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Municipal Budget Up With Raised Health Insurance Costs

Budget process kicks off with discussion of appropriations.

With the beginning of a new year also comes the beginning of a new budget season.

Montville Township officials have already put hours of work into developing the 2013 municipal budget. Budget appropriation estimates were discussed at Tuesday's township committee meeting, with general appropriations anticipated to increase in 2013 by about $405,372 over last year's budget, representing a 1.42 percent increase.

Township Administrator Victor Canning said Thursday the figures presented to the township committee were preliminary and that there is still much work to be done in determining the municipal budget and how it will impact taxpayers.

"By state statute, we're supposed to, within the first week of January, convey a budget message, as admininstrators, to our elected officials that we've officially started the budget process," he said.

Included in the message, Canning was pleased to say that the township was able to decrease salaries and wages by $101,519 this year. He said this was done through attrition, including not hiring a new township engineer after Tony Barile retired, reducing a captain's position in the Montville Township Police Department as per a recommendation in the police study conducted this year and by privatizing services.

While the township was able to reduce costs in the area of salaries, Canning said costs beyond the township's control are the cause of the increase in general appropriations. This includes a 10 percent increase in health insurance premiums, terminal leave payouts owed to employees who retired in 2012 (a $269,495 increase this year) and the settlement of several tax appeals amounting to more than $800,000.

"Those three things alone are recipes for disaster," Canning said.

Canning said the township was able to save more money, however, by settling tax appeals than what could have been spent if the municipality entered into litigation.

"We probably would have risked way more than that," he said.

Canning said he is unsure at this time whether a change in technology at the Parsippany-Troy Hills Wastewater Treatment Plant that appears to have shifted the cost burden on Montville more than anticipated will have an impact on the 2013 budget and what the impact may be.

While the general appopriations shed light on some of the areas the township will spend money in the upcoming year, Canning cautioned that the figures offer only a glimpse of what's to come in the budget process.

The township is planning to introduce its municipal budget March 15, with plans to adopt a budget by April 26. However, Canning also said the budget adoption timeline is dependent on the state Library Board's returning of surplus money to the township.

Gary Lewis January 16, 2013 at 05:15 PM
The contribution is a percentage of the premium that goes up along salary scale, i.e. higher-paid workers pay a higher percentage of their premium, maxing out at I believe 35%, plus an additional 7 percent of their salary for pension costs. And please get up to speed....Governor Christie capped the practice of banking sick and vacation days 2 years ago.....that's old news. Also, I have not heard public sector professionals asking anyone to feel sorry for them......union leaders, perhaps, but not the average town worker. They pay property taxes as well. I agree with you the public sector had overly generous benefits throughout the 80's and 90's and, fortunately, an end has been put to it as fiscal realities kicked in. Kicking public sector employees, though, is crude and unwarranted. I watched these same folks firsthand leave their homes and families without power durting Sandy and work tirelessly to open roadways and clear hazards for the protection of Montville. We're all in this economic mess together. Gary Lewis
Dan Grant January 16, 2013 at 10:47 PM
Public Employee's make lifetime choices to put a cap on their income in exchange for public service. They leave any opportunity to make it into the top of the ecconomic food chain by virture of their choice of occupation and Thank God they do. Society needs the work they do. We need public works employees, we need Teachers, FireFighters, EMTs and Police and they are not in it to get rich but they do need a reasonable wage in exchange for the choice they make. You always hear about the excessive, usually top public management people with multiple pensions but the vast majority of public employees work hard and the loss of up to $6000 per year out of their checks under Christie hurt them and in fact hurt NJ's ecconomy. They spend their money and they usually spend it locally. Private sector workers have given up on their rights mostly out of a fear of being replaced. There was a time that paid health insurance was a standard benefit of private full time employment. They lost it. That doesn't mean that Public employees should be attacked and bullied because their employer happens to be the tax payer.
jf January 17, 2013 at 02:15 PM
Gary - I am up to speed thank you - I wasn't referring to the Christi era. I hear plenty of family and friends in the public sector complain and moan about what Christi has done and what other states are trying to do as well and a collective sigh of relief from taxpayers. I am not denying anyone a fair wage - it is easy enough to find public sector employees' salaries on the internet if people think I'm being unfair. But when the excesses begin to weigh on the people that shoulder them that's unfair too. Private sector employees have no choice but to give up - not out of fear of being replaced - but because they don't have unions to support them. I always said if anyone needs a union it's corporate employees. I know kids out of college that are making much less than some of the entry level public employees without education. Additionally these people get overtime and other perks the entry level positions don't offer in the private sector.
jf January 17, 2013 at 02:26 PM
GARY: Please feel free to get more specific as to what percentage MOST employees are paying versus this sliding scale. (The contribution is a percentage of the premium that goes up along salary scale, i.e. higher-paid workers pay a higher percentage of their premium, maxing out at I believe 35%, plus an additional 7 percent of their salary for pension costs.) Private sector employees have been doing this for years with no sliding scale and most without a pension, just 401k's. I worked for the biggest company in the world - and no it’s Walmart - and other Fortune 200 companies and all of them require employees to make a hefty contribution toward their premiums. All in all, I'm not looking to complain about problems - I'm looking for solutions - town - wide solutions not just salaries. I will reiterate my earlier remarks - we need a more fiscally responsible township with better budgeting skills so that everyone can benefit. This town is starting to feel like a carbon copy of our federal government. No cuts just taxes! And if that isn't going to work at the federal level it's certainly not going to work on the local level especially when you take into the account the cumulative effect of both an increase in federal taxes AND real estate taxes on spending and the ability of this economy to recover.
Gary Lewis January 17, 2013 at 03:52 PM
jf: Can't tell you with any certainty what the mean and median contributions are, only that the percentage of the premium goes from 6% for the lowest-salaried employees, up to 35% for the highest. The pension contributions are increasing incrementally annually to a max of 7.5% in a couple years, versus a much lower employer contribution. There are still many private-sector employers who offer health care at discounted cost-share rates....that is market driven. Public employees should pay their fair share and, fortunately, now do. A $6,500 annual employee contribution toward health care is pretty substantial - granted that's the high end of the spectrum. On the pension versus 401k point, I would generally agree, and in a good number of cases (not sure if it's a majority or not so I want to be careful), new public employees are in 401k defined contribution, not pension systems. Thanks again to Governor Christie...this guy deserves more credit than he gets sometimes. That being said, a $50,000-year public worker who was lucky enough to be enrolled in a defined benefit pension plan who works for the government for 25 years can expect a whopping $1,750/month in pension benefits; and in many cases, local employee retirees still have to pay their full health care costs in retirement, unlike police, fire and teachers. So it's really not as grand as it might seem on its face. P.S. Not looking to pick a fight with you or anyone, just to get some correct info out there! Regards, Gary

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