It doesn’t make sense to me that we could have only an $8M structural deficit. That would be around 4% of the total and percentage wise small. This doesn’t feel right given that our CPI is less than half the NJ average.

Of course we’re also not counting schools where are deficit is $125M given Missy Balimer’s assertion that the budget will be $290M, we’re paying only $20M and the NJ average is that towns pay half their school budget. We should be paying $145M but are only paying $20M.

A reasonable person might wonder whether a school + municipal budget of $500M ($212M + $290M) makes sense for a town of 80,000. That’s $6250 for every man, woman and child or roughly $15,000 per household.

The budget brigade’s crack analysis team is busy comparing this to other towns.

Your analysis is exactly what we need to as part of our effort to sort out the State’s PILOT money.

Cynthia is leading that but we all need to be clear about what’s what in the budget.

My suggestion is to leave out cost savings for the moment and just worry about the gap between proposed spending and state aid (not PILOT) + the tax increase (i.e. assume we’re still spending $50M / year).

Fair enough?

Perhaps its the $8M + $17M in state aid + $20M tax increase (the tax increase isn’t sustainable) = $45M. I leave out the police OT and put that in a bucket called potential savings along with all other wasted, unneeded programs etc.

I was looking at the Municipal Property Tax relief ($41M)+ $9M in increase in misc. aid + $20M tax increase = $70M.

If I’m wrong then that proves why we need to real thoughtful view.

Now here’s the fun part:

In 2009 we received about $14.8 million last year from a Municipal Revitalization and Economic Recovery Act. Most of the justified costs for this funding is project based, so I don’t believe that this effects our structural costs or is considered a structural revenue. As I understand it, this money isn’t used to pay police, fire dept, muni workers, fill potholes, etc.

Also last year we received $17.2 million in “Special Municipal Aid”. This is really part of the makeup between money we raise and what we spend.

In this years budget, both of the last two items are lumped together in one amount labeled “Capital Cities Aid”. The total amount actually went up about $2.85 million, but which part went up, its anybody’s guess. Why they do nonsense like this is beyond me.

In any case, the structural deficit is currently the $8 million this year minus the $3.5 million in police OT. In general we should consider that amount (~$7 million) plus the $17 million in the municipal aid as our overall structural deficit. True, the energy tax could end and the state could totally not pay us any relief for municipal services, but at that point I would bulldoze down the capitol and sell off the property.

I would add that our structural deficit could be lower as I am sure we could find some other fairly easy places to cut once the books and all of the budget maneuvering is laid out in full.

I took the total state aid number which is $87,000. Subtracted the Capital Cities Aid (I take this to be the PILOT money, but I maybe wrong). That’s about $50M. Added back the $20M increase in taxes over last year. Then I rounded.

That gets me to $70M.

We need the authoritative view of our state aid package + a realistic view of what our property taxes should be given our ratables, to figure out a better estimate of the gap.

The point is, what’s pie in the sky. I’d rather aim at 15K and work on taking down roadblocks for that kind of success than never try.

That said a realistic strategy needs to look at the capacity of a well functioning inspections department on the “build” capacity end. On the demand side we need to check that we’re wildly more attractive than other options.

Plan B is a slower pace, which we may get away with. Obviously, reinventing the government is a good first step and we don’t know what that will yield. However we can be pretty certain that we’ll continue to have a structural problem as long as we have such a large income gap. I’m hopeful all this will be illuminated with our research into the budget.

My main objective now is for the candidates to have their own thoughts on the size of the structural deficit and the remedy for it. So far, they are all just mentioning it rather than describing it.

Some of the candidates like the sitting council members and the Public Works director should, if we’re to believe the experience claim, have a very well formed thought on this topic.

Also, 15,000 new homes is a bit pie in the sky, no? Wouldn’t it be better to come up with a plan that addresses the possibility that such a plan is not 100% successful? Some people would think it unreasonable to expect more than 1K new homes over any 5 year period.