The 2% cap is a good thing. It places real restrictions on municipal tax increases by capping additional tax levies year to year at 2%. But make no mistake, this law places the onus for tax relief on municipalities. The Governor's "tool chest" promises to make that job easier, but the job of cutting spending rests with the towns. The Governor and Assembly have sent a clear message that most of the hard work of saving tax dollars will take place at the local level. Given that reality, we need to prepare for the difficult work ahead.
To be clear, we operate under a 4% cap now, but there are numerous exceptions that make the existing cap toothless. The new law has just a few exceptions and will leave municipalities with little wiggle room. In any given year, if you have a category of spending (e.g. fuel costs) that increases by more than 2%, you will need need to cut spending elsewhere to offset that increase. Many municipalities, including Middletown, have not had the discipline to operate within a cap. Last year, against my vote, we applied for a waiver of the cap. We voted to defer our pension contributions (which will need to be repaid with interest over a term that starts in 2012), and by year's end, we needed to borrow $800,000 from 2010 to pay 2009 expenses. This type of reckless spending must end.
The time to start planning for this cap is now. One of the biggest problems with the budget process in Middletown has been our failure to start the process until well into the fiscal year. This year has been no different. It is July, and we have not held a single public meeting to discuss our budget or how we should cut spending. Clearly, at this point, any annual savings to be achieved from budget cutting measures will only be 50% effective, since half the funds have been spent by now. The perennial excuse is that we don't know exactly how much money we're getting until the State gives us our revenue numbers several months into the year. The problem with that line of thinking is that it assumes we cannot make cuts until we know how much money we have. Obviously, uncertainly over our final revenue numbers does not stop us from planning layoff, furloughs, reductions in service, etc. We have waited too long, and we cannot afford to make that mistake again.
We should start working on the 2011 budget now. We need to assume that Governor Christie's tool kit will pass. We should assess that tools that will be available to us, and we should start planning on how to use them. There will be difficult, contentious debates when it comes to jobs and benefits. We may need to reconsider our status as a civil service town. Our negotiating stance with Unions will toughen as the specter of mandatory arbitration is removed.
But even with these additional measures made available to us, a thorough, regular process for evaluating our services and the programs we deliver needs to be followed. Currently, we have no mechanisms or structure to ensure efficient execution of budget-cutting ideas and recommendations. No finance or budget committee. Without a more robust governance structure to engage in the work of following through on some of these budget-cutting ideas, we will never see their fruition. Some ideas that have been discussed but not yet implemented include: combining the maintenance functions in the Parks Department and Public Works Department, sharing maintenance functions with the Board of Education, outsourcing leaf and brush pickup, one day per week garbage pickup, and tougher enforcement of recycling laws. There are more suggestions, but no real process for implementing them. So, as we consider how we might use the Governor's tools, let's also put in place the committees and people to help us use the tools to their full measure.
Sunday, July 11, 2010
Televise Township Committee Meetings
On Tuesday night at our Workshop Committee Meeting here in Middletown, I asked the Township Administrator to provide the Committee with an assessment of the costs to televise Township Committee meetings. My preference would be televise them live, but even a taped, televised meeting is better than no televised meetings. I think televising our meetings is an important step toward engaging our citizens in their Government. If we can play tapes of concerts in the park, we surely can play tapes of our elected officials at work. If we are to put our financial house in order, we need a citizenry that pays attention, expresses opinions and has transparent access to all of our budget and spending records. Indeed, our system of government anticipates an informed electorate that cares about how its local government spends its precious tax dollars.
In recent years that type of involvement has been limited to a small segment of our residents. When good times prevailed, many members of our community lost interest in the activities of our elected officials. I do not exclude myself from that criticism. Escalating real estate values and a booming economy lessened the burden of real estate taxes on the average resident. As a result, the actions of our elected officials became less important.
But those times are gone for the foreseeable future, and we now must manage our public resources during a time of financial crisis. This means mobilizing our citizens to participate in the governing process and to volunteer to perform services that may have been previously paid for with tax dollars. As an example, we budget a significant amount of money every year toward the maintenance of parks and fields. We should explore organizing the local neighborhoods adjacent to our parks to participate in regular cleanups, grass-cutting and upkeep of these assets. I believe that Middletown residents would welcome the opportunity to come together as a community to take care of their "jointly-owned" assets and save tax dollars at the same time. To set ourselves on this path, we need to connect to our residents. Televising our meetings would allow citizens to observe their government at work and to weigh in on decisions that impact them or that involve matters where they may have expertise.
