Vernon taxes creep up in 2017 budget

VERNON — The Vernon Township Council on Monday night approved the introduction of a 2017 budget that would see taxes creep up by nearly $50 for the average household.
According to a presentation given by Township CFO Elke Yetter, the proposed 2017 budget calls for $24.8 million in appropriations with just $8.3 million expected in revenue. That would leave $16.5 million to be raised through taxes.
The municipal tax rate under the new budget would increase slightly from $0.606 per $100 of assessed value to $0.632 per $100 of assessed value. That translates to an average tax increase of $48.75 per year, or $4.06 per month, for the average house assessed at $216,164. The budget introduced Monday does not include any potential increases in school taxes, which are decided on separately by the Township School Board in their own budget meetings.
Mayor Harry Shortway said the upward climb in municipal taxes comes courtesy of necessary spending increases in areas outside of the Township's control, including insurance and pension payments.
General municipal spending makes up nearly 69 percent of the proposed budget, while debt service makes up around 12 percent and the reserve for uncollected taxes makes up around 10 percent. Of the aforementioned general municipal spending, more than a quarter (27 percent) is dedicated to insurance costs while another 11 percent goes to pension and social security expenses. Another 27 percent of the municipal purposes spending is for public safety, 15 percent goes to public works and 14 percent is for general government.
In addition to increases in insurance and pension payments, Yetter and Shortway noted the tax hike is partially due to a decrease in money available from the fund balance. As the fund balance declines, Yetter explained, the amount of money that needs to be raised through taxes goes up. Shortway said the township has continually leeched money out of the fund balance without being able to regenerate it, leaving a sum that was one above $3 million now below $2 million.
“I cannot keep allowing dipping into this fund balance because if we get into an emergency, what do we do?” Shortway said. “We need to start building that fund balance up. I'd like to see it over $3 million but it's going to take time. We can't just keep diving into it.”
Shortway also railed against large entities in the Township that don't pay taxes — specifically pointing to Legends as an example — as another ill that negatively impacts the budget. As a general rule, the lower the tax collection rate is, the higher the reserve for uncollected taxes needs to be.
“We have a burden to pay (to the state and to the schools) whether people pay their taxes or not,” Shortway commented.
Shortway said the Township currently has 93 full-time employees and 25 part-time employees, though most of the latter are on an “as needed” basis.
The 2017 budget will be open to public comment at the Council's April 10 meeting.