Avalon Adopts Budget, Considers Flood Maps

AVALON – Following a public hearing at the March 22 Borough Council meeting, Avalon adopted its 2017 budget totaling $36 million comprised of its operating budget of $28 million, its Water and Sewer Utility at $6.7 million, and its Beach Utility at $1.5 million. 
The local purpose tax rate remains at $.226 cents per $100 of assessed value.
The budget presentation noted that ratables increased by $72 million over 2016 to a total for the borough of $7.5 billion.
Council member Charles Covington noted that the change in budget appropriation for the municipal budget amounted to an increase of $1,069,403.
He pointed out that this figure was, in part, an artifact of the accounting for Middle Township’s payment to the borough for participation in the recent dredging project.
When one accounts for that and the offsetting revenue and appropriations for grants, Covington said the “spending increase over 2016 amounts to only $45,004.”
Michael S. Garcia, of Ford-Scott & Associates, said that the borough’s credit rating made it the county’s highest-rated municipality, “higher than the county itself,” he added. The borough has an AAA bond rating from Standard and Poor’s.
The borough has a surplus totaling $7.7 million and elected to use $4.1 million in the 2017 budget, a use rate of 54 percent.
Garcia noted that having a strong, recurring surplus is important in maintaining a favorable bond rating.
The borough, which elected to leave the county library system to establish its own library, includes the library tax revenues and appropriations in its budget.
For 2017, the library tax revenue is budgeted to increase by $82,495.
Council President Dr. Nancy Hudanich praised the borough’s conservative approach to budgeting and fiscal management which “allows us to maintain the high quality of life Avalon residents enjoy while providing an even higher level of services.”
Hudanich paid special attention to a chart that showed 48 percent of the total $36 million in the budget goes to providing essential services. Those services include public safety, roads and infrastructure, trash removal, and beach maintenance.
She said that 20 percent goes to debt service and capital efforts. The budget numbers showed principal debt on outstanding bonds and loans at $14.2 million with an additional $2.4 million for the Water and Sewer Utility.
Only 9 percent of the total budget goes to general and administrative costs, a number Hudanich highlighted in her comments.
The remaining budget is divided with 8 percent for regulatory services like tax collection, assessment, and similar items along with 15 percent for what is termed “community services” including items such as recreation and library.
With regard to capital projects, the presentation of the budget noted that the borough uses a “pay as you go” approach to many capital efforts, making use of higher down payments and less overall debt.
Flood Maps
A decision needs to be made soon by county municipalities concerning adoption of the preliminary firm flood maps from the Federal Emergency Management Agency (FEMA). Current maps used in the flood insurance program were set in 1983, known as the effective firm maps.
Despite a great deal of effort creating the new FEMA maps, they remain preliminary as FEMA deals with an appeal from New York City. 
New Jersey is in the same FEMA region as New York.
Municipalities in South Jersey have been given the option of adopting the preliminary maps rather than waiting for several years for the results of the New York City appeal to be incorporated in a new round of mapping.
Every indication from FEMA is that early adoption of the preliminary maps would not later be upset if the appeal results in newer maps.
The preliminary maps were adopted by the borough for construction purposes and are used to regulate base flood evaluation levels. For insurance purposes the older 1983 maps still govern.
What council heard from borough Engineer Thomas Thornton is that FEMA numbers show that adoption of the new maps would move 261 properties out of the flood zone and 111 properties currently out of the flood zone into such a zone.
That means a number of property owners who are required to carry insurance due to their location in a flood zone, would be relieved of the requirement. 
However, a number of property owners currently believed to be outside the flood zone would be moved into such a zone in the new mapping and those with a mortgage would be required to add flood insurance.
In 1983 much of the mapping was done “by hand,” Thornton said.  “Now they have better technology and models that allow for more precise mapping,” he added.
FEMA is asking for a decision from municipalities by April 3.
The benefits of adopting the new maps are that the borough would then have a consistent set of maps governing both construction regulations and flood insurance.
Since FEMA believes that new maps would be a better depiction of real risk with respect to flooding, adoption would also make use of the best information to guide property owners in their decisions on insurance, even if they were not in a situation where the insurance would be required.
The difficulty with the adoption of the maps is that it moves 11 properties into flood zones and some of those property owners would be required by holders of their mortgages to purchase flood insurance representing a new expense for them.
Although it was not highlighted in the discussion, property owners have the advantage of the highest discount rate in the county if flood insurance is required or deemed prudent.
Four county municipalities have 25 percent discount rates including Avalon, which was the first to attain that rate through the borough efforts in the Community Rating System (CRS) program.
Although no formal vote was taken, Administrator Scott Wahl was instructed to notify FEMA that the borough would be taking the action necessary to adopt the preliminary maps.
To contact Vince Conti, email vconti@cmcherald.com.