Corruption and mismanagement arise when Government is conducted in the shadows. Two years ago we took an important step toward opening up our government when Committeeman Short and I introduced a resolution to place all township meeting agendas, resolutions and ordinances on our website in advance of meetings. This resolution was passed unanimously by the Township Meeting. (It was also an excellent example of bipartisanship). This allowed residents to see what was being voted on at meetings. Prior to this, residents who attended meetings would frequently have little idea what was being discussed, because they had never seen, and had no meaningful access to, the documents being voted upon. Bringing our meetings to television would further open a door to local government that until recently remained shut to all but a chosen few.
In recent years that type of involvement has been limited to a small segment of our residents. When good times prevailed, many members of our community lost interest in the activities of our elected officials. I do not exclude myself from that criticism. Escalating real estate values and a booming economy lessened the burden of real estate taxes on the average resident. As a result, the actions of our elected officials became less important.
But those times are gone for the foreseeable future, and we now must manage our public resources during a time of financial crisis. This means mobilizing our citizens to participate in the governing process and to volunteer to perform services that may have been previously paid for with tax dollars. As an example, we budget a significant amount of money every year toward the maintenance of parks and fields. We should explore organizing the local neighborhoods adjacent to our parks to participate in regular cleanups, grass-cutting and upkeep of these assets. I believe that Middletown residents would welcome the opportunity to come together as a community to take care of their "jointly-owned" assets and save tax dollars at the same time. To set ourselves on this path, we need to connect to our residents. Televising our meetings would allow citizens to observe their government at work and to weigh in on decisions that impact them or that involve matters where they may have expertise.
Corruption and mismanagement arise when Government is conducted in the shadows. Two years ago we took an important step toward opening up our government when Committeeman Short and I introduced a resolution to place all township meeting agendas, resolutions and ordinances on our website in advance of meetings. This resolution was passed unanimously by the Township Meeting. (It was also an excellent example of bipartisanship). This allowed residents to see what was being voted on at meetings. Prior to this, residents who attended meetings would frequently have little idea what was being discussed, because they had never seen, and had no meaningful access to, the documents being voted upon. Bringing our meetings to television would further open a door to local government that until recently remained shut to all but a chosen few.
Saturday, July 10, 2010
Budget Irony in Middletown
The Middletown Township Committee recently voted to introduce a proposed budget for 2010 that raises the municipal portion of the tax levy by 13%. In other words, the operation of the Township requires the taxpayers to contribute 13% more than they did last year. During a period of belt-tightening and financial hardship for most taxpayers, an increase of this magnitude cannot be justified. You will hear excuses about loss of State funds, retirements and other factors that made this a difficult year -- and much of that is true -- but our Township Government has failed to take the decisive action demanded by these difficult times. We are in an economic downturn of historic magnitude, and we need to take action that meets the challenge of these times. Just take a look around at other municipal budgets and see if you can find a town increasing the municipal budget by 13%. These neighboring communities operate in the same budget environment we do, but have been far more proactive in preparing for and dealing with this financial crisis.
The irony in all this is that while the Mayor touts the Governor's actions to cut spending and serves on his transition team, he refuses to take comparable strong action here in Middletown. Instead, we vacillate and miss opportunities for savings. Rather than imposing layoffs and furloughs early in 2010 when we knew we were in financial difficulty, he waited until almost halfway through the year. When I recommended letting pre-qualified engineering firms bid for the road construction projects that we undertake each year, he voted no, choosing instead to award in January all of the Township's engineering work to one engineering firm, thereby removing any chance of securing savings through a competitive bid process. When I recommended negotiating a fixed monthly legal fee from our attorneys, he voted no, again missing an opportunity to negotiate savings. The Mayor refuses to consider merging the Sewerage Authority into the Township Government to eliminate hundreds of thousands of dollars in overhead. We need to immediately merge all property maintenance functions in the Township into one Department. We need to move swiftly to outsource a significant portion of the leaf and brush pickup. The salaries and benefits necessary to support this operation represent a significant portion of our municipal budget. Moreover, we pay heavy maintenance costs for the equipment used by these employees in the leaf and brush pickup. We should also consider moving to a one day per week garbage pickup. While this may be unpopular with some residents, with a renewed emphasis on recycling of all types of paper, the volume of waste can be cut in half, and the savings to taxpayers would be tremendous.
