Good morning everyone. Uh welcome to a nice Saturday morning here at town hall. Uh this is a special meeting for the 2026 budget workshop. Please take notice that action will be taken on the following items at the special council budget meeting on Saturday, March 7th,
2026 in council chambers, Sparta Township Municipal Building, 25 sorry 65 Main Street, Sparta, New Jersey. Uh the time is 9:14 a.m. and the budget meeting is opened. Adequate notice of this meeting was provided to the public and the press on
March 3rd, 2026 by delivering to the press and posting on the township website a copy of the notice of the meeting. All council meetings are now livereamed and can be viewed at the following link youtube.comspartatwpstreams.
At this time, uh, Madame Clerk, would you please do a roll call? >> Councilman Scott >> here. >> Councilman Murphy >> here. >> Councilman Clark >> here. >> Deputy Mayor Sylvester here. >> Mayor Blumetti >> here. >> Okay. Will you all please join me in a
salute to our flag? >> I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. >> Okay. So, uh a couple opening comments.
Uh first of all, this meeting is uh start it's it runs till noon. Um and we're going to I'm going to plan on one recess about halfway through so we can just have a little break for a few minutes. Uh just a reminder, this is a a workshop. So this is a working meeting. This is not a presentation. This is not
the final budget. It's an iterative process. Uh we will have a public comment period at the end to share questions or comments that we can take forward with us as we continue to work through this budget process.
Okay. And I think we'll start. Uh Mr. Zep, would you first uh maybe you're playing this, would you just introduce um the employees who are here probably thinking this already just so everyone knows who's Okay. Thank you so much. And I didn't think you have a statement to start with, too. Thank you. >> Thank you, mayor. Uh we're on the same
page on that. Um good morning, mayor, deputy mayor, council members. Before we get started, I'd like to just introduce uh some of the folks that are in the room. Um there's some staff members here who uh helped make Sparta run and I just wanted to acknowledge their presence uh for those uh who are watching from home.
Um Lieutenant Antello, Captain Snyder, Chief McCarrick, Administrative Assistant Maria Morrow, Gene Montrono of the parks and recreation department. Um Don Crumpford and Mike Corino, my finance team. Um thank you. So good
morning. Um I you you had mentioned that the session is scheduled from 9 to 12. Um there's a possibility it may end up not taking all that time. So we'll we'll see how it goes. Um
I'd like to start off by reading a statement I prepared regarding this year's budget. Over the past several weeks, my finance team and I have been closely reviewing the township's fiscal position for 2026. During this past Monday's work session, it became clear that we are facing a
critical budget situation. The projected increase over last year's budget is approximately 9 to 10% representing roughly a $3 million increase. The primary driver of this increase is a substantial multi-year rise in health care costs for the township's 190
employees and retirees. This increase alone represents almost 70% of the total cost. Additional significant cost pressures include the required repayment of the 2025 emergency appropriation totaling $250,000.
the veteran tax lookback benefit that totals $275,000 and it also reduces the surplus available for 2026. Um Mr. Gino will will expand on on what what I mean by that on its uh effects on
the surplus continued subsidation subsidizing of the sewer utility by the general taxpayer in the amount of 191,000. These costs represent about 15% of the total. The remainder are O and E which includes staff salaries and the
operating expense budgets. As council is aware, the township must adopt a fully balanced budget that remains compliant with both the tax levy and the appropriation cap tax levy cap and the appropriation cap. Given the magnitude of the increases and
a limited availability of surplus, expenditure reductions are necessary to meet those statutory obligations. After evaluating several options, the finance team and I are considering the following cor corrective actions. Reducing the 2026 capital improvement
plan to zero. This represents a $ 1.8 million reduction and is essential to bring the township within an acceptable levy under the tax levy cap. Restrict overtime to only the most essential needs, requiring approval from the manager's office. This measure would
operate in conjunction with the existing hiring freeze and careful evaluation of any replacement positions through at least the remainder of the year. Overtime for celebration events this year must also be considered. Ongoing reductions to the operating
expense budget, also considering the master plan work for 2026 be reduced or suspended. We are anticipating the 2025 financial statement from the auditors. This will give us a more accurate assessment of financial standing for better or for
worse. Meanwhile, the draft budget can start to be constructed. That's what we're doing today. These actions taken together should allow us to produce a balanced 2026 budget. Though, it's important to note that doing so will still require a 9 to
10% municipal tax increase yet to be calculated. With a combination of unanticipated expenditures, limited fund balance, four consecutive years of essentially flat ratable growth, the township now finds itself in a difficult, unsustainable
position. The steps outlined above represent the most responsible path forward to meet our statutory obligations while minimizing further long-term structural impact and compromise services for the Sparta residents. We're targeting to introduce the 2026
budget at the March 24th council meeting pending uh the reception of the uh annual financial statement. Um that must happen first before we can introduce. Um again, normally at this juncture uh of the year, I would be presenting to all
of you a proposed balance budget. Uh there would already be handouts ready for the public. Uh it would be uh posted on the website. um because of the situation we're in um we still have to find a way to balance the budget and my
finance team is working diligently at doing that. Um it is my duty to report to all of you uh the situation we're in and make you aware of what's happening. Um these measures are going to affect service to the town in some ways. We're
trying to make it the least uh uh uh effective um measures to get us to the end of year with a balanced budget. Um personally, I am optimistic that uh the future coming coming down that we'll be in a better situation. Um and we have
done a lot of work in the past two years that I've been here. We have uh passed tax measures. We've done the tax measures. We've increased uh the rut to try and keep our surplus uh um in check. Um, check the other municipal neighbors
around us. They're all in the same situation. They're all in in in in very uh difficult uh of having to balance their budgets. Some towns are weathering it better than others. Uh, some towns are using their surplus uh to get them
through. Uh, that's what the the fund balance is for. That's exactly what it's for is to get you through a rough a rough stretch of something like this. Um, but with that being said, what what I'm going to do is I'm going to turn it over to my finance team. Um, and they're
going to discuss uh really why we're in this position. And it's really because of the the tax cap, the tax levy cap and the uh spending cap. And I I'm going to just turn it over to finance and they're explain that first and then explain what we're doing to address that.
>> Thank you. And if I could, sorry to interrupt, but I think it might be helpful to just for everyone he on the dis and then participate at home is maybe just explain how a budget gets put together. Um, you know, I think the the public and others don't quite understand
all the work that goes into determining what each department needs, how it determines its own budget, how it prioritizes, you know, expenditures that it needs. I think that might be helpful as people start asking questions. Why do you need to spend X for Y? I think it might be
helpful just, you know, one minute to explain how you actually put the budget together. >> We take longer than one minute, but I I appreciate the question there. Uh, Councilman, >> um, >> do you want to run through that or I
>> just wanted to also thank Don and Mike for all your work thus far and continuing on this. I know it's a lot of time and effort and focus and it's critical work and we appreciate it. All right. The first thing I think is let's let you explain the difference between the inside the caps and outside the caps for the council.
>> Okay. >> There's two caps. One was put in place uh before I started in the industry. It's a uh appropriation cap of 2%. Some of you I heard rumblings had asked
a question. What is the COLA ordinance you had previously passed which is 3 and a.5%. That allows you to take the appropriation i.e. the spending side of the budget up to 3 and a.5%.
Now there are several items that the state has given us more expand has expanded that for us because of their own inability to remain within their own uh legislation
cap. So there are certain things that help us and hinder us from expanding the expenditure side spending side of that budget. So we're don't just can't say okay we're going to just tax it. We're
good. All right. So they hold us our feet to the fire and hold us accountable within that cap. So that that has is a one side the spending side. The other side which was put in place in 2010 and I was working then and I thought it
would be oh that's easy. We already have the one cap on the spending side that we don't have to worry about. Well, lo and behold, the uh the levy cap, i.e. the revenue where we can tax has limited us.
So, and again the state has made several caveats i.e. this year the health care uh health insurance that has increased so much there is where we can expand
over that. So that's one thing that's I don't want to say helping us this year, but it's not really hindering us. So we can go past that. But we're we have to work within the two sides of the budget. Both the spending and the revenue side.
>> What's the revenue cap? The percentage. >> It's 2% plus all the items that the state deems expandable. I.e. The uh one of them is the uh as I said the healthcare. Ready
for this one? The other one is the um pensions and they actually bill us for the pensions to make their budget hole so they can pay the retirees. So they give us where
we can expand on that too. So they give us the bill on that, but they also said, "Okay, you can now charge your taxes more so because we need your money." So that's what's in there. Okay. And
there's uh several other items, i.e. the um the ratable increases. We are allowed to go above add that on as well because it's new revenue. So, we can add that to the levy cap because if you take the
levy cap, I'm sorry, the uh new ratables and put it in your your budget, everybody has a flat tax if that was the only thing going in. So, all the new ratables coming in, you keep on raising that that levy to to pay for this.
It that additionable ratable if increased every year will be everybody's a flat tax. But there's other items that go into that obviously. So, okay. Um, >> two sides can't be interchangeable once you're in the in the >> D, if you wouldn't mind, I just ask you
to use the microphone. >> Yeah, >> that's suspended. >> Just people who are watching streaming. Thank you. >> No, what what was your point, Don? Please. >> Yeah. Got it. >> No, I was just making the point that, you know, they're not to a point interchangeable. Once you're outside the cap, you're outside the cap. Once you're inside, you're inside. You can't move
them back and forth. >> Uh Jim brought up a point. He wanted to me to explain how uh some of the surplus this year wasn't rein um wasn't bolstered because of the vet give back
tax. Okay. The what had happened there it actually reduced the amount of revenues we received last year because we paid them back out of the taxes that were collected. So that item is reduced. And then this year we also to show that
and prepare for it, we put it in this year's budget. So that's why that's there. It's basically what you have. And the other thing that most people don't realize, yes, we are the collection agency for the town.
uh whether it be your uh utility bills or what we have to pay out. Okay, the county we collect at 16.9%. The schools 64.4%.
Municipal open space 0 Well, what is it? Uh it's negligible. 3.03%. Uh the library 1.4%. And us in the room 16.8%.
So just so you know that the uh Yes, we >> What's that percentage based on? Where are you pulling that against what number? >> Last year's assessed taxes to to each >> everyone. But just to be clear for everyone, everything we're talking about today is with respect to that 16.8 8.
