S. Jersey towns look for answers as aid drops

Reduced support from the state means tax increases in some municipalities, but the situation looked worse in an earlier proposal.

Just like many residents, municipalities across New Jersey are struggling to pay their bills.

Fuel costs are up, as are state-mandated contributions to employee pensions and libraries, among other areas. The cost of health insurance continues to soar.

Local officials received one more piece of ugly news when they learned exactly how much - or, in their eyes, how little - aid they can expect from Trenton.

New Jersey towns will receive $1.8 billion this year, down about $162 million, or 8 percent, from last year. Many mayors say the hit inevitably will reach into residents' wallets, with falling state support translating into higher property taxes, service cuts, or both.

"We're at the bottom of the food chain," Gloucester Township Mayor Cindy Rau-Hatton said. "There's no one else to pass the costs on to."

Municipalities are among several groups feeling the impact after Gov. Corzine and the Legislature cut the state budget by $600 million, to $32.9 billion.

Only four towns can expect an increase in the primary form of state support. For the rest, cuts will range from hundredths of a percent to 35 percent.

"It's really a perfect storm this year," said Assemblyman Paul Moriarty (D., Gloucester), who, as both a legislator and the mayor of Washington Township, sees the issue from both perspectives.

He said Washington Township would trim its budget by $1.4 million this year, yet still need to raise taxes because revenue - including state aid - is down.

The town will lose $442,168 in the main category of municipal aid, or 10 percent.

Moriarty has introduced a township budget that would increase the municipal portion of the average property-tax bill by about $101. The average total tax bill is a little more than $6,000, he said.

"I understand the situation the state is in from being in the Legislature," Moriarty said. "I don't believe it's the wise thing to do to just turn around and put that tax burden on all the municipalities."

He said he had voted in favor of the state budget despite reservations about the aid cuts because it was a particularly difficult year, when many entities did not receive as much support as they wanted.

Cuts also hit hospitals, colleges and property-tax rebates, and co-pays were increased for a senior-citizen prescription program.

Corzine argues that New Jersey residents are clamoring for smaller government. As the state cuts back, he argues, mayors should do the same.

Municipal governments spent $11.2 billion in 2007, according to the state Department of Community affairs. The municipal-aid cuts amount to about 1.5 percent of that total.

"If they can't find that within their budget, they're not trying hard enough," Assembly Budget Chairman Louis Greenwald (D., Camden) said.

Corzine has noted that his spending plan also includes $540 million in additional money for public schools, which account for the largest piece of property-tax bills.

That should help the bottom line for taxpayers, he has said.

Like Moriarty, Assemblyman John Burzichelli (D., Gloucester) has a complex view of the issue. He sits on the Assembly Budget Committee and supported the idea that state government needed a diet.

But he is also mayor of Paulsboro, a borough of roughly 6,000, and voting for the budget meant supporting a plan that cost his community $222,516 in aid, a quarter of its state support.

After joining the many voices decrying Corzine's initial plan to target small towns, and seeing some aid restored, Burzichelli, too, supported the budget.

"I don't know that we have a catastrophe anywhere because of it. We have more pain, but getting the state's financial house in order is something that has to be done," he said.

Corzine pulled back from the more radical cuts he initially proposed so that no town would require more than a potential $100 average tax hike due to lost aid.

In Paulsboro, municipal taxes are expected to rise an average of about $80. That was due more to a massive tax appeal than aid cuts, Burzichelli said.

"When we finished with this budget, I was satisfied that, first of all, the budget was sending the right message and that the communities I represent could survive without upheaval," he said.

But he added that tax increases, even relatively small ones, weren't the only grind on residents. There are also gas prices, food costs, and a grim economy.

"You've got all these things contributing simultaneously to a mood out there that's at a very, very low ebb, in my opinion," Burzichelli said.

The cuts left some South Jersey towns scrambling for ways to pinch pennies.

Cherry Hill, which lost $779,073 in the main category of state aid, laid off five full-time employees in May, bringing staffing to a seven-year low, township spokesman Dan Keashen said. Under a new contract, employees will contribute toward their health insurance for the first time.

Cherry Hill also shares or will share services with the fire district, school district and neighboring municipalities and has signed up for a recycling program it estimates will save taxpayers $2 million over five years, Keashen said.

Rau-Hatton said a cut of $581,302, or 8 percent, in the main category of state support for Gloucester Township would be "devastating."

The township's budget last year was $43 million.

Township employees have shifted to a four-day workweek to save money, but Rau-Hatton said more cuts lay ahead.

"We're going to have to start looking at programs and deciding if they're essential," she said.

Smaller towns bristled at being singled out in Corzine's initial budget proposal, which he said had been meant to encourage service sharing and efficiency. Some mayors said their towns ran more economically than their larger peers.

Pemberton Borough Mayor F. Lyman Simpkins said his clerk "has eight jobs," including secretary and code enforcement officer.

The budget for his borough of about 1,500 is $1.3 million.

When steeper cuts were first proposed, Simpkins tapped the borough surplus, using $195,000 to keep taxes flat.

Now that the initial reductions were scaled back, Pemberton still faces a 31 percent loss of $57,852, but Simpkins said his residents could expect a municipal tax cut.

"We are one of those small towns that they cry cost the state money, but we know how to do things here," Simpkins said. "We could show them how to run the state."

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Contact staff writer Jonathan Tamari at 609-989-9016 or jtamari@phillynews.com.