But change cannot begin until there is an acknowledgment that we must radically change the way services are delivered in Middletown. The Governor has boldly altered the debate, and we need to seize this rare opportunity to restructure how local government is run. We must first identify the core services that residents need and expect and ensure these services are delivered as efficiently as possible. Everything else that falls outside the category of core services should be evaluated for reduction or elimination. For core services, we must analyze, with the assistance of professionals, which services can be outsourced. In my brief tenure on the Township Committee, I have observed that the burden of salaries and benefits in support of the delivery of services is crushing. In our decision-making, we frequently fail to measure the lifetime costs of employees. In addition to a person's salary, we provide generous benefits that are unavailable to all but a small portion of private sector employees. After retirement, we continue to provide these benefits with little or no contribution from employees. As health care costs have escalated, taxpayers have picked up the tab. Until now, little has been done to contain these costs.
As elected officials, we need to be willing to make difficult, painful decisions to reduce spending. We will always provide police, fire and ambulance services. We will always maintain roads, respond to emergencies and pick up the garbage. But we need to examine parks and recreation programs, the swim club, the arts center, drug counseling, Middletown Day, and other non-essential services to determine whether we can provide those services through partnerships, outsourcing or other less-expensive means. We need to consolidate the sprawling, inefficient buildings that house are employees and programs. These decisions will not be popular, but the alternative is steady tax increases that make living here less attractive. We need to be prepared to lose elections in the interest of putting Middletown on a course that ensures its financial well-bring for the foreseeable future.
The irony in all this is that while the Mayor touts the Governor's actions to cut spending and serves on his transition team, he refuses to take comparable strong action here in Middletown. Instead, we vacillate and miss opportunities for savings. Rather than imposing layoffs and furloughs early in 2010 when we knew we were in financial difficulty, he waited until almost halfway through the year. When I recommended letting pre-qualified engineering firms bid for the road construction projects that we undertake each year, he voted no, choosing instead to award in January all of the Township's engineering work to one engineering firm, thereby removing any chance of securing savings through a competitive bid process. When I recommended negotiating a fixed monthly legal fee from our attorneys, he voted no, again missing an opportunity to negotiate savings. The Mayor refuses to consider merging the Sewerage Authority into the Township Government to eliminate hundreds of thousands of dollars in overhead. We need to immediately merge all property maintenance functions in the Township into one Department. We need to move swiftly to outsource a significant portion of the leaf and brush pickup. The salaries and benefits necessary to support this operation represent a significant portion of our municipal budget. Moreover, we pay heavy maintenance costs for the equipment used by these employees in the leaf and brush pickup. We should also consider moving to a one day per week garbage pickup. While this may be unpopular with some residents, with a renewed emphasis on recycling of all types of paper, the volume of waste can be cut in half, and the savings to taxpayers would be tremendous.
But change cannot begin until there is an acknowledgment that we must radically change the way services are delivered in Middletown. The Governor has boldly altered the debate, and we need to seize this rare opportunity to restructure how local government is run. We must first identify the core services that residents need and expect and ensure these services are delivered as efficiently as possible. Everything else that falls outside the category of core services should be evaluated for reduction or elimination. For core services, we must analyze, with the assistance of professionals, which services can be outsourced. In my brief tenure on the Township Committee, I have observed that the burden of salaries and benefits in support of the delivery of services is crushing. In our decision-making, we frequently fail to measure the lifetime costs of employees. In addition to a person's salary, we provide generous benefits that are unavailable to all but a small portion of private sector employees. After retirement, we continue to provide these benefits with little or no contribution from employees. As health care costs have escalated, taxpayers have picked up the tab. Until now, little has been done to contain these costs.
As elected officials, we need to be willing to make difficult, painful decisions to reduce spending. We will always provide police, fire and ambulance services. We will always maintain roads, respond to emergencies and pick up the garbage. But we need to examine parks and recreation programs, the swim club, the arts center, drug counseling, Middletown Day, and other non-essential services to determine whether we can provide those services through partnerships, outsourcing or other less-expensive means. We need to consolidate the sprawling, inefficient buildings that house are employees and programs. These decisions will not be popular, but the alternative is steady tax increases that make living here less attractive. We need to be prepared to lose elections in the interest of putting Middletown on a course that ensures its financial well-bring for the foreseeable future.
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