West Cape May Introduces Budget with Penny Tax Increase

WEST CAPE MAY — Borough Commission introduced its 2010 budget featuring a proposed one-cent increase in the local purpose tax rate.
The budget totals $2 million, a decrease $149,000 from last year, with $1.4 million raised by the local tax levy. The budget uses $255,000 in surplus funds, $107,000 less than 2009. The remaining surplus: $118,000 is down from $200,000 last year.
The local purpose tax rate is proposed at 28.3 cents per $100 of assessed value. Salaries and wages are increasing from $334,000 to $367,00, an increase of 9.8 percent. Other expenses total $1.2 million showing an increase of under 1 percent or $11,740.
A public hearing for the budget will be held May 12 at 7 p.m. In the meantime, borough commission can reexamine and make changes to the budget if they wish.
Auditor Leon Costello said the penny increase in the tax rate represents a 3.9 percent increase in the budget. Under state law, the budget could be increased up 4 percent, he said.
West Cape May will see a decrease in state aid from energy receipts tax from $113,000 to $88,000, a total of $25,000. State Consolidated Municipal Property Tax Relief Assistance fell from $1,198 to $557, a loss of $600. Total state aid for 2010 is $89,960, a 22 percent reduction.
One penny in the proposed budget equals $51,560. Borough Commission would have to reduce the budget by that amount to produce a zero tax increase this year. Costello said the budget is $15,000 under the state cap.
An owner of a $400,000 home will see an increase in the local purpose tax rate of $40.
The assessed valuation of West Cape May is $515 million, down $156, 700 from last year.
Costello warned of a proposal for 2011 by Gov. Chris Christie to cap budgets to 2.5 percent increases in tax levy with no exceptions.
“That includes everything, so if your health insurance goes up 15 percent, you have to eat that with somebody else’s employment,” said Costello.
He said the borough was staffed mostly by part time employees.