That's 17. >> Correct. That's that's the only thing you have control of. You don't even have a control over the library. The state gives us that figure as well. >> Okay. >> Okay. >> Do you want to talk about the construction of the budget that council
member uh Clark was asking? >> Sure. Okay. >> Why don't you do that? >> Oh, yeah. Thanks. All right. So, sorry, I'm starting to lose my voice. So every year what we do is we sit down with the department heads starting around September and we have printouts of a
budget worksheet which I think you may have seen. So we sit down with each department and we go line by line. We show them what they have used this year shows from 22 up till present. So it's
going to show them everything they were budgeted for. And what we do is we look at what they were given last year and what they actually spent. I ask that every department even if they lose money in that line that they still
charge it and let it go into the negative if you see some negatives because that's the only way we will get a feel as to how much money you actually need in that line item number. What you see I think there on the sheet we gave you where it just says operating
expenses. That's the main control line of every in every department and there's sub accounts that equal that. So the sub accounts are what we go through with all the departments to see what do they need, what can they what can they do away with, what can they shave and
that's what we do. We sit down and this year we tried to keep it within the 2%. All right. So we we we have shaved off as much as we could for the operating expense to try to keep us at a lower
rate. But and that's what we do every year. So we meet with them, we see what they want and now that we compile that into this spreadsheet, we drop some numbers in and that's where we bring us to today. Along with that, you are you should
already know that you have uh bargaining units that have contracts and we utilize those to give us those department and what each individual earns within that department and charging it appropriately
based upon the bargaining unit andor just there's a regular rank and file that uh is not a bargaining unit and we have their uh numbers within the salary lines. So that's where those come from. >> I think on your handouts you'll see anything that I highlighted in red.
That's because those are figures that are contractual and we have no control over. Okay. That was to point that out so you knew those lines can't be touched. And as a percentage of you know I guess we would have like 190 employees of those you know ballpark how many of
those employees are under a contract meaning they their salaries are negotiated visav you know >> let's go the easier way and I'll tell you that probably the non-unions probably about 35 40 employees everybody else is contractual
>> so we're looking at like 70% of our contracts and and salaries are visav Vot you're looking at uh S SOA FOP for police. You're looking at dispatch. Look at your parks workers, DPW, water. All
under contract. >> Okay. Thank you. >> I mean, if I may, mayor, managers app, what's the format here? Are we just speaking as we go or are we going to hold all our comments? And because I have questions just looking at
the the reference sheet right now, should we hold them? Yeah, my preference is to let let us do the overall overarching information first, right? Set the stage, do the foundational stuff and then perhaps walk through these handouts or at least walk
through the big items that are changing just so we're we can if we have questions we can address them at that point >> as we go down as we go down. Okay, that's good. Just so it's a little helpful. >> Yeah. >> All right. I think we're basically done how we construct things and how much
information comes into uh the finance office. Um Dawn has uh worked hard on figuring out where and what the major drivers are in each department. I wouldn't recommend
going line by line item but uh just asking the overall why certain departments have gone up or down may be the uh best thing to do. Okay. >> If if you don't I'm going to stay with the overall look on this. So I had
commented that we had a a difference of close to a $3 million increase from last year, right? And I said about 70% of that is health insurance. All right. And then about another close to 15 18% was
uh emergency appropriation, vet tax, uh um and we had some other uh supplementing that the sewer utility. Uh that was the other quarter of the pie that I'm visualizing. The other quarter that we actually have control over is the OE budget and that's what we're talking about. All right. And with that
budget, we still have to maintain being within the caps that Mike had discussed. All right. After we cut all that down, all right, believe it or not, the meeting with the departments, in my opinion, become moot because I got to cut everything that I can contractual. I
we're not I can't cut because it's a contractual, but there's other items that I can look at to cut. And we're here today. And the reason my department people, some of the departments are here today is they understand that everything is on the table to get us in in these
caps right now. Dawn has been working dilig service. All right? And she's been working real hard at it. However, I'm at a point, Don, correct me if I'm wrong here, between $7 and $800,000 that we
still have to find in the budget. All right, in order for us to get a balanced budget that's within the caps. And honestly, that is the challenge today. And so, we talk about that. How are we going to do that? All right. Um, we met with the but with the departments once.
I I anticipate meeting with them again and first giving them the option of saving us some money. Where can we cut your budget, right? Because it's no longer wants or anything like that. It's going to be what what do you need to get us to the end of the year? This this is
kind of common sense budgeting. You do it with your own. Uh but that is where we're at today. And I know we're kind of dabbling around it, but I I I kind of come straight at it with you guys. Well, with the 7030 uh percentages you're presenting, it's a little bit different
than I think we originally discussed or um just looked at at a glance. I mean, I we had it about 50% healthcare. We added about 25% legal fees. I haven't heard one thing about legal fees and that's rolled into your your percentage portion
here. But I I that's what that's an area we can control and manage. And then you had 25% for salary and adjustments, right? So that that was looking at that. So when you roll up now you're taking 7030 those numbers are getting blended. So I'm not I'm not convinced that that's the way we need to communicate that.
>> I know it's easier to to understand that way and you're not too far off. We can be raw with that. You we can go 502525 and and yes the emergency appropriation last year for $250,000 that went to entirely legal costs. All right. That covered a lot and we had a couple of
activities going on that required that. All right. That's there. It's it's plain as day. It's marked as the emergency appropriation and and that is what that is, Mike. And uh I was drilling down a little bit more though to kind of show how heavy a hit the health is really
hitting us. All right. And it it is it it squeezes the other ones a little smaller when you when you have to divide that pie up. Um but the the problem at hand right now, I mean, believe it or not, Nixon out that capital improvement plan of 1.8 million, that saves us a lot
of money. And you know, the capital improvement plan, what it's used for on all the departments is paving the roads, buying equipment, taking on uh specified projects that those departments have. They're going to have to wait a year. All right? Because of the situation
we're in, all right? And and so to me, I'm what I'm nervous about is we got to find money to to to to address that 700 $800,000 right now. And I'll be honest with you, I'm concerned about next year. Uh who who who's going to know what the
health insurance increases are going to be next year? All right, we have a hiring freeze. Now that I have a hiring freeze, well, I'm thinking about now when people do leave, we're depending on what the position is, we're not going to fill it. All right, but even that I
don't know if it's enough. All right. And and I'm I lean on the on the finance team. Um I keep you folks aware. I keep the public aware of the situation we're in. Um, I'm really not keen on going back and blaming and pointing and all that. I think we all know what's going
on. I really want to just look forward, get this addressed, get a get a um a solution to this and and have it presented to you on the 24th meeting. All right. Question is, I got to find $700,000. All right. Um,
I've been dabbling around it. I've been the guy telling you about the vet tax. I know everybody wants to save that, but that's 275. That could really really really help us right now. Please consider uh acting on that uh while
we're in the the the state we're in. And uh you know what, if we you know, we could always reinstate it when we're in better financial times. Um meanwhile, they they still earn the the 100% disability. They still are tax free moving forward. Um I I I think we we we
we all have the the utmost respect for for the veterans and all and we all mean well. However, this this is really, you know, encroaching on the operations of the town, >> right? And but what just to talk about that we're we're trying to manage to a
spreadsheet right now. The other half of this equation that we need to discuss and I'm hoping it's going to be discussed is on the revenue side. you know, you're trying to manage to a spreadsheet to get this to balance out and and reconcile the the shortage of
revenues coming into this township need to also be a key prior priority and focus. The revenues goes up, a lot of these stress points go away. And it's a simple math equation. All right. And I do want to spend some time and that's why I was asking about the format is
because we're going to get into the granular aspects of how are we skinning this cat? How are we saving? Where are we going to find XYZ amount of dollars? And there may be a a quicker fix or or a more consistent fix going in and supporting next year as well if we focus
on revenue streams and where that revenue comes from. So at some point in this conversation, I'd like to see, you know, other than taxes, there are a few other additional revenue streams, i.e. our, you know, the ratables, the and you could go into that,
>> right? We we talked about that. I I'm my only concern with that, Mike, is is timing. Like, we need the revenue now. I I I think we're we're working towards getting it as we move along in the year. Uh some good stuff is happening. We're seeing activity and that's all good, but right now we're working on an
abbreviated budget and uh we need to pass submit a a balanced budget to the state. All right. Um so, we kind of have to do that. I your point's well taken and and that that is the reason for my optimism for next year because we are starting to see activity. We're starting
to see the potential for revenue streams coming in. Uh you all have done some some really good proactive uh measures to do that. I I'm looking forward to that. But unfortunately, we're kind of in a crisis right now that has to get resolved. And and I'll be honest with you, I'm not putting on you guys to
decide how to do it. That's kind of my job. it it's my my finance team job. Uh I got to get a balanced budget to you. But I I want you to be aware though of of the environment we're working in right now and kind of why. And I you all get that. But um again, my intention is
to go back to all the departments and and skin it even more. Can I find the the the 700,000 to get us to the end of the year to to allow us to do a balanced budget? And then as Mike had said, if we can get those revenue streams going up,
you know, we'll be doing better both, you know, getting our fund balance back up, uh, managing our money the way it should be managed, uh, with with investment, with a a look to the future, and with being able to sustain a rough
patch like we're going through right now. Uh, that's what needs to to happen. I would like to just add too and correct me if I'm wrong this is different than it would be in a a corporate a private setting a corporate setting right because we need to definitely brainstorm revenue
opportunities but we can't assume those or build them into this now because of the type of entity we are right we have to plan for that and we need to write we need to like I know you're thinking I'm going where you are we need to make sure these are coming down the pike and we need to like plan for these and work hard to make sure that's the answer but we can't assume those now and submit a
budget based on forecasted or presumed revenues. Is that just to be fair? Okay. >> That's one that's one of the first things the state has us do. Either you have to substantiate your new revenues and and affirm it and or what you earned
last year is the highest you can go >> okay >> this year. >> Okay. So, and I >> okay to that that's a very important point just so we can so I I think people a natural question would be >> we have a 700 to 800,000 shortfall and the only means by which we're going to
deal with that shortfall is cutting right >> currently >> is that the only mechanism that we have as opposed to >> why don't we just raise revenue >> why that's why you have a levy cap and explain why you cannot just raise your way out of a 700 to 800,000 foot
shortfall >> before 2010. Yes, you could do that. >> Your tax your 9 to 10% number is raising revenue. >> That's that's raising revenue outside of the cap.
