Toms River introduces CAP bank ordinance to fund anticipated labor contract increases without raising taxes

The Toms River Township Council on April 8 introduced an ordinance to establish a capital appropriation (CAP) bank, a budget mechanism that would let the municipality exceed the state’s 3.5% appropriation increase limit in order to absorb expected collective‑bargaining cost increases without redoing the budget or raising taxes.

The mayor and CFO explained the rationale: the township has reduced spending in recent years and accumulated surplus that can be used strategically. The CAP bank would permit the council to “bank” prior years’ unspent appropriations so they can be applied to upcoming negotiated raises for police and other bargaining units, while keeping the tax rate flat, they said. The CFO clarified that certain levy components (school and county) are not part of the municipal budget line items shown in the town’s budget documents.

Council members pressed for detail on ratables, capital balances and whether the CAP bank must be adopted now. Officials said the CAP bank ordinance must be introduced at this meeting in order to preserve timing for contract negotiations; the second reading would follow in a month, giving members time to review budgetary details with the CFO. The motion to introduce the ordinance was made and seconded and passed on first reading.