fields Building Inspections Code Enforcement Fire Protection Fire Inspections Rescue Squad Animal Control Storm Cleanup Street Lighting Snow Removal Yearly Bulk Pickup Bi-Weekly Bulk Recycling Road Repair Electronics Recycling Sanitary Sewer Collection Street Sweeping Storm Basin Repair/Replacement Sewer Infrastructure Maintenance Senior Citizen Bus Environmental Programs & More 10

ANALYSIS OF COSTS: Non-Discretionary Fixed Costs “Non-Discretionary Fixed Costs” represents those costs that are necessary to provide the required services to residents. 11

ANALYSIS OF COSTS: Non-Discretionary Costs (Cont’d) Non-Discretionary Operating costs are costs the Township is obligated to pay 12

ANALYSIS OF COSTS: - Cont’d 13

2021 SUMMARY OF REVENUES: Important Notes: The majority of this change is driven by a revenue of $10, 500, 000 under the “Other Special Items”, due to the sale of the Hamilton Avenue Property to Toll Brothers. “Other Special Items” includes: Reserve for debt service, liquor licenses, hotel tax, salt dome lease money, cable TV franchise, rents on Township properties, library health insurance reimbursement, etc. 14

2021 REVENUE DISTRIBUTION: 15

2021 SUMMARY OF APPROPRIATIONS: The increase in 2021 is primarily due to the payment of debt due to the $10, 500, 000 sale of Hamilton Avenue property 16

2021 EXPENSE DISTRIBUTION: Employee costs = salary, wages, pension, taxes, Social Security & health care 17

2021 BUDGET SUMMARY: 18

STATE OF NEW JERSEY BUDGET DISCLOSURE REQUIREMENTS: User-Friendly Budget Document Municipal Budget – State format Posting on Township Website (Berkeley. Heights. gov) of all Annual Budgets, Annual Audits, and Annual Debt Statements (three years required) 19

BERKELEY HEIGHTS BUDGET DISCLOSURES: Budget meetings / Workshop meetings: Held meetings public meetings on February 22 nd, and March 1 st, 2021, and encouraged public comment. Conference session on April 6, 2021 to walk the public through the 2021 proposed budget and encourage public comments. Budget Introduction via Council Meeting on April 6, 2021 Advertisement of Introduced Budget and posting on Township website on April 9, 2021 (Berkeley. Heights. gov) Public Hearing on Budget – May 4, 2021 Adoption of Budget – May 4, 2021 Post Adopted Budget on Website 20

Public Service Announcement: As of today, our tax collection rate is 98. 73%. THANK YOU, Berkeley Heights! QUESTIONS ? ? 21