>> We have a cap raising 2010 in 2010 under smoke. Let's be straight. Like we have I I understand where Councilman Clark just stated. I get it. You You can't go and leverage and put projected revenue factors in. You need to submit a zero in
zero out reconciled budget to the state, but let's not ignore the revenue side of this conversation, please. >> Yes, you're correct. >> I mean, I'm not going to sit here all after all morning and ignore it because to find another 750, Jim had to cut it down a million and a half to get it to
three. He patched it up some more with the this 9 to 10. And now we're still looking toh scratch down another 7 500. Neil, what' you say, Neil? 500 750. if that's the exercise we want to get to today because I'm looking at this spreadsheet and it's tight. It's meaning
to begin with. All right. And I think, you know, we're we're all here in great spirit. I get I I get emotional because that's the point of this. I I see it. I I have suggestions and you're right a little bit. Corporate versus municipal environment. >> It's a little bit different environment,
but but a P&L statement and a balance sheet are the same. I don't think we're Yeah, but I don't think we're I think we're acknowledging we need revenue. We're just saying we can't commit to it >> today, right? >> Unless we can sign off on it and promise that we're not going to help you this year. Period. >> Not going to help us this year.
>> You can't. And also, for example, you couldn't raise the tax rate. So, say you wanted to figure out how much how would I raise $700,000? How could I increase the tax rate by a percentage by which that would make up Can you do that? Why? Why not? because we have to present a balanced budget to
the state or it's not going to get approved. >> Well, how would it not be a balanced budget? Because you're saying if I increase the bill the the tax rate by 0.05% that will raise revenue by $1 million. This is just hypothetical thereby making up the shortfall.
>> Is that is the levy cap tax levy cap? >> We are okay on the levy cap by if my the auditor is looking at this as well. If everything I have in is proper, we're good by $267,000.
Okay. The problem is we are 750 over on our spending cap. That's where we're having a problem. >> So you're saying just to clever, you're saying if we go up to our max on the tax levy, we're still >> on the spending side. >> So we can't go up further, >> right? >> Right. Not that we'd want to,
>> but on the what I was looking at my phone for because I sent spreadsheet last night that I wanted to do on my own. All the construction from 2018 to 2023
was up $718,000. Now, if you look at this sheet here, >> the surplus >> sheet, >> go to 2018, just above line nine, it
says amount to be raised. >> Okay. >> Yep. >> The first line under 218 was 17.3 million. Now, if you added $718,000 to 2023,
we would have been $18 million. In all that time, we would have been collecting taxes on that flat rate. That would be flat rate because you already had new ratables and taxed everybody the same. But now we're behind the curve and
we're trying to make up for when we should have been taxing instead of giving rebates. Okay. Yeah, that's where we're at. >> That's a comment. I I was I have this I wanted to make this comment too. So looking back looking back like to a few minutes ago that the overall picture here is this is a combination of
historical actions and decisions over many years plus the current environment that we're facing which is healthcare costs and some other factors that are going on now. Right. And I think that doesn't make it any easier for us, but lots of towns are facing similar issues with health care costs and other things.
Um, and just my own perspective is, you know, back to what we need to do. Everything's on the table, >> right? We wanted to be clear the meeting off saying, "Let's not go looking in the rearview mirror. Let's move forward." And we just went looking in the rearview mirror and looked at there's a lot of there's a lot of you could go even
deeper than that. You we're looking to find 750. Why don't we should look at where some of this extra spending uh overages occurred and I need to put legal fees out there. I need to we need to understand the impact the legal fees have created
>> to the shortfall here or the anticipated shortfall budget gap you have here. >> Correct. I agree. But the the reason I pointed what I did just out you were talking about revenues. Okay. and it's a culmination of things and there's where
the revenue should constantly be growing >> based upon the ratables and that's keeps you flat tax. Okay, not putting other items in. So there was a missed opportunity but I'm just nailing the head hitting the nail on the head by saying yes you're correct with the
revenues. I was just giving an example. >> Thank you. Okay. Thank you. >> Okay. >> So Mike. >> Yes sir. or Don with regards to raising revenue or raising not necessarily revenue but
raising funds. Are there items under the deficit spending budget that we have? Are there items that you could take out and you can fund with debt via debt via borrowings? >> Sure. >> You're going to pay for it,
>> right? But what happens is it's still something that you have to pay for. So >> of course it it I've never done it, but there is a mechanism where you can have sell your anticipated tax, but I think you're it's
you you're paying for the debt that you're going to get anyway. So in other words, >> I'm speaking above my head. We have we have a a large borrowing capacity here in Sparta because we have very little debt. >> It still has to be made up with taxes.
It's it doesn't matter. It it's what it what you're >> the mechanism that you're talking about is to pay for things that you don't have money for currently, but we bill quarterly. We get those funds in and we're rolling. Okay. So, we have that.
We don't need and don't want the additional expenditure of selling our tax levy to pay for things now that we can pay for over time. Anyway, >> I'm not I'm not asking about selling our tax levy. I'm asking about if a
household doesn't have the money to pay their bills, they in our household, we we borrow >> and then when we when we make some more money, we pay it off. Now that's tax >> that's that's tax sale. We do that every October.
>> So anybody who's out there that doesn't pay their bills, there's uh multiple corporations and individuals that come in and buy those. >> But you could find against that against the uncollected taxes >> is where Mark's going. You let's keep it
simple. You have you have your to Mark's residential or a personal approach to it. You're either going to go borrow money from a bank to cover your shortfall or you could take a home equity line to cover your shortfall. We all live like that, right? So, let's keep it simple enough funds to pay for such loans. >> But it's short. It's a short term. It's
short term as we build and grow out of this. We're not looking to finance this gap for 25 years. Maybe we we we take it to a three, five year until you could get rights. It's it's debt structure and financing that is an option here. So, I
just don't want to just ignore it in that regard. >> So, it's already it's already anticipated as a revenue. We anticipate a million dollars in um >> where's that >> heck is it called? It's >> in in net unsecured borrowings.
>> It's on the revenue side. >> In net secured borrowings. >> It's borrowing. No, it's it's it's uncollected taxes. >> Sure. >> Okay. It's uh what the heck is it actually called this? No, it's on a revenue side. You're not going to have it. Um >> the rut. >> Not the rut. >> No, it's not the rut.
It's um outstanding taxes. Okay, it's a million dollars. Last year you collected a million3 i.e. when it when the tax sale came, we collected that. So we anticipated a million dollars, we collected over that.
The $300,000 that was over that went into our uh fund balance. >> Okay. So how much >> Great point. How much is on the street right now? >> Uh in in uned tax because if we put that effort towards going to get the balance of money like you said we had a million
we did a million three so we we brought in three 300k. >> Okay. Our overall tax collection rate is 98.9 or eight. >> Okay. So there's not much outside. No. >> All right. We're doing fine. Matter of fact, ever since co we've been doing
great. So, okay, >> because people are paying attention, but >> it's it's already anticipated up to the level and there's a there's a whole different calculation on our annual financial sheet of how much we
can anticipate. So, a million dollars is a uh >> a good bas >> a good good basis for us of a 12 uh 1 point uh wait a second 12 million that we collect for the
municipality whether it be our county portion, school portion, library portion, whatever. So, but that is so it's less than 1%. Just to clarify too, not that we're ever want to go there, but we're not allowed to finance operational expenses anyway, right? Any debt would have to be for capital. Is
that correct? >> Correct. >> Okay. >> Yeah. The the selling the only reason you would sell your uh your taxes, so to speak, is because you need the funds immediately. >> Emergency. >> Yeah. Yeah. And it's that's Is it
selling or you're leveraging? >> You're you're leveraging. It's almost like when we had the >> leveraging, right? You're going to leverage a little bit of a percentage of a future tax revenue you're looking to take in in the short term to finance a gap. >> Yeah. >> And that's a that that could be fixed by a swipe of a pen. I'm not saying it's
going to get you there, but it is a mechanism we could look at. >> It's it's minimal. You're saying it's still minimal. >> Yeah. It's not it's not worth the expenditure. >> No, >> but it's leveraging that. It's not giving it away. >> You're not you're not you're not winning anything really.
>> You're getting your money up front, but invite you next year. >> I think it's an important point that um Mayor Bumemedi made, which is, you know, and it sort of tales into what Councilman Scott said. So, it's not like, you know, a normal household said, "Look, we have a $700,000 deficit this
year. Okay, we'll just go borrow $700,000." You can't do that. Whereas, say we had a capital project and you know, Jim has done very good work to say, "Look, maybe we can hold off $1.8 million." And if he said, "You know what? really can't that
we could float a bond to pay the to pay for that $1.8 million capital project, but what you can't do is say float a bond to cover our shortfall uh in expenditures. Got it. So, so what you just described is basically you're
selling a bond for a particular project >> or equipment and what you're doing is you're leveraging it for Mike's term over the life of that project. A life life of anticipation of that project whether it be equipment or a road. So
maybe a road be 20 years piece of equipment. >> Two different types of bonds, right? There's two different types of bond structures here. One one's to fi go out to the market to bond and do projects and the other one's >> one's called a revenue bond and the
other's called the general obligation bond. >> Okay. Why don't we and >> and just to stay on the bond thing right now and I think you know manager Zep you could talk about it. You could you could um restructure your debt to Mark's
earlier point. We could we could roll that back and I don't I know bonds have restrictions and I understand it but is there if if have we looked at maybe restructuring or reissuing and consolidating our debt and re reissuing bonds to offset and and get a little bit
more of a >> it was done in 2024. We done it. We It was done. Exactly. >> And you have to >> the guys is you have to save three and a half% of the total whether it be the uh Yeah. the principal and interest. You
have to save three and a half%. >> And where were the rates at that time? The bond rates. >> I can't answer that question. >> They were lower. >> They were low. >> Yeah. >> And they're up now. They're higher now. At the point the point or two higher. >> Yeah. >> We make It's like refinancing your mortgage, folks.
>> Yeah. when you go out and you want to try to refinance your mortgage to bring down your debt service. No, no, no different. >> And I don't I don't want to say sharks, but there people out there that I've worked with before. They're watching your debt structure. We have to post that information on the web.
>> Regulated and monitored. I >> And if if the savings comes in into play, they're going to come knocking at your door. >> Oh, yeah. >> Yeah. So, that's my no different than the bank I'm borrowing money from right now. I'm not sure I understand that last statement.
