It may be playoff season for some professional sports, but West Windsor Council had a grudge match of its own on Monday, April 16, as an amended version of the 2012 budget ultimately passed by a 3-2 vote, with party lines clearly drawn.
This year the municipal tax rate will increase by half a penny (.005) or 1.36 percent. The average home in West Windsor valued at $530,000 would pay an additional $26.20 in municipal taxes. The township’s total budget for 2012 will be $37.19 million — $163,000 less than last year’s budget.
The budget reflects two changes in the course of Council’s deliberations, slightly reducing the amount from the administration’s originally proposed budget of $37,340,000 (WW-P News, February 17). Five days ahead of the public hearing Mayor Shing-Fu Hsueh sent a memo to council members, reducing the operating budget by $150,000 by using $140,000 from the township’s $7 million fund balance, as well as reducing Planning Board Attorney Gerry Muller’s appropriation by $10,000.
The process of setting the budget was far from pretty as council members bickered and bantered, attempting to one-up one another, and even calling into question Robert’s Rules of Order. Councilman George Borek made the first motion for an amendment, and from there tension escalated as Council Vice President Linda Geevers felt Council had no time to deliberate on the budget.
Council finally arrived at two votes on amendments: one by Borek, identical to the mayor’s revision, and one suggested by Geevers and Councilman Bryan Maher. Since their non-binding resolution passed, 3-2, on March 26, Geevers and Maher had planned to introduce an amendment with the objective of a zero-cent increase in taxes this year. But on April 16 it became clear that the March 26 swing vote, Kristina Samonte, was looking at the issue differently, and Borek’s amendment was the likely choice of the majority, Maher then suggested reaching $450,000 by taking $150,000 from fund balance instead of $140,000, combined with $200,000 from the liquor license revenue and adding another $100,000 to projected uniform construction code (UCC) revenue. That amendment fell short with only Geevers and Maherr supporting it.
Borek explained his reasoning for the $150,000 as continuing with a strategic, prudent method of financial planning. “In 2007 and the start of 2008 we started seeing a lot of different things happening up in the financial world. People made bold moves. Bold moves got this country in trouble,” he said.
”One of the things I’ve always heard from speaking to people in town is that, when I ask them the question of why they came to live in West Windsor, the answer that keeps coming up is stability. Yes, we’ve had increases in the municipal tax levy and tax rate, but it’s because of prudent management and stability we keep it where it is,” Borek said.
Maher countered by saying he and Geevers went out of their way to not suggest a bold move.
“We took a little from here and there — that’s not making bold moves. Frankly, that trimming should have been done irrespectively,” he said. Nonetheless, in line with party affiliation from last year’s election, Borek, Council President Kamal Khanna, and Kristina Samonte voted for the $150,000 cut. Geevers’ motion for additional cuts was seconded by Maher, but that was all the support it got.
When additional cuts were voted down, several residents in attendance groaned, booed, and shook their heads. Many expected an even better outcome for taxpayers because of Council’s previous budget discussion. On March 26, Geevers, Maher, and Samonte all voted in favor of a non-binding resolution for the budget to achieve a zero cent tax increase. George Borek also expressed an interest in cutting the budget, although he did not vote in favor of the resolution saying he wanted to time to continue reviewing the budget. On April 16 he stuck to the mayor’s suggested $150,000 cut.
The revised budget memo from Mayor Hsueh included input from Phoenix Advisors LLC, the township’s financial advisory firm, which offered some clarity to Council on the use of one-shot revenue. In a follow-up interview on Tuesday, April 17, Samonte said that ultimately, using $200,000 out of a $2 million amount from the sale of two liquor licenses, originally proposed by Geevers to be a major chunk of at least a $450,000 budget cut, did not sit well with her. That factor influenced Samonte to change her mind.
Samonte reviewed documentation from Phoenix Advisors as well as the state Department of Community Affairs, and both suggest that utilizing even a portion of “one-shot” township revenue was not the best practice for municipal financial planning. In January, Samonte’s inaugural message as councilwoman regarding township finances was to follow best practices once such information becomes available. She held firm to that stance with the budget vote, and explained in detail a day later.
“Using one-time revenue such as money from the sale of the liquor licenses has been called into question. The Department of Community Affairs has a local finance service on that use of one-time revenue. Basically, they don’t want to see it used to reduce tax burden because it won’t be replicated the following year, and if you do that your budget would have to come under review by the state,” Samonte said.
At the final round of budget discussion, Maher did present her with another question. “Ms. Samonte, is it fair to take $2 million from the existing taxpayers and use it to upgrade this [municipal] building, which will be used for the next 30 years by all future residents at the full expense of residents today? Is that fundamentally fair as opposed to using the vast bulk of it ($1.8 million) for it, and bonding the remaining $200,000?” Maher asked.
It was then argued that bonding only increases debt service, but aside from that another factor Samonte weighed was West Windsor’s strong mayor-council form of government. Mayor Hsueh’s serious stance against using one-shot revenue from the liquor license sales for a temporary tax relief was one point; plans for green design and sustainability at the municipal complex was a corollary.
Another bone of contention with this year’s budget was the anticipated revenue from uniform construction code (UCC) fees, which, as Maher pointed out, appear underestimated at $775,000 for 2012. In the six years prior, 2006 through 2011, UCC fees generated the following revenues (in chronological order): $995,516; $1.07 million; $1.06 million; $1.28 million; $1.75 million, and $2.1 million.
