Manchester residents will see a slight increase on their property tax bills because of a change in assessed valuations, even as the amount of tax revenue in the $16.1 million transition year 2012 budget remains flat.
Introduced by the Township Council on Sept. 24 and unanimously approved Monday evening, the transition year budget includes an annualized property tax increase of $7.50 for a home assessed at $125,000, according to township CFO Diane Lapp.
The property tax rate increased from .509 to .52 per $100 of assessed value because the valuation of properties in the township decreased from calendar years 2011 to 2012, Lapp said. The township's rateable base is $3.96 billion, down from $4.08 billion in the fiscal year 2012 budget, and a penny increase on the tax rate raises $396,428.
Fiscal to Calendar Year Accounting
The transition year budget is required for township operation between July and December as Manchester switches from a fiscal to calendar year operation, a change "highly recommended" by the state, Lapp said.
Because it covers half of a year, the budget was not subject to the 2 percent or other appropriations caps but had to come in between 95 and 105 percent of 50 percent of the 2012 fiscal year budget, which ended in June, Lapp said.
"Which we did. That was the only criteria from the state, besides submitting the application to them," she said.
The amount to be raised by taxation is $10,288,856.84, which is flat from the calendar year 2012 amount. That budget raised $20.5 million in property tax revenue.
"For the municipal part of it, it's remained stable," said Council President Craig Wallis. "So that's a good thing."
The budget includes $16,192,863 in total expenditures. Of that, 42 percent goes toward salaries and 58 percent is operating revenues, Lapp said, which includes the debt service, healthcare premiums and statutory expenditures.
The township will utilize $525,000 in surplus, leaving $900,000 in that account. State aid came in at $3.9 million and the receipt from deliquent taxes is $800,000, according to Lapp.
"We had an excellent collection rate late year, over 98 percent," Lapp said.
Over 2,000 property tax appeals were filed last year, Lapp said. Those appeals will be reflected in the upcoming tax bills.
"We're estimating that the credits for tax appeals will be $1.3 to $1.6 million, but we do see that it could go as high as $1.8 million," she said. "So we have set some money aside, almost $1 million for tax appeals, and we're also going to do some budget cuts so that we will be able to maintain the payments that we have to make up for our tax appeals and also so that it doesn't hit our surplus too badly."
'People are Hurting Financially'
Few residents in attendance at the meeting spoke during the public hearing on the budget. Leisure Village West resident Fred Lund questioned what the township is doing to alleviate financial burdens to homeowners during the current economic downturn.
"People are hurting financially, in particular seniors on fixed incomes," Lund said.
Lund suggested that employees contribute more toward their health insurance, work to find a way to stop payment for accumulated sick leave, and cut costs in the township's Department of Recreation, an area Lund said increased over the 50 percent allotment for this budget.
"The first two are state law and there's not much we can do to correct them," Wallis said. The Recreation Department fee appeared greater than half of a full year's budget because most programs are held in the summer, which is covered in this budget; fewer programs are held in the fall and winter, Wallis said.
Switching from a fiscal year to calendar year operation is expected to make things easier for residents.
"The theory for that is our residents will receive one tax bill per year," Lapp said. "I said theoretically because there are exceptions. If you receive a Homestead rebate, rebates are now credits on your tax bill which requires us to send you a revised bill."
A calendar year cycle also better aligns with municipal elections, which residents voted to move to November from May, Wallis has said. Terms will begin in January.
Half-year utility budgets were also approved:
- Eastern water: $1.5 million, eastern sewer: $2.26 million.
- Western water: $1.045 million and western sewer: $1.5 million.
"The rates for all utilities have been stable and the utilities have been self-liquidating," Lapp said.
The township has taken over operations from United Water in both of the service areas, which saved about $400,000, according to Wallis.
Work has begun on the 2013 budget, Lapp said, adding that department heads will soon meet with administrators to work on numbers.