Are you talking about the rating agencies? >> I'm not sure I understand. >> No, not the rating agencies. There's there's bond uh buyers out there that they watch what you're doing and they're looking. They know that if you save money, they're they're making money on
top of you saving money. >> Okay? So, they're out there. They're going to watch your bonds. Mhm. >> They they do it for everybody, not just municipalities, but there's a group that does a lot of municipalities, but >> And our rating is pretty good right now, right? Our rating did not go down.
>> What is our rating? >> I I think it's gone down. I think it's gone down a little bit. >> But it's still a sing a double A or a single or a single A. Correct. >> You want to be a triple A or 4 A's. So, uh I think right now we're pretty much at two.
>> We're doing We're in the A. Yes. I don't think it's lower than double A. Is it >> not lower than double, but I think we were never we were never four. We were only ever three. And I think now they've warned us that we're leaning towards a two. >> Do we as a Mr. High even have the I
thought that there's some limitation based based on the size of our township that we don't there's not possible to get a certain bond rating. Like there's a top that only certain I don't think we ever qualify for a four. I think we were at the highest we could be which was a three.
>> Okay. So, what you're saying we could never be a four regardless of how um great our revenue stream is because the the way the bond rating agencies they kind of break it up into the way the township is structured. So, is that right that a four wouldn't apply to us
regardless of our financial situation? >> Right. >> Yes. >> Okay. I know we went off on a tangent, but I did post the the annual debt statement not too long ago, and the town hasn't bonded for projects in a long time. We've we've paid most of our projects with cash. >> We're still paying them for that bond
loan that we >> Right. But it it is minimal, though. Uh you look at a lot of other towns, uh they have a lot higher uh uh um debt rate than we do. Um you know, it puts us in a position that >> that was a business decision, right? that was either self fund it
>> it was taken advantage of in 24 taken advantage of opportunity where we consolidated all our debt into one bond and >> we refinanced >> and and it worked out pretty well for us. Uh as you know most of the debt is in the utilities not even with the town.
>> Um but we're doing well. We're positioned that if something came upon us and we needed to to fund it, we could probably do it very easily. Uh with our >> where it's always been for like the past 10 years, under 1% is where this town has always kept it. So you're right
where you are and where you always have. >> That's fantastic. That's >> okay. >> So that's where you are. >> So we go back to the $700,000 problem. Yes. >> Again, I'm I'm asking the council to consider the the vet tax benefit. That's 275 right there. that would help us
tremendously, you know, bring us down to almost looking for a half a million dollars. Um, the finance team and myself will be going back to the OE lines line by line, item by item, talking to each department head, finding where we can trim.
>> I did that last night and I went through and I shaved off a little more. That's what got my number down to needing about $742,000. and Gene Monzarano was very kind enough to go through her budget and call me up and tell me where I could cut on her side. So, if we can meet with other
departments, but you're right, we're we're pretty much running as lean as we were. There's really not a lot of increases. And and if I'm reading this right, there's no line item for our fire
department other than the $16,000 >> one that we went back and forth on in one of our meetings a few weeks ago. >> Don't confuse that with fire >> prevention. That wasn't fire department. >> The fire department um >> department has >> fire department hasn't changed. fire department hasn't changed and and in
fact >> to their benefit because of the shared service agreement that we did and you folks recently uh approved of the sale of the two vehicles >> I we're keeping that the money of the vehicles and all that I have that and that can only be used for fire
department >> so they have some money there uh uh for this year for they usually are asking for turnout gear and and equipment for uh >> and we left volunteers right uh and So, >> so they have a budget, >> but we do we do have some money for them
there. >> Budget is the same as last year. That's not changing. >> I didn't touch that. They're still budget. They're still slated in for the $71,000 they've been getting every year. >> Thank Thank you for clarifying that. >> Okay. >> Same with the first aid squad. >> Mhm.
>> Yes. I just went online and looked at our annual debt statement at 0.094. Most municipalities around.3. So we're we're >> higher than others, but >> No, no, that we're way down.
>> We're way down. >> Three. >> No. >> Yeah, we are down. >> It's great job under the circumstances. It's I I know what it takes to do that. So to be crystal clear, our debt level is at a third of what other
municipalities are in average. >> Typical. Yeah. >> Thank you. >> I mean, looking through these sheets, and I'm going to say something that's not popular, and I don't like to say it. When you look at the column that shows the differences, right, across all these,
the ones that jump out dramatically are the contractual salary and wage increases. I mean, that's just just to state the obvious, but in case people haven't seen that or might not rec recognize that, but >> yeah, that's those
>> those were commitments made to the bargaining units and depending on the length of the of the contracts. >> Um I have two contracts that are open right now that we're negotiating. The S SOA contract is open, right? Not S SOA, the uh rank and file contract is open
and the dispatchers are open. And obviously, uh, we're going to be looking at those in a in a different light, um, right now. Um, however, the other ones were obligated to because of the length of their contract. Uh, you know, I know, uh,
DPW's contract expires at the end of this year. Um, and they have a a supervisor's union and and the rank and file union for DPW. Those both expire at the end of this year. Meanwhile, I have two open contracts with uh PD dispatchers and rank and file.
>> Yeah. >> I'm just saying not nothing everything on here that we do in this town is critical, but when you just look at the math, >> just a couple of those line items alone are 800,000 >> in increases. Yes. >> Right. Okay. >> That's because you're looking at the increases. Usually there's a step system.
>> Uh you're also looking at the benefits of education. You're looking at the benefits of um a lot of built in. Each contract has its own structure to it, but yes, it's it's they're generous uh in in from a lens that we're looking at
today. >> Yeah. Well, I mean, it's the spirit of what we're trying to do here today and um what we're, you know, we're trying to, you know, balance, you know, balance and pass a budget. But I think in the spirit of what we're doing, we should, you know, although yes, salaries and and
salaries are usually always the biggest expense in any corp corporate or municipal structure possible, we should not be looking at any cuts or or layoffs or any of the like to the employees and staff right now. That's my position on it. I would love in the spirit of that
to really go granular if we need to because there's a number of other areas we could flip rocks before we just start looking at a big ticket item. The larger the number, the larger the number looks really ugly and red over here. But there are places that we could and it's tight.
I see it. But it's tight that we could maybe in the spirit of what we're what what I'm saying at least that we should try to look at other, you know, to really skin this down. Um >> Mike, I would agree. Just again your going your tone of the meeting full say it up front full transparency. We look
under every rock every every rock. Y >> so we don't leave anything unturned because >> we can't ignore the fact. Right. Either we're going to cut we have to cut somewhere. Right. >> Right. Either it's programs people whatever it is we need to get to something balanced. Right. So >> I'm not suggesting you're saying we don't look under certain rocks. I'm just
saying this is the facts are here. Right. And so when you pass the budgets and I know that I I understand it lags this is right you're going 12 24 months these are these are budgets right versus actuals that were spent against it was
the there was some departments that went a little slightly over there's some departments that managed really well that kept a little bit or kept under it was the the money that was earmarked on how does that money get clawed back and recaptured or is it just go linear
across the spreadsheet into the following year. >> Some of that was >> actually Dawn, please use this. I'm sorry. Yeah, >> some of those was also used for your budget transfers. That's how you look at it. You go in, you see which departments. I'll throw one one department out. I'm not going to put names out because again, we can't talk
in public about that. One department we had a gentleman retire. The replacement was less money, but that money was left in there. the salary line. The budget had already been passed, but when we needed to do transfers to get those that were in the negative out, that's where
it came from. Now, what happens is this budget for 2025, all those accounts that have money in them are now in a reserve, a 203. The account number changes from 2011 to 203. It's last year's money that's there to pay for the bills that weren't paid for
in 2025. And then the end of this year, what's left in 2025 will lapse back into the fund balance, but we're only looking at >> Tell them she go to sheet. >> Yeah. Go to go to go to your surplus
analysis sheet five. It's in red. Unexpended budgets at the end of the second year. Okay. We're looking right now at possibly having $472,000 left in 2025. Don, if I can interrupt, can you uh just
navigate all of us to where you're looking? What sheet? >> I'm on your third plus analysis. >> Five on the first page. >> Yes. See it in red. Number five on the first. >> Okay. >> Yes. So, those are what was rolled in. Those dollar amounts. You know, look at
2018 had $1.5 million left. We keep hitting that line still because we still have invoices for 2025 that are still not paid. So let me ask a similar question building on that. So when we look at
2026 what we're thinking of the budget right for a certain line item are we comparing it to the 2025 budget or we comparing it as the gap to the 2025 actuals? I think that's kind of the question as well. >> So I'm looking at what they spent last year. So what we were giving them I take
their actual number and I say you didn't spend that much money so you're not getting that much money. >> Okay. So when we look at the this fivepage sheet that you gave us. >> Yes. >> The item that says 2025 final right the middle column >> the final budget budget after
>> is that budget or is it actuals? >> That's act that's after we had to do any of those adjustments in the column before it. That's what was left there and that's what was spent. >> That was spent. Okay. >> Yes. >> Okay. >> And excuse me, Don to be clear. Let's to go back a minute
or so. We were talking about the transfers at the end of the year. And that's just moving money from one bucket to another, one department to another. It is not this nefarious no >> thing that we get accused of every year by certain members of the public.
>> Technically, this is one business, one TIN number. Everybody gets their allocations. >> If it needs to be moved at the end of the year, it needs to be moved just because it's in your department line >> and it's done in all 500 municipalities in the state. >> Everyone, every state. Yes. Every municipality in the state.
>> Thank you. 565 plus again, >> right? You have November, December to make sure that your budget line items don't go over expended. That's your first transfer section. November, I'm sorry, uh January,
February, March, you have the same caveat, three months to make sure that you don't overexpend any line item. Okay? You have a balanced budget and balanced revenues. Hopefully your revenues you have little extra. You
collected more somewhere where your UCCC or your fire codes or your uh you had a lot of extra weddings going on. That all goes into surplus. Two years down the road, whatever you didn't spend in that budget comes back in as and it helps our
surplus. Whatever you didn't spend. So if you're thrifty, you're helping us out two years down the road. Yes. >> For that. >> Okay. So, we're always looking to get all those revenues and we're trying to make sure that we don't spend every dime. >> Yeah. >> Okay.
