Finance officer outlines fund-balance outlook and options to close nearly $993,000 gap

Lorraine England, the township's new finance officer, told the committee at its March 6 budget work session that the municipality's fund-balance history and near-term projections will determine how much the town needs to draw from reserves to avoid swings in the municipal tax rate. "So, our fund balance in relation to our budget and what I feel we should have as a balance to me is a little scary," England said, reviewing audit numbers from recent years.

England said the township began 2021 with $636,000 in fund balance, used about $550,000 that year to offset taxes and finished that year with roughly $893,000 after revenue and canceled appropriations were returned. She said the auditor expects the closed 2024 balance to be about $1.0 million or higher. "I have, as an anticipated revenue in this budget draft, 500,000 that I was gonna use from that fund balance to offset taxes and bring in as a revenue in our budget," England said.

Committee members asked how that choice would affect rate calculations. England walked through the math for local taxation: based on the township net valuation of $931,000,000 and an average house value of about $383,057, she said one penny on the municipal tax rate is worth roughly $93,127. "So if you increase taxes 5¢, the average house would pay $192 more a year," she said, offering the committee a concrete sense of taxpayer impact.

England told the committee the current working draft assumes no municipal tax increase. She cautioned, however, that some prior-year overexpenditures and messy grant accounting require adjustments: "We started the week with, $993,000 gap. So we've improved dramatically," she said, noting savings from correcting duplicate salary budget lines and other reconciliations.

The draft also assumes revenue changes that remain subject to the auditor's final certification. England highlighted delinquent-tax collections and state certifications as variables: she said the auditors show roughly $350,000 in delinquencies that could be available for anticipated revenue and that a previously discussed municipal-relief item had not been certified and therefore was not included in the draft.

Next steps: England said she expects updated audit confirmation on the 2024 fund-balance figure next week, and that the committee will then consider whether to increase the planned draw from fund balance above the $500,000 shown in the draft or to use alternative revenue adjustments. The committee did not take a formal vote at the session.