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Friday, April 12, 2024

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Cape May Hears Financial Report

By Vince Conti

CAPE MAY – Chief Financial Officer Neil Young gave Cape May City Council a brief report on city finances at the close of the 2020 budget year.  

The basic message was that the city maintained its financial health during the year despite the pandemic’s impact on the local economy. 

Young showed that 2020’s revenues were generally below those of the previous year, but spending restrictions imposed by city management kept expenses from overshooting revenues across the board. 

Young walked the council through the current fund, the budget used for general operations of the city, and the three utilities that support water/sewer operations, supported by water rents, beach activities, heavily dependent on beach tag sales, and tourism programs, which draw support from Convention Hall fees. 

The bottom line was that all areas produced net revenues that will increase the city’s fund balance, although Young warned that the water/sewer utility can’t continue to operate comfortably with a fund balance that is only 12% of the annual budget. He said the city would need to consider an increase in water/sewer rates. 

Considering other factors that aided the city’s revenue, Young cited gains in late summer and fall tourism that helped offset some of the losses from the early months of the Covid lockdown.  

He also pointed to an over 99% tax collection rate, which netted $1.2 million over the budget’s anticipated level of municipal tax revenue. 

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