>> Just a question about five. So, in 2025, um, we allocated 472,000 more than was actually spent. Is that right? >> You're looking at Oh, no. >> No. That's what we didn't spend. >> That's what I said. That we did not
spend >> $472,000. That's correct. >> Uh that's what I'm hoping for. Uh once we get our um >> March isn't done yet. >> Our whatchamacallit. No, no, that's for 2024. >> Oh, I'm looking at 2025. >> It's in 2025, but that's 2024's budgets
unspent. Yep. >> And the annual financial statement from the auditor is going to hopefully confirm that number. Hopefully, it's not going to go down. >> If I can finish my question. Um, so in determining the 2026 budget for
departments, you took the $472,000 into account. Did not say, listen, you did not just let me finish. Um, you did not spend, let's say the recck department didn't spend $100,000 in 2025. Did you say, "Okay, rec department, you didn't spend $100,000.
Therefore, your budget this year is going to be diminished by $100,000." Yes, but you're thinking in nonp parallels that 472 is left over from 2024.
>> We look at in 2025 what they didn't spend in constructor 26 budget. >> Okay. >> Yeah. >> And we don't yet have an idea of about what they did not what departments did not spend in 20. >> We do because 25 is basically done.
>> Basically about done. Okay. >> Well, the exception would be any pending bills that come in late. Let me just wrapping everything up now. Okay. >> From March, >> correct? >> From 2018 to current 2025, every single budget based on what we're discussing
right now has had this. There's never been a negative. You've always had extra that rolled over into following year or >> Yes. And I don't know what would happen if the state found out that you spent more than you allocated. >> All right. So if we took a took all that all that roll over money, right? Take a
percentage average divide it by what you could kind of get a placeholder what you can anticipate for next year. >> It's already there. >> It's already there. >> Your 475 is your adjusted actual. Correct. Your 472. >> No, that's that's what you haven't spent
of 24 money. So you're >> 2024, correct? Okay. >> So, from 1 1.522 in 2018 to current that >> follow me. Just go linear. Just help me understand this please >> because we've spent more. >> I'm looking at 2018 and I don't I don't
really like to look that far back and that's fantastic that all the departments are diligent in managing and trying to keep to their budgets and the budgets are >> and that's actually leftover >> 26 money. I'm sorry, 2016's money. 2000.
Yeah. >> Okay. But you're behind. >> So that money is not a >> it's not lining up and rolling over. It's being it's being depleted as it goes in through through the across the board. Yes. Correct. >> That that drops the fund balance i.e.
surplus. Okay. >> That you guys call it >> and we utilize that the next year keeps you know it grows it gets used and that's what the whole purpose of the budget is. It is a moving target. It is a living beast that you have to follow
the ins and outs to make it sure that you're not overt taxing the public and we we're not because we're constantly reusing. We have the setup of the uh reserve front collected taxes. We hope that helps us replenish our surplus that
we use. So it's it's a rolling item just like the budget that hasn't been spent. It keeps on coming back in. >> It may be less, it may be more. Yeah. And Mike, that that 472 is already built into the 2026. It's >> it's built in as far as what we hope is
going back into surplus, >> give or take a plus or minus, but there's it's already it's not like with newfound money that's already built into now and assumed for 2026, right? Okay. >> It's money you've already it's money you've already collected on the revenues from, you know, of your balanced budget from 24. >> Okay. Councilman Clark, did you finish?
I'm sorry. >> Yeah. No, that's helpful. I was just trying to drill down to you've already met with the departments to say, you know, we're going to set what we think your budget should be based upon what you spent the previous year and if you
didn't spend, you know, an ex, you know, $100,000, then this year you're going to be reduced by $100,000. So, you've already tried to keep the departments within the previous year's budget. >> Yes. >> Okay. Got you. I just want to elaborate
on that because both uh uh deputy mayor and you guys are talking about when we talk about the departments and their lines and they come in and and they we talk about uh the future year the next year uh we do look at their actual spending we look at uh what their goals
are uh driving their their their departments. Um and you have, you know, all the dynamics that go on where you have staff coming and going, adding, deleting. Um when you get the increases, right, we have to approve those
increases. All right? And make sure that one is they're affordable. Two, they're necessary. Um unfortunately, you guys are seeing a ton of inflation right now. um the fleet budget uh for the vehicles has has gone up because the cost of of
parts, tires, fuel, everything is gone up and so you're going to see an uptick on that. We try and budget above so so that we stay above it. But there are times though when when you look at the actual expenses and that's when uh Dawn needs to do transfers to cover those
deficits and that's how they occur. They weren't so much anticipated. Then what you get into is okay the department head is running that department and we say okay we know what you've spent we can get you down to there what can you go without for this year and let us let us
cut it even more that's where we're at today right now and that's like uh Jean from parks has been very proactive. She's already come to us and said guys you're hurting for money you can cut this. Um, unfortunately, I remember when
I was in this position several years ago and the manager asked me, "Jim, for DPW, what can you cut?" I said, "Well, line striping is an expensive task. It's $20,000 at the time." Uh, I said, "I can forego that for a year. You know, we can
get along with with the lines the way they are for a year. So, we cut that out." and you're able to to cut more in the O and try and make it as minimal effective to the services to the town. That's where we're at right now. And
next week, uh the finance team and I, we're going to go back with the departments. The chief has already approached me and said, I can help. I there's some areas that we can help and we're in this together to cut it. um you know be cognizant of it all and know
that you know what we would like to get back to where we were uh but in the meantime uh you you know we're going to try and and make a go of it to the end of the year where you know no one's saying it but I want to avoid staff reductions. I really really do and
that's what we're here for today this morning to talk about >> and also so we're we are into in this together right so we have the team right we have the department heads and us on the deis and our eventual job is to determine what's the least pain to the
resident right is it cutting down on services is it raising taxes or you know having a higher tax rate at some there's got to be some balancing point right so example not striping the streets for a year I'd imagine Most residents can probably live with that depending on what the tax impact would be. So our job is going to
be to decide on program services hopefully not any headcount and figure out what's the least pain, what's the right balance point for the tax increases and the services and that we provide. Right. >> You're you're spot on. So right now I'm telling you that the the finance team and I are going to go back to the
departments and scrutinize what we can do. If there's still a shortfall, then I got to come to count. Well, then I got to go to council and say, "Hey, you know what? Now I'm looking at the celebratory events, the Fourth of July parade, the Memorial Day, Sparta Day." All right.
All those events cost the town money. All right. Can the town go without that event? And are you prepared to answer your constituents on why that that is the this we're doing the tough stuff here. That that is the tough stuff. We're not there yet, but it is my
duty to inform you of what's happening, what's occurring. Um, I will make those suggestions to you and say, "Hey, I'm able to balance it, but you're going to have to go without this, and you have to be prepared to tell the constituents why." >> May I offer a suggestion, too? Is yet,
if we if you, and you live it, and Don, you live it. You're looking at the P&L. you're looking at a rolledup P&L or a really broken down unconsolidated detailed P&L. If you look at the comparisons and you do the the pluses and minuses and the the major
discretionary increases and decreases to each of those line items, can you kindly flip every we're we're talking about departmental. >> I've already gone through >> Let me let me finish, Don. I I because I know when I have to go through this exercise,
I keep on I do it a few times. All right. And can you kindly look at legal fees, professional services, because if you look at the if you take a if you take a five-year and it's just say an average a fiveyear average of
those line items, you know, as a baseline, as you were saying, is trying to establish baselines and getting numbers in here, right? But look at the actuals. I'm sure those increases I mean there are other areas outside of our discussion so far that we should be looking at and everything's on the table
and I'd hate to say that and you know it's just the cost of doing business right if we're going to tighten our belts we got to look at our legal fees we got to look at all our expenses not and our and our professional services as well I mean if we're talking about
cuts to our staff and our professionals are just operating as, you know, and they go through a a vetting process. I understand. I'm not being disrespectful, but they're they're not in the discussion. I need to bring them into this discussion. And I'm sorry. I mean,
it's just matter of fact. I mean, >> it's it's just something I I need a commitment that >> somehow whether we report back to this that the legal fees I know I know the number I know the numbers up substantially from 200. You have a $200,000 baseline of legal fees. I
that's your flat base based on everything I just kind of gave you an example and this year alone you're four almost four times higher than that that baseline >> and that's correct that's not correct
it's not $800,000 the taxes are not $800,000 correct >> that's a data point it's a fact >> the legal fees are not $800,000 >> it is a fact then Mark why you I'm asking Mr. up. Let him answer the question. I mean, >> I I put that under the umbrella of
professional services. All right. So, that also includes your engineers, your planners, there's a lot of the analysis that I have here would say that um uh Council Deputy Mayor Sylvester points well taken. Uh we can look at legal
stuff. Um that's the unanticipated part because the the courts and all that we've been living through, it's unanticipated what's going to happen. We've had some success recently with some settlements and stuff like that. So hopefully, you know, it stays within bounds, but
again, we don't talk about this, but if we enter, if we get a balanced budget, we can cut some of that stuff, but then when we can't afford to pay anymore, I come back to you guys and we do an emergency appropriation yet again. >> And that's one thing I just wanted to touch on only because Mr. Bulmeti had
made a comment the other day that he didn't understand where that came from. So, I just want to put that out there so you know, anytime you take an emergency appropriation out, as we did this year for what, $250,000, you're borrowing off next year's taxes. So, you already put us in a debt of
$250,000 just to start this year off. >> Wait one second. Let's just clarify. Excuse me. I just want you to clarify what you said though about a one-year payback because there are certain circumstances where emergency appropriations can be paid back over three years, I believe. Right. Those those other things that you're looking
at are notes that are due for tax reval or >> Well, no. For instance, the master plan years ago, we're looking at financing master plan through emergency appropriations for over paying back over three years. >> Yes. But it wasn't that expensive. So, there was no sense in doing it at the time. >> Okay. Because it wasn't as much as you
thought it was going to be. >> But when you when you pass an emergency appropriation, you are taking money from next year's taxes. So, you're starting me with a debt to begin with. >> Okay. May Mayor, thank you. Thank you, Mayor. >> We just had an earlier discussion about
why would we go ahead and finance against future taxes, but yet we just use that as a vehicle to go get emergency appropriations. Is that what I heard? I'm just It's not to be don't It's not argumentative. It's not
attacking. It's just I understanding we did we did exactly what we just talked about earlier to Mark's earlier point of trying to maybe go and and borrow money to take care of this debt. But on an emergency appropriation, say we have to
come in for another half a million dollars or a million dollars worth of legal fees this year, we are going to come to this council. We're going to ask for an emergency appropriation of which is then leveraged by the future taxes. Is that correct? And finance that way. So what you're saying in a sense is if I
go in and cut legal fee spendings now, you want me to cut legal fee spendings now to bring the gap down so that when we run out of money, we'll just take an emergency appropriation against next year. >> Well, I would I would I would recommend I would recommend it's it's your you're
the architects of this. I think you it could be a combination of both lower expenses and then leverage and finance and but build yourself a little bit of a slush fund. So we don't have to come out with this emergency. >> It will get you some, but it's not going to get you all of this because we only
budgeted for what you were budgeted for last year prior to the emergency appropriation. >> You're smiling at me. I like that. I don't know if you're smiling cuz you want me to get up a donut and be quiet or I don't know what you're doing. >> Up here. I'm smiling because I have two fists,
right? I said before we had a balanced budget. >> You already made it in balance and you're already playing with your next year's >> because you already know that you're going to be short over here. >> We're only on the right side of this equation. Why don't >> you know you're not borrowing, you know,
by going out to an institution, but you are borrowing against your future tax. >> If we're looking, if we're looking for what's your gap again? I 750 >> 742 >> 74. Okay. Let's let's should be generous. Okay. 750 and let's anticipate and and we and
and we are the professionals are moving trying to settle and mediate or mitigate these lawsuits. So the more that comes down the legal fees start balancing back to the waterline at 200 300k. Let's let's anticipate that and maybe go
borrow to cover that. If we use it, we use it. If we don't, we don't. But at least you could build it into the You're trying to build this model to pass the state. >> You can't borrow ahead of time. You can't borrow this ahead of time. You can't >> you can't put a line item in this. And when you put your budget >> because I have to ask the state for
permission to do this. >> I have to you have to pass a resolution and I have to send it to the state and the state. >> But we're going to pass an emergency resolution. If if three months go by and all of a sudden comes to council says, "Hey, I need a half a million dollars or a million dollars." We're doing it then anyway.
