2016 Budget Approach Imperils Middle’s Recent Financial Success

To the Editor: 
I moved to Middle Township full-time after my home in Florence was sold in May of 2015. I retired from banking after a 45-year career as a construction loan officer, and a loan work-out officer. During that time I read and analyzed financial statements of borrowers to determine if they had the capacity to pay the bank back, and just as important, to determine whether their business statements were getting stronger or weaker. By doing this analysis, I would always try to access whether any problems were on the horizon.
Looking at the year-end balance sheets for Middle Township over the last four years, I believe this year’s budget is a lot different than the budgets of the prior four years when Tim Donohue and Dan Lockwood were in control of the budget making process, and I see problems on the horizon.
I don’t want you to take what I have just stated as just partisan politics. One of the best ways to compare the various budgets is to look at the year- end balance sheets as I mentioned earlier. The balance sheet is a snapshot picture of the township’s funds on just that one day. Comparing them, however, is a way to determine the direction of the township’s finances.
Let’s take a look at the budgets.
The surplus is slated to be reduced from $2,062,200 on Dec. 31, 2015 to $1,641,000 on Dec. 31, 2016. That represents a whopping decrease of $421,200 (a 20 percent reduction). These funds were taken from the surplus to offset this year’s spending increases in order for the township to maintain a zero tax increase. As of Dec. 31, 2015, the surplus amounted to an all-time high of 18.2 percent of all assets. This is a good barometer as to the financial strength of the township to be able to sustain a disaster if one occurs. In addition, the cash and investments at year-end 2015 were $7,370,800 or 65.5 percent of all assets (an all-time high) which is also a good barometer of the township’s financial strength. The cash liabilities as of Dec. 31, 2015, were reduced to $5,345,500 much less than prior years. The significance of these two numbers is that the township, in theory, would have had the ability to pay all of its cash liabilities, and still have over $2 million left over with no cash liabilities. This is one of the main reasons Middle’s bond rating improved in 2014 from a negative to a positive outlook.
These Dec. 31, 2015 budget numbers came about from the hard work that the Donohue-Lockwood team accomplished over the last four years by implementing prudent spending policies thus allowing for no tax increases which had the residents of the township foremost in mind. It should be noted that the budget in 2015 was 27.4 percent lower than the budget in 2010, and the township was fiscally in its best financial shape. Due to the vast spending increases in this year’s budget, the township committee will be hard-pressed not to raise taxes in the year 2017.
All said, I believe that we need to elect Dan Lockwood to continue the hard work he did before to implement the technical knowledge and attention to detail required of a township committeeman, to put the township’s future budgets back on the well-run path to greater financial strength and stability.
I hope for the sake of Middle Township that you will join me in supporting Dan Lockwood for re-election to the township committee.