State 'forced' Brick to use most of surplus Only alternative was to raise taxes even more or cut services, mayor says BY PATRICIA A. MILLER Staff Writer The $26,543 left in the 2008 Brick Township municipal budget's surplus account is only on paper, Mayor Stephen C. Acropolis and Township Administrator Scott M. Pezarras said. "If you don't know anything about budgets, you'll look at the $26,000 figure and not look at anything else in the budget," Acropolis said" That figure is based on what was left in the surplus account as of Dec. 31, 2007, Pezarras said. "That's how the budget gets set up," he said. "Even though we are already into this year's operations, the budget is a snapshot in time. That snapshot is as of 12/31/07. Everything in the budget is dictated from 12/31/07." The township is basically "forced" to use most of the surplus because of the stateimposed 4 percent cap on the amount that can be raised by taxation, Pezarras said. "Would I like to have a million in surplus?" he said. "I'd like to have $5 million in surplus. But the alternative is to raise taxes more than they have already been raised. You can't do that anymore. We are being forced to use our surplus balance if we don't want to lay off people or cut services." The 2008 municipal budget calls for using $12.17 million of the available $12.2 million in surplus, leaving a cushion of $26,543. Both Pezarras and Acropolis expect to have roughly $9 million in the surplus account by the end of the year. "The alternative is to raise taxes more," Acropolis said. "You either use surplus or raise taxes or cut services. I don't even want to think about cutting services." The Township Council was set to adopt the budget at the July 22 council meeting, a day after the Bulletin went to press. The township already has a "game plan" to replenish the surplus account, including the sale of several liquor licenses, the sale of the Foodtown property on Route 70 and a land sale, Pezarras said. "We're hoping to realize all of this revenue before the end of the year," Pezarras said. "At the end of the year you will see the surplus replaced to like $9 million or $10 million." "We are now more than halfway to our goal of $9 million by the end of the year," Acropolis said. The $12.2 million in the surplus account includes $1.5 million in proceeds from Ocean County's contribution to the Traders Cove site and $5,827,116 in deferred school taxes. The township will also eventually receive an additional $1 million in revenue from the Municipal Utilities Authority for garbage pickup service since the MUA's inception. That revenue will be funneled into the surplus account once it is received, Pezarras said. The municipal tax rate will rise 9.6 cents, from 90.2 cents for each $100 of assessed valuation to 99.8 cents. That translates into a $132 yearly increase for an average home in the township. The proposed $78,042,704 budget is up $5,696,071, a 7.87 percent increase. The amount to be raised by taxation will rise to $46,902,935, up $4,651,607 since 2007. Pezarras and Acropolis broke down the budget increase into nondiscretionary and discretionary costs. The bulk of the budget increase - $5,205,523 - comes from nondiscretionary costs. Nondiscretionary costs include items like health benefits, pension costs and utilities, Pezarras and Acropolis said. Employee health benefits are up $1,342,200. Tipping fees at the Ocean County Landfill are up $180,000. Pension costs for township employees are up $439,371 from last year. Pension costs for police increased $770,679 from last year. Gasoline costs are up $275,000 from last year. While costs increased, Brick's state aid is expected to fall $656,230, to $6,915.588. Brick lost potential revenue sources when the negotiations for the Ocean Ice Palace property collapsed, Acropolis said. "We can't sell Civic Plaza," the mayor said. "We can no longer consolidate into one facility. That will cost the taxpayers more money over time." But he expects that Traders Cove will eventually be a revenue producer, once its redevelopment is complete, Acropolis said. "If you know you have revenue sources coming in, you are not worried about the surplus balance," Pezarras said. Pezarras and former Mayor Daniel J. Kelly said last year that the township had relied on "one-shot" revenues like liquor license sales, municipal asset sales and deferred school taxes to balance the budget for too long, which resulted in a structural imbalance. Acropolis echoed those comments in a budget presentation at the June 10 Township Council meeting. "The use of nonrecurring revenue sources, or one-shots, which are no longer readily available to balance the budget, are the reason for the structural imbalance," the mayor said then.