>> That's different. That's different. That's a that's a formalized process to get it done. >> Look, I'm just trying to be creative. I was gonna say you are being creative, but I give you credit. I do give you credit here. You're being you're trying to be creative, but you're kicking the can down the road anyway. So, it doesn't matter. You're going to pay for it regardless.
>> Let's talk about kicking this can down the road. I'm not saying let's go take a half a million dollars and finance it for the next 50 years because if we do the other side of the equation of growing our revenue and strengthening our our our our businesses and bringing in new projects and new businesses and
and getting better stronger ratables and and all that other stuff that supports revenue with even the tax increase that's being suggested we could pay that you'll be you could pay that off. We're not I'm not looking to finance that over a 50-year period. You could pay it off in two three years
>> if we're Our operating expenses are tight now. So if I bring that money in, where am I getting the money to pay for the loan if I'm already at bare bones? >> Interest payments. We have to find interest payments somewhere. >> You know, where would I where would I get that from? >> I'm just g I'm throwing it all out there, guys. >> You're throwing it out there, but it's
still structured in the fact that you're playing against your future year and you're going to have to pay for it that year. >> We're talking about a mosqu it's like a mosquito bite to that. I mean, we you're talking about seven nine to 10% tax increase. I'm I'm talking about just going out and patching this up and this
meeting's over. We can end this meeting right now by going to do this and and we're sitting here and I'm getting beat up. You're going to be sitting here next year. >> It is not a fast process. >> It is not a fast process first of all in time for your budget.
>> I'm only messing I'm I'm only trying to keep light of it. But you're not going to get I understand you. I appreciate what you do here. don't and and I these spreadsheets are they give you brain damage. I get it. All right. But they're
usually very conservative. You all come in with the conservative approach. I deal I'm saying your baselines are conservative. What I'm just saying is I want to I want to take what Councilman Scott said as cons into consideration. Sure, we should flip every rock and
lower every try to look at expenses, but if we can't to balance this budget, okay, so we submit it to the state, right? >> You can't >> you get check mark, but the day after we submit it, can we go to the market and then go get that money? >> No, we can't submit it to the state being unbalanced. They won't take it.
>> It's unbalanced. >> You know the process better than I do. I I Okay, I'm just trying to be creative here. That's all. How can the How can the state run a deficit budget and not allow us to >> We're off topic. Hold on, folks. Let's I want to bring the temperature down slightly. I know the enthusiasm is great. Let's take turns talking back and
forth. We need creativity, but let's just take it down level. >> Okay, let's Okay, let's go. I I just like think to go back and remind >> the audience here of what something that I mentioned last year. Last year when I was on the planning board, I mentioned
to the planning board that the professionals, the engineer, the planner and the lawyer, those people are paid for when they come to a meeting and XYZ
developer is sitting there selling his case of why they should have this development. These three parties, their bills are not build to the escrow accounts. And we were told by the head
of the planning board, by the by the head of the planning office, that that's not the way we do it in Sparta. We want to be user friendly. These people told us, the engineer and the and the planner said, "That's correct. We do not break
up our our bill and bill individual developers because we bill the town. Now, in every other town that these people work at, they bill the developers. And so, we are footing
$100,000 everyone of legal bills of of legal and planning bills for the developers. And why is that? Well, that's because whoever was who the planning and zoning department didn't want to didn't want to segregate the bills,
didn't want to break it up, didn't want to do the job that every other town in the state does. >> That's not true. >> Okay, Don, can you you would you like to reply? >> Yeah, that's not true. Um, when they're there and they're representing one developer, it is build to the developer escrow account. when they are here
representing Sparta Township's interest, it is build against their retainer. But I know because I process Develcco bills. I can't tell you how many I do, but there's a ton of them. So when they are here just for one specific purpose, yes, they build me. And
>> that makes sense. But when they're sitting over here, they should be billing the developer. If they're here on representing sported townships interest then no >> because they're not here for a development project. They're here on our >> and our planners and our engineers and
all our other professionals have been supporting us in lawsuits >> but also and that's not going into where >> but also I'll digress off by saying >> that really doesn't have anything to do with this. >> Yeah. So I think you were saying so while they're here during a planning board and zoning board meeting they're
representing the township that couple hours they're here the township is paying them all the other work all the other work that any professionals are doing on applications that goes into that goes into escrow. So the the delta the only difference we're talking about here is just when they're sitting in the meetings and that's a policy decision,
right? That could be changed or it could be the other side of it is that we don't want to we want to make things businessfriendly. We don't want to have an additional cost or maybe administratively it's not worth it. Whatever it is, there's other aspects. >> The girls are constantly going back getting more money when it's needed because the bills are coming in and there's not enough money in the
developer escrow line. So they will go back to the person for the project and say we need more money from you. But >> ju just so I'm clear. So if if an applicant comes in and they're anticipating a five session in front of the planning
board, I mean our application is going to take five separate sessions. When our professional was there adjudicating the application, that's built out of the retainer and not build to the developer who's presenting the application. All I that's all I know sir is when they're
here on the developer on the on the behalf of the project they can build a developer es escrow but when they're here for sparted township that's what goes against their retainer that goes against their monthly retainer >> that's a part of the cost of doing
business of running a planning board zoning board okay so >> have a meeting when you have no applications but you're still having the meeting and they're here >> we're paying for that makes sense but for those five sessions who's paying for that >> and they'll pay for the developer escrow if they're here just on the behalf of
the that project they will build the escrow account. >> Okay. So if the applicant if they're because theoretically they are representing Sparta Township when an applicant is in front of them. I mean >> some nights they're here and I develop them for many projects all at once. But
like an obvious one where we do build a developer is when the initial application comes in and our professional has to look >> for a myriad of things. They come through with all sorts of fees that are that are done. It's Yeah. >> Okay. >> I don't claim to know the ins and outs
of planning and zoning. I only know the ins and outs of billing. >> So to be clear, if there's just one developer here that night, their account gets built and the developer pays. But if there's two developers here that
night and two cases are solved, the town pays. >> No, they should. >> That's that's not not not what the head of planning and zoning said. >> I've seen the bills come through where they've been >> they broke it out to the >> break it out. >> That's not what that's not what the the engineer and the planner are saying that
they're doing. >> But all I can say is this. Again, this is getting way off top. >> Yeah, I think we're talking. >> No, we're looking for dollars. I'm not sure anything $100,000. And here it is. No, >> that's a that's part budgeted in here is
your contracts from these >> these that you passed. >> I No, I understand that it's not here. >> It's a it's a done deal, >> right? >> Because we're paying a retainer to the professionals anyway. They do lots of other things besides sit here three hour meeting, right? Let's let's see take a look to my earlier I started sorry I
started this conversation off again but I said can you kindly take a look at legal professional fees and and go detailed line by line on your throughout your P&L look for those those numbers where you're negative or where extra spending was done and look at your professional services
>> I only contracts I gave them what they got last year if they spent that much but comparative to this year if did they go over their contract values and we had to extend them, you know, for their services to support our township for
whatever reasons, lawsuits and all the and anything and the like supporting meetings. Did they exceed their contract values or we have to extend their contract values more to offset that because we've been in need further need or demand because that's an area we can
control and cut from our perspective as well. And Mark, your point's well taken. If there's we would love to have five applicants at a meeting right now and stay here. 2:00 in the morning and then they cross bill all five applicants in their escrow accounts. Correct on
>> but they're not doing that. >> They are not doing that. >> But we got to go back to them. That's that there's >> we'll definitely look at that council on that. >> That's all just asking for heads up >> buckets to find cash. Every rock we're going to over right look under.
