State of the Borough: Finance and Budget

Haddonfield Commissioner Jeff Kasko, director of finance, State of the Borough report. Delivered Saturday, January 21, 2012 at the 40th Annual Mayor's Breakfast at :

Mayor Colombi, Revered Getman, fellow Lions, fellow citizens:  Good morning.

I’ve been asked to keep my remarks to four or five minutes this morning, so instead of reviewing too many numbers with you, I’d like to give a brief overview of the borough’s financial situation and what we are facing now and in the future.

Two years ago, I reported that the fiscal state of the borough was sound—but not without its challenges.  I listed several revenue categories that were decreasing beyond our control and how we would need to aggressively seek out grant money, explore ways to share more services and expenses with others, and consider outsourcing certain local government functions.  I added that we would have to limit the role of municipal government to those functions and services that are mandated by law or expected by taxpayers.  These things are as true today as they were in the beginning of 2010.

Last year, I described the situation as very challenging for government at all levels and how we did not have the luxury of simply continuing to do things the same way they’ve been done before.  And guess what?  I can make these same comments this year.

Most of you probably realize that we have instituted cost sharing.  We have outsourced certain functions.  We have cut programs and services.  We now have a smaller, more limited municipal government.  We feel it and are affected by it throughout the year.

These challenges are not going away.  Our work is not over.  Certain costs continue to escalate.  State law now limits annual increases, with some exceptions, to two and a half percent for expenditures and two percent for property taxes.  Our tax collection rate has dropped, which means we must increase the reserve amount budgeted to cover uncollected taxes the following year.  And while this happens, we turn over 100 percent of the taxes expected by the county and the school district, leaving municipal government with the short end of the stick.

With a slow economic recovery, unemployment and falling property values continue to hurt all communities—including Haddonfield.  When revenue is going down and expenses are going up, there is no choice but to cut expenditures.

Another challenge that is not going away—and will probably escalate in the future—is increased pressure to regionalize and consolidate local government services in New Jersey.  While there are certain functions I believe are best suited to municipal control—particularly those involving public safety—it would be dishonest for me to stand here this morning and deny that this movement will not continue to gather steam.  I just hope that regionalization will not be forced in our state—and that we’ll have some flexibility and various options to consider when it occurs.

But it is not all gloom and doom.  Whatever fiscal challenges we face in the future, I am confident that residents in this town—particularly those of you in this room—will work together to face them with creative ideas, fair consideration, and the motivation to do what’s best for Haddonfield and its current and future residents.

We are blessed to live in this town.  And our town is blessed with many smart, ambitious, creative, thoughtful people.  If you have questions or ideas or comments about municipal government and finance, I hope you will bring them to me and the other commissioners.

Thank you for listening this morning.  Thank you, fellow Lions, for hosting us.  And thank you all for allowing me to serve as your Commissioner.