Price Hike In Healthcare Costs Impacting Chester Budget Discussions

CHESTER, NJ — Michael Inganamort, mayor of Chester Township, spoke out at a recent council meeting to address the ways in which residents will be impacted by upcoming increases in health insurance premiums.

The state surprised all New Jersey municipalities, including Chester Township with a 20 percent increase in healthcare insurance rates earlier this fall, prompting local governments to pass resolutions opposing the increase in an effort to fight back.

Hundreds of thousands of New Jersey public employees, early retirees, and school employees could face rate increases of up to 20 percent for health benefits under the new healthcare proposals.

"As most people know, Chester Township faces a state-mandated 22 percent increase in healthcare premium costs and a state-mandated 19 percent increase in pension costs. In real dollars these are approximately $276,000 plus another $120,000," Inganamort said.

Combined the two increases represent a four percent tax increase for the township.

"This puts us well outside the two percent property tax cap, which is the state law that prevents municipalities from raising taxes by more than two percent, except for specific emergency circumstances," Inganamort said.

According to the mayor, Chester has been aware of the premium and pension increases since last year, however, Inganamort claims that the Murphy administration knew about the increases long before.

State Senator Anthony M. Bucco stated last fall that the mayors of Morris County were correct to be concerned about the impending impact of massive health insurance premium increases.

"It’s clear, however, that Governor Murphy knew this was coming as early as February, months before the increases were announced. Had the governor shared that knowledge with the rest of us this spring, we could have worked on a solution with mayors, local governments, and the administration as part of the State Budget adopted in June," Bucco said. "Unfortunately, that never happened because the administration wasn’t transparent about what it knew."

Locally, Chester Township residents may experience budget constraints and higher property taxes in this year's budget as a result of the significant increases in health insurance premiums.

"We are working to find other savings in the budget to accommodate the 22 percent and 19 percent increases. We haven't gotten all the way yet, but we know approximately $200,000 needs to be cut from other services in town," Inganamort said.

Among the budget changes, is a future shift in how garbage collection fees are paid within the township.

According to the township, a new agreement for continued garbage collection with Blue Diamond Disposal, Inc. will be paid for by Chester Township, which will establish a municipal utility as the payment method.

"The council explored and ultimately decided to create a municipal utility for the purpose of directly billing residents for garbage collection. Doing so takes the cost of garbage collection out of the municipal budget and puts us back in the range of getting under the two percent property tax cap," Inganamort said.

As part of the new utility, all residents will be billed approximately $400 per year for garbage collection. A $25 discount will also be available for certain senior residents and for veteran residents, the council said.

Following discussion from the council, the ordinance was later amended to instead call for semi-annual payments with the first being due on April 1 and the second being due on Oct. 1.