>> So there's one rock to look under. >> Yep. the second council meeting in in March here, uh you're going to see three ordinance introductions for fee changes. >> One is land use, >> one is construction, and one is water. And you're going to see that we're
updating the fees in another attempt to bring in revenue and all. So, we are addressing a lot of this. The procedure that you're talking about, I I will have to look further into. Um I I know that the you know the escrow responsibility
um the more that we can do that the less of a hit the town takes and and we'll look out for a fair and equitable process that gets done that way. >> Okay. I want to I want to shift gears and just if I can focus on the health insurance part again, right? So the number I'm seeing on these sheets is
almost increase of almost $2 million. Right? So I I think it just deserves a few minutes of just focusing only on healthare. And I know, look, healthcare costs, it's a crisis in this country, right? It affects families, it affects businesses, it affects every town. I'm
sure that we're not alone. So, are there any alternatives? Are there any ways? And probably too late for this year perhaps, but is there any ways to try to lower those in terms of the premium costs we're paying? And that I'm not
sure if it's using a different broker or a different network. I mean, I know the state health benefit plan is probably, I think, even worse increases this year than the one we're in, but I just think this deserves a few minutes of conversation for something that's probably almost all out of our control or we're all facing it our probably our own personal premiums. It just deserves
a few minutes. Is there any alternatives? Is there any other way to start limiting the cost to the town of this health insurance increase? Because next year, I'm afraid what it's going to be next year. It's 2 million increase this year. Don't we don't we join with
with other municipalities in >> in sharing the healthcare with the same >> and and I just to to to answer the mayor's concern and and and know what we're up to is um if you were Dawn and I after the first pay period in January
all the employees >> uh had some tur language for us. Um, don't forget because of the chapter 78 obligation, most of their contributions went up 19.5% as well. Even though the town carries the bulk of it, the
employees carry a significant bulk, you know, and so a cola increase at 2 and a.5% doesn't mean anything to them when they're contributing, you know, 19.5% to their health insurance. So, we hear it. So, so what are we doing about it? We
have a risk manager who who sits with me in the HIF meetings. All right. This is the health insurance fund that that the Mars County uh uh belongs to. It's a North Jersey actually employment fund. Um we got several municipalities in there. It's run very well. Um they're
they're in the same boat as us. They're they're upset. They're they're in the same thing. Ours was 19 and a half. The state up to 26 35%. the state was, you know, a lot and a lot of towns pulled out of the state. Um, some towns are looking at self- insurance. They're
looking at alternatives. They're looking at different plans, different methods of of skin in the cat to address the health. Our risk manager right now is diligently working at getting different plans that we could possibly utilize to get the cost down.
There is a caveat that uh Deputy Sylvester and I were discussing and that is is that you do have the obligations to the collective bargaining units. They need to be pulled into the conversation. Uh they they use the term equal or better. Uh they want to make sure that
their benefits aren't compromised which is understandable. So when we do these reductions uh it has to be you know parlayed with uh uh cooperating collaborating with the bargaining units as well. So it is a process. It's
complicated. I do have our risk manager working on it. Uh I'm always looking at other towns how you know can they do it better? Um, you also have to be aware that your costs um are affected by uh how many employees
are are sickly and how many are severely sickly because you you're paying for that as a pool. And so your cost loss ratio they call and all that is significant. Um if you're a small town and you don't have a lot of sick people, you can do pretty well. You'll be okay.
But when you have a big pool, uh you you know it's a it's a factor to be considered. And so it's not as simple as just changing plans or whatever there there's a lot involved in it and and there is um analysis being done. Um my personal opinion um just throwing more
money at the problem which everyone is doing right now doesn't solve it. Um and and the new governor it's on her plate now too. I'm really curious to see what happens uh how this gets addressed because um only so much can be addressed through uh plan manipulations.
>> Yeah. I'm not sure what the cuto off is where it's logical to be self-insured. I think it's a lot bigger than we are probably right. Uh to be a self-insured plan >> it is and we have looked at that if you recall year and a half ago I looked at that and um
>> right now our cost loss ratio doesn't make us really attractive to be selfinsured. >> Okay. So then the other approach obviously is changing behavior and wellness programs, right? And you know giving incentives. A lot of companies do this, right? You give incentives for
people to get their numbers checked and and to engage more with the healthare system earlier so it lowers our long-term costs. Being we're part of a a collaborative group though, I'm not sure if we would see those benefits right away to our premiums because we are being shared in a large collaborative portal. We we are a participant in a
wellness program with the HIF and we have several members involved in town and I like to think that we do get the benefit of of healthier employees. Uh there is an incentive that you know if they follow the the physical the dentals the the the benchmarks that they have to
abide by um they could get $250 as an incentive. >> Okay. >> And is that direct does that affect our rates? >> Uh not so much our rates. Um I I I like to think we're not getting claims so much. >> It is based on claims. So it
>> it's an investment in the long term too. You're not going to you might see a little bit unfortunately a little bit upfront cost, right? And then down the road you see the investment paying off >> but we're looking at it. It is the biggest hit right now and and we are substantially looking at it. Uh Chief McCarrick has been contributing uh you
know stuff that he finds with other towns and other situations that he is able he's come in and and and talked about it. So I have our risk manager who is our consultant. He he is working on it and he works with other towns as well. He doesn't just do Sparta. So it
it would be a benefit to a lot of people if we can find a better way to to do this. >> But it's also the health insurance is one of the prime inducements for people to take municipal jobs in the first place. You know because um as opposed to the private sector, a lot of the private sector doesn't give you as good a
benefits. But um that's the trade-off that people make and I know municipalities are having a difficult time actually recruiting people for jobs because towns are faced with the you know increasing health care costs trying to lower some of the benefits. But um and it's also outside our control the
practices of the health care companies. Um as someone who's in this space there are a lot of anti-competitive practices done by our healthcare industry that drive up your costs. Um, and you know, there's attempts you can make to fix that, but we can't do that. We have no
control over their own business practices. >> System's broken. >> But I wanted to give you just a number to put things just in a little bit of perspective so you can see how hard this hits us. You bring a new employee in. You're starting them at $45,000 a year. They need a family plan. Family plan
cost $63,636 per family >> a year. >> Yeah. >> So your healthare costs are more than the salary. >> That's what we're being build. Then we take off their contributions which if they're at 35%, >> you know, on a $45,000 salary, 35%
probably isn't. They're not even at 35%. So you're not going to get >> but maybe less than $10,000 in from that employee on contributions. So, you're still footing out $53,000 of the bill. >> Wow. >> I actually had that down with me somewhere because I had
>> Wow. >> actually what we were build for, what we paid out in contributions. I can get it on the break if you really want good numbers and what we're actually still responsible for. >> Yeah. >> Okay. >> A health bill alone is probably $7 million. >> Yeah.
>> Before contributions. >> Yeah. Okay. Um, if there's are there any other comments just on the healthcare because I want to get to a recess actually and we're kind of waiting here so we just do like a 10-minute recess. Any other comments on healthcare costs or this topic before we do a quick
>> other than just the action item that uh manager Zep's going to work with Chief McCarrick to continue to explore other options and working together and trying to look this has been forced down to us, right? It's it's landed in the private public sector the bigger issue but now
we just got to manage and admit try to make it work. >> He did that he talked to two other towns and how they're doing and he's got some really good information which is probably somewhere >> there's a lot of other towns out there facing the same >> problem. Yes. Yes. >> There's a lot of other towns out there that are doing different plans offering
incentives to their employees and saving a ton of money long term. We should be have looked into this already. >> It's the time now. October when when it's time to start thinking about insurance for the next year, it's time to do it now. >> Yeah. >> Thank you. >> Yep.
>> Thank you. >> Okay. Uh have a I'll make a motion for recess. >> And I'll just say um y'all can do it how you want, but maybe when we get back, you know, kind of drilling down recommendations on how to get this 700,000 and like factors that
departments consider in deciding what line items they're going to cut. you know, how do you you know, what factors because I, you know, I would like to, you know, I think probably the council would like to know if you come to us said, "We're going to cut $100,000 from the recck department and you're like, well, what what's
40 already has my bare bones cuts in it? I went through it last year." >> And I'm not suggesting that be done. I think it's just >> now it's >> understanding the factors that departments go through and deciding >> what we have to have and what we can get rid of. We're going to have to go back educate us on that would be probably
helpful. >> We have to go back to the drawing board with the department to find. >> Yeah. And if we and we make any decisions that are made, what is the implications, right? What do we what do we lose? It's not just a number. There's something that's happening with that reduction. The >> pros of one of the very hot topics right
now would be your vet tax look back. >> Yeah. Yeah. And again, not that I feel I feel bad about this, but again, there's only two towns in the state that are doing this two-year look back. I would rather see right now that it we go
we go from this point forward when it comes into here and it's approved by our tax assessor like everybody else is doing. >> Yeah. >> I mean, I don't know if we should I don't want to single out the vote because the council made a decision on that. I can't I know but you got to look
at try to find the 750 somewhere suspended. We can look at that but it's everything else and the council made a decision and I know the state is looking at some type of >> the state hasn't done anything. >> Well, we we need to but there's there's a bill pending to try to get that through
a while too. >> Well, then we need to call our our our representatives down there to push it forward, right? >> Yeah. But that's not going to help me. >> Okay. We need to take a recess. Um, do I have a second? >> Second. >> Okay. All in favor say I. >> I. I. >> All right. Let's do 10-minute recess. We'll be back
at uh 11. Okay, welcome back everyone. Uh, can I have a motion to go back into the public session, please? >> So moved. >> A second. >> Second. All in favor? >> I >> I Okay, we're back into our budget workshop session. Everyone, >> welcome back.
All right, so we have a little less than an hour left if we need it. Um, so let's want to figure out what else we need to cover today. We'll have a a opportunity for the public to ask questions and to um share some comments. Uh, and then
we'll figure out what next steps are. Okay. So, who would like to go first? Is there any uh so let me ask our our professionals um Don and Mike, anything right now that you'd want to jump in with and add at this point? Um, or do you want to
We can uh we can go down to deis as well. >> I have really nothing else to add but we will be going back and reviewing where with the department heads and where we can cut um
and that's about it. So I you know there's we've discussed mostly the process where we're at with the caps but um what we can do with the state as I grab uh deputy mayor I said that uh the past
two years we had self-exam so in other words that means we prepared the budget we can hand it to the state and say see you later. This year we have to submit our budget and they're going to review it. They're going to see what has happened the past two years and and ask
us a myriad of questions um that are going to I have no idea what they're going to ask, but we have to uh validate where we're at and how we got there. So, >> why is that? >> They used to do they used to do it every year, but
>> it got too large and they cut their staff. So, it's every three years. >> Okay. >> Oh, okay. >> Okay. Where does that happen in the process? asking with the timeline of >> as soon as we introduce it goes down to the state and we can't adopt till they say okay or they'll maybe have us adjust
our budget also. So you never know. >> Okay. So it's between introduction and adoption. Okay. >> Okay. And Mike, can Don, can I ask you the um the taxes I see on here on the last page
from 200 from 2016 is when assess um >> the reeval re-evaluation year was 2016. >> Well, the county tells us when we do that. >> The county does. >> Yes. >> Okay. >> That's not our chief. What we were
>> the ratable analysis. >> Yeah. >> What we were taught in class is that once you hit 75% of your uh value, >> that's when you have to technically uh rebal, but the county uh pushes that out. So,
>> are we allowed to unil unilaterally reassess? >> You can if you want to, but it's quite expensive. >> It is, isn't it? >> Yes. And that's why they have you let you use a three-year payment back. three or five year payment back. It's been a while since I did it. >> Five year. Okay. Thank you.