Maher has said several times that such a decrease in expectations was unwarranted. At the April 16 council meeting Geevers said that the administration’s best expectation for 2012 was closer to a million, still $225,000 more than what is budgeted for.
But Mayor Hsueh also explained the formulation of that amount in an interview.
“In just the first two months of this year, we’ve already seen a reduction of $400,000 in UCC fees collected compared to 2011. Last year was totally unexpected (to gain $2.1 million). We never expected that with the economic downturn only a couple of year behind us. It was a record number of UCC fee revenues that we received, and the reason was that all of the projects going on now in West Windsor submitted their applications in the same year,” Hsueh says.
The mayor added that projects usually submit applications and pay the full UCC money up front through an escrow account. “They pay up front so we receive all the money from them at once. We are not going to receive more money from them this year. That revenue is unpredictable because it depends only on the developers and when they come in,” Hsueh says.
When time for public comments arrived, a handful of voices from both the Democratic side (for the budget) and the Republican side (against the adopted budget) were heard. Michael Donnelly, who was the campaign manager for Borek and Samonte’s slate in last November’s Council election, spoke in favor of the budget, as did Andy Bromberg of Princeton Junction, who contributed funds to the Democratic campaign.
Alvin and Janet Lerner of 67 Rainflower Lane, both spoke about using caution when financial planning is involved. Janet Lerner noted that government must operate differently from the private sector. Alvin Lerner spoke about observing the national outlook with a grain of salt. “Let’s not let the recent euphoria of the markets persuade us. The uncertainty is dreadful,” he said.
Those who spoke in opposition to the final budget — John Church of 11 Princeton Place, James Solloway of 5 Murano Drive, Gary Zohn of 42 Hawthorne Drive (one of Maher’s running mates for Council last year), and Marshall Lerner of 3 Sapphire Drive (a long-time leader among West Windsor Republicans) — all conveyed their disappointment at the approved budget reduction. Some people also questioned the factors that swayed the swing vote of Councilwoman Samonte.
Marshall Lerner cited the budget presentation delivered by Township CFO Joanne Louth earlier in the evening. Lerner said that the comparisons in Louth’s slides were budget to budget, not indicating the actual amounts spent. “The comparison that is more appropriate and generally accepted as reasonable practice requires that current year’s budgets are based upon current expectations of what will be spent — not what was appropriated to be spent last year,” he said.
“We have excessive reserves, and the reserves represent cushions. There are monies that are set aside and can be called upon if there are unexpected increases in costs. If in fact you take the conservative stance you still have a cushion of $7 million (from this year’s fund balance). That represents 20 percent of what’s currently proposed for spending,” Lerner said.
His finishing comments at the council meeting were directed at two council members, Khanna and Samonte. “When we the voters have a chance to express our opinions in the ballot box, we’ll know that Kamal Khanna is for higher taxes and he’s against economies in our government. We’ll know that Kristina Samonte is easily intimidated, understandably, because she’s new, but she changed her vote because I suspect some pressure,” Lerner said. Lerner also took a shot at Township Attorney Michael W. Herbert, calling him a novice despite the fact that he represents several townships and municipal governing bodies in the area.
Others were calmer in expressing their displeasure.
Sandra Donovan of 20 Sapphire Drive, a former executive with Standard Oil, spoke about her corporate experience and the differences in budget formulation she saw with the township. John Church said that the township revenue expectations were way too conservative. He added that it is ironic to use one-shot revenue for a project that could be fully bonded (referring to the municipal complex project).
James Solloway commented on the lack of budget cuts and lack of etiquette at the meeting. “This process and this meeting does not reflect well on town council. I was really rather shocked that the council — even those who supported the zero-cent increase — could only find $10,000 of operating budget to cut,” said Solloway. Solloway said that an unflattering phrase came to mind when he thought of West Windsor’s financial practices. “Eat like an elephant but poop like a bird. A $10,000 cut in the operating budget is really pooping like a bird,” he said.
Mayor Hsueh contends that what occurred at the budget hearing was contrived to be more of a fiscal, analytical approach than on March 26, when Council President Kamal Khanna was lambasted by Councilman Maher and members of the public.
At the Monday, April 16, Council meeting it was Maher who questioned whether Council was just playing games as Township Attorney Michael W. Herbert had to clarify procedures from Robert’s Rules once Borek made the initial amendment — and ultimately the definitive cut — to the 2012 budget. Maher says the mayor had only kept certain members of Council in the loop, but Hsueh denies that claim. He in fact met Maher ahead of the budget hearing.
“I tried to clarify some of the thing we did with this budget, and I gave him a hint then that I will never give way to using one-shot revenue for property tax relief. I made it very clear to him, so for him to say that I only consolidated with some select council members, that’s not true at all. I talked to every single one of them and let them know what I wanted to do,” Hsueh said.
But for one night, the night of the budget hearing and adoption, pure political drama prevailed. On Tuesday, April 17, the day after the hearing, Mayor Hsueh called out what he feels was a ploy that Republican Party members orchestrated. In a telephone interview Hsueh said that for weeks the Republican Club held meetings to discuss their opposition to the administration’s budget this year, based less on the dollar amount and tax increase involved, but more because their sights are set on the 2013 mayoral election in West Windsor.
Mayor Hsueh, who is approaching 11 full years in office, says the township’s Republicans saw an opportunity to attack his leadership in financial planning because a zero-cent increase was not formulated for this year’s budget.
“They tried to coordinate everything to the point that they thought they were going to be able to win this fight. The objective is to try to discredit me in preparation for the next mayoral election. They tried to set the stage for that,” Hsueh says.
