While a number of municipalities are still wrestling with a decline in revenue during the recession, township officials are hopeful that South Brunswick's budget for the upcoming year will reflect an improved business climate.
Mayor Frank Gambatese pointed to a surge in new construction fees that may signal the tides are turning towards a rosier financial picture for the township.
"I think we're in a good situation and we'll be okay with the municipal budget," Gambatese said. "We've had some really good construction fees come in that generated what we project at about $800,000. This tells me more corporations are interested in moving into town and that's good for us."
Over the last seven years, the township's ratable base decreased by over $180 million. However, Gambatese is encouraged by the recent addition of a number of new businesses to South Brunswick.
moved into the township, joining over 170 other new businesses that came to South Brunswick in 2012. Some of the new additions moved into pre-existing buildings throughout town, with five of the companies moving into space in excess of 30,000-square feet and whittled down the township's unoccupied warehouse space.
The township went from about 10 million square feet of unoccupied warehouse space down to less than 2 million square feet of unoccupied space. Gambatese noted that several other factor could also improve the township's bottom line.
"We expect a huge boost from a hotel tax and that's also a real plus," Gambatese said. "There's a lot of good things going on in the township."
The increased revenue will be needed to overcome the continued hurdle of residential and commercial tax appeals. Last year, 391 tax appeals were filed in the township, up from about 180 appeals in 2011, when approximately 100 companies successfully sued the township for a tax reduction. That reduction resulted in the loss of over $100 million in ratables, $98.5 million of which came from commercial and industrial tax appeals.
The Township Council has taken steps to try and reduce the impact by lowering the threshold for settlements on tax appeals. Previously, any settlement that was greater than $50,000 had to be brought by the South Brunswick Tax Assessor to the Township Council for approval. At a meeting last April, the council lowered the settlement limit from $50,000 to $25,000.
With extensive work to come over the coming months formulating the municipal budget for this year, Gambatese is hopeful the township will be able to avoid a tax increase.
"We may be looking at a couple cent increase, like two or three cents, but I know the council won't be satisfied with an increase and will work as hard as we can to get it to zero," he said. "We're still better off than most towns."
The Township Council approved a budget last year that held the tax rate at 72 cents per $100 of assessed valuation. The council was able to offset the drop in ratables mainly through the use of money from the Affordable Housing Trust Fund for prior work by township employees, and by getting money back from the state for the cleanup of a landfill on New Road.
South Brunswick's average total tax bill was $8,520.57 last year, which remained above the state average of $7,870.28, but fell in line with the statewide average increase of 1.7 percent, according to Star-Ledger analysis.
well below the state average of $2,324.66.
"Every town is faced with the same issues," Gambatese said. "But we believe we have tremendous potential for businesses coming in and helping to offset the loss of ratables. We had a great year last year, so we hope that continues. We have a lot of companies coming in and submitting applications to expand or relocate here, so hopefully that helps us out."