Get our newsletters

Shrinking surplus concerns Newtown supervisor

Posted

With just a few minutes of debate but little fanfare, Newtown Township unanimously approved its 2019 budget plans.

After an additional $86,000 saved in health insurance premiums were added back into the plan, the projected 2019 year-end fund balance looks to be somewhere in the neighborhood of $1,326,000.

No tax increase is part of the 2019 plan. While Republican Kyle Davis was thankful for that, he expressed his displeasure with the fact that the expected year end fund balance was down from the $1.9 million the previous board projected when he sat in the majority along with fellow party members Mike and Ryan Gallagher.

“This budget is good in that we are not raising taxes,” said Davis. “I do have a concern that we are going deeper into the net fund balance.”

The township ended fiscal year 2017 with a $3.14 million net fund balance. Newtown will end 2018 with an estimated budget surplus of $2,538,000.

“Last year, when I sat in the majority, there were complaints about the net fund balance going down and we don’t seem to be having that conversation this year.”

In addition to plans to hire a police officer, the township has its eyes set on the purchase of three new patrol cars, two new police motorcycles and a new truck enforcement vehicle. Public works would get a new backhoe, two new dump trucks and two large mowers for the township parks.

Davis suggested that the board look into making some cuts.

“I don’t know if we want to consider any cuts, specifically a police car and a dump truck,” he said. “But that’s still not going to bring the numbers up really high.”

Chairman Phil Calabro objected to the suggestion.

“I hate to think of a police car that’s been beat up for a number of years and is going to an emergency,” said Calabro. “Then, all of a sudden, it breaks down. That doesn’t look good for the township.”

Davis responded with his displeasure with last year’s installment of new tax that funds fire and emergency services, implemented by the current Board controlled by Democrats.

There was good reason for the new tax, said Calabro.

“We were taking the money out of the general fund, which was depleting it. Now we’re not depleting the general fund.”

Newtown relies mostly on earned income taxes (EITs) for revenue as opposed to property taxes. The township is expected to collect $6,938,000 in EIT revenues this year and that’s down only slightly from $7,051,000 collected in 2017.

The township lost about $400,000 in earned income taxes it used to collect when Middletown and Bensalem townships decided to implement an earned income tax. In that case, the municipalities split the tax revenue. More than $320,000 is owed the township in delinquent EIT.

“We are being depleted in our revenue by other townships, which also may be instituting (an earned income tax) in the future and we have to be prepared for that,” said Calabro.

“We can’t keep bleeding like this; we have to find ways of generating revenue and EIT may not be the answer anymore.”

Davis retorted.

“That’s where we disagree. I don’t think we need to find ways to raise revenue. I think we have to make sure we control our costs.”

Calabro crunched the numbers.

“When you add the $400,000 (in lost EIT revenues) to $1.3 million, we’re at $1.7 million,” said Calabro. “Then, we’re only $200,000 off last year’s ending balance.

Calabro says he endorses the 2019 budget as, during darker days, the township has sold assets and has had to borrow money to make payroll.

“I see this as a functional budget, giving these departments what they need and also without raising any taxes,” said Calabro.

But Secretary-Treasurer John Mack is also concerned about depleting the township’s year-end balance.

“The Finance Committee suggests what we really have is a revenue problem,” said Mack. “Does that really impact, for example, our ability to borrow? We may be getting into a gray area unless we do something to increase revenue.”

***

In a different matter, Mack walked back his comments made at the Nov. 28 bi-monthly meeting about a policing arrangement with Wrightstown.

Mack had this to say at the beginning of the next session Dec. 12.

“I regret some of the things that I said about the Wrightstown-Newtown policing arrangement without being aware of the contract – a longstanding contract – that we’ve had with them.

“I hope that we continue to have that relationship because it seems to be a benefit to both townships and has worked out for many years and I hope that it will continue to work for many years, hereafter.”

In other news, the supervisors voted 4-1 to authorize a pair of law firms to file a civil lawsuit against the manufacturers, promotors and distributors of prescription opioid medications.

Mack, Calabro, Dennis Fisher and Vice Chair Linda Bobrin voted affirmatively for the measure with Davis casting the lone vote against the decree. Mark J. Bern Partners LLP and Cordisco & Saile LLC will file the motion in Bucks County Common Pleas Court.

stevesherman222@gmail.com


Join our readers whose generous donations are making it possible for you to read our news coverage. Help keep local journalism alive and our community strong. Donate today.


X