>> Because we the the tax is based upon the assessed value. Is that right? >> Yes. >> Yes. >> It's not it's not based on the fair market value. Is that correct? >> Currently, no. Once you do assess >> a sufficient delta or gap between a home's assessed value and its fair
market value. Is that right? >> Yes. Again, the 75% is when you technically you have to reval. Meaning if the assessed value is 75% of the fair market value or >> Yes. Okay. Which Yeah. Because once you revalid technically that should be at a
fair market value. >> Right. Right. Right. >> I mean it does there is a fluctuation but it should be there. >> Is that one way that a town can increase its revenue is to do a reassessment. Why is that? >> All you're doing is adjusting the tax base. A third goes up, a third goes down, a third stays the same. So you're
it's still you still got the same tax levy, so to speak. In other words, the what I commented before uh $112 million you collect, it's going to still be that $112 million, but now the pie, your pie, your pie, your pie, your pie, piece of
the pie, everybody's pie is going to be different based upon what happened in your neighborhood, your market value. So, >> but if the assessed value, so for example, you know, I mean, we can all go on, we get from the township our assessed value of our property, right?
Yes. >> Then we go on Zillow and we like, "Wow, my house is worth a lot more than the assessed value, right? And if the town were to say, you know what, we're going to reassess." And so if you were, your assessed value is 300,000. Now we're
going to assess you at 400. Wouldn't that increase the amount of tax revenue we would generate? Because now we're taxing off of 400,000 as opposed to 300,000. >> No. >> The rate changes. >> It adjusts your pie. Everybody here has got a slice of pizza. Sorry. You got the narrow one. You got a big piece.
>> Mhm. >> What's going to happen is I still have to collect $112 million. That doesn't change. Now you're paying less. You're going to pay more because your pie got bigger. Your piece of slice got bigger. That's all that does. >> Well, that's assumes that there's not
you're assuming that there would be differentiation among the homes. >> Well, they don't go down. >> I just said a third go up, third go down, third the same. >> Yeah. But what if all of them went up? >> Pardon? >> What if all every every >> then everybody's rate would go down.
>> Yeah. >> So the the factor that you're applying against in your example to 300 to 400, the factor you apply to the 400 is now a smaller multiplier. So you're still getting the same or similar dollar amount from that household. It's just that you're, you know, 0.1 times 400
versus like 0.15. >> So you're required to lower the millage rate based upon an increase in value. >> What if their value goes down? You're saying I mean I what I'm trying to understand is >> that's the way it works. >> If you have larger if you increase
residential values, right, theoretically and the rate stays the same, >> the rate doesn't stay the same. >> Okay, that's that's the key point. Why cannot the why can you not change the rate on top of changing the um assessed value of the property? Okay.
>> Because >> 112 million, that's what we got to collect. >> I don't care if your house is worth three million or 100,000. I still have to collect that. And that's the whole big pie. That's all you're changing is
what comes out of that pie is 112 million. How you break it up is the individual houses. >> You're capping at 112. I'm saying going forward like listen we are in the reality of it is health care costs are not going anywhere but up. >> Yeah. No
>> you're you're it's everybody's house I should say property is valuated to as a piece of the pie to pay off that 112 million. >> So that's a fixed line. That's a fixed number. >> Yes. It changes the calculation for each
individual home or property, but it doesn't change that 112 we got to collect. >> And to make it simple, the reason for that is because of the cap, right? Correct. >> That's correct. So this year we're
collecting $112 million worth of tax. So no matter if we have a a billion square foot office building that comes to town, we can't collect more than 114 something next year. Correct. >> False.
>> Okay. Tell me why. What did you just do to that pie by adding that building? >> Yes. >> You made it bigger. >> You made you made it bigger. But that first year, you're responsible for the
tax rate that he's been paying, he's been, she's been paying, he's been paying, he's been paying for that valuation. Okay? Now, because of that, say our taxes don't go up, budgets the same. We're still in the
next year, we're still looking for 112 million. But now because you added so much property value, everybody's peace now pays less because of what you made up. And that's where I was talking about
>> with North Village. What should have happened >> is the tax rate shouldn't have changed and you pay what everybody else pays. Now you have a bigger piece of the you have a more collection and more revenue. So what happened in
North Village? >> Your tax their tax rates went down because you came in. Thank you. >> So the tax rate should have been sta steady at at worst. Not gone down. >> Not gone down. >> Right. Right. As long you're going to pay for it in the long term, which
>> you had a windfall. >> Yeah. >> You >> and lost. >> Played with it. >> Played with it. >> So you had a windfall. You had a windfall of hookup fees and all kinds of all kinds. >> That's separate. All kinds. Okay. Well, let's include those, right? >> Because that's a utility. That's >> Well, because this goes to something
that was said at the planning board meeting just the other day. It was saying that, wow, let's get going and let's get some of these hookup fees to come in. Let's bring in more apartments and then we can have all these hookup fees. We need >> Huh. >> That would that would have a hookup is
$16,000. Correct. Yep. >> Right. And if one kid, one child moves in, that's going to cost us $300,000 over the next 13 years to educate that child. So here we can make 16,000 today
and pay $300,000 over the next 10 13 years. How does that make sense? >> How does that make sense? It makes the budget look great this year. We got $13,000, but next year we're paying $22,000
to educate that child. >> But that's the schoolboard rate. Okay. That's that's their that's their >> right. But but it still goes into the bucket of taxes that everybody pays. Correct. Right. >> Yes. >> Now, it's great because the $18,000 came
to us us the municipality, but the the school board is paying, right? That's one way to look at it. But the whole thing is that the taxpayer is paying more. >> Assuming it, Mark, I don't know if those numbers are I don't know where you pull
those numbers. And >> I just I mean I I don't know. I I I don't know if you're trying to stay right here on the on that side of it. I I see what you're saying. You do X and you're going to impact Y. I I just don't know if I I'm not going to debate you or
question. >> No, but I I provided you with those numbers. I provided you with those spreadsheets. I provided you with all the PDFs that I've drawn up about this and you know it's time for us to start looking at that. Right? Bringing in
>> new apartments doesn't help you. >> It's revenue. >> It's revenue. And what about the cost? What about It's great revenue, but what about the cost run? >> What about the cost? It costs $21,800
approximately to educate a child in Sparta. So then we don't want to build houses in the town because we don't want to we don't want the school taxes to go up is basically what you're saying. >> That's what I'm saying. Yeah. I'm saying that if the population doesn't grow, the population doesn't grow. You don't need
more schools. Your education cost doesn't go up. You don't have to buy another hundred million school like we had on the referendum like last year. >> So important important conversation. I just want to steer us a little bit more focused to the the budget at hand. But we do need to think long term always, right? I mean, it's a good point. We
need to think about from a governing body and what the the town wants in our master plan. It's important conversation, but I think for today, let's steer back to this because that won't help us right now solve this. >> I'll write it up and send it to the paper that'll explain it. >> The the other thing you have to look at
too is at some point in time those individuals aren't paying for a child. >> Yeah. >> Their child is is out of school. Is that >> 13 years after we paid $300,000 to educate them? You're still paying taxes.
>> Even though they don't have children, they're still paying school taxes. >> That's true. Not tax. No. Yeah. And that apartment, every apartment is paying like $6,000 in tax. And you got >> an apartment, whether there's a child in there or not, is still going to pay school tax. >> That's right. But what if there's 8/10
of a child in that apartment? >> But there's folks bringing focus. >> That's a classic discussion. I think we need to get back. We need to stay let's stay here focused. I just want to make sure we have time. >> I'll send it to the paper. >> Get through all of our comments >> and then give the public a chance and wrap
>> put in the paper. >> I think we explanation. How do we get we cut? >> I think that was the issue. >> Yeah. Which is >> So >> what do you what do you recommend? I mean, I know you have to meet back with the department heads and figure out, but I think what what are you looking at
when factors do you consider when a department says, you know, we can cut this or we can't cut this? Like what's the the non-negotiables? >> What do you consider? >> That's uh between between us and the manager and the department head. So,
we're we're going to be a uh excuse the expression, a three-headed snake or what was the uh from the three-headed dog. That's what we're going to be dealing with the department heads to find out what is available and be pretty much this time we have to be pretty much
hardline about it. So, >> there there's a limited area. we can cut there. And then I just ask that you look at things that maybe you can help out with or I'm looking more at like some of these celebration of events that are out
there. Yes. Everybody likes SPART. It'll look great and wonderful and and uh that there can microphone >> and that we're not in any kind of a situation right now, but the truth is we are okay. So maybe we don't give the
historical society $7,500 this year. Maybe that can be put on hold for one year. Maybe they can help out us as well. We're cutting everything here that we can. And these employees work. They're I I can't even tell you how hard
these employees work. As it stands right now, every non-union employee here is probably looking at no raise this year. That's going to be something that's cut. All the contractuals will still get theirs, but your entire second floor, you're saying nothing for you after they
just got hit with a 20% increase in their health insurance costs. If we're going to take so much of a brunt here, I'm asking you to look at what you think you can help out with as well and make this a a joint effort. You go through
this and you say, "Yes, don't give them $7,500. Give them $2,500 this year." the community gardens. Maybe give them something less, but don't do that and then don't come to me later on and say, "I need $3,000 for this committee or I
need something for that." You're looking at what we are right now and where we stand. Would we be in this boat if health insurance didn't go up? No, we wouldn't be in this boat. If we had bigger fund balance, would we be in this boat? No, we wouldn't be in this boat right now. But we're in the boat.
However the boat got launched doesn't make a difference to me. their numbers. We're here. We need to fix this. We need to get through next year. >> Don, I agree. I agree with you. Can you can you help us help you? Uh, not to be quoting a funny movie, but can you can
we just need the tools to do that? So, not today, but so like a listing of all the I I I saw this one that you gave me just in person a few days ago and I went through it very carefully. I sent a bunch of questions. >> You were reading the wrong line. Yeah, I was looking at the charged amount, not the budget, but but something like that
so we all can digest it and like your examples are great. Like 7500 there, 15,000 there, 5,ou they all add up, right? and some but we need to if you can't help us with the tools so we can visibly >> I see how like for example if you're going to look to us to to start cutting
services that uh residents have relied upon and enjoyed it would be helpful to know how much of that have we actually expended because I don't want to nibble around the edges right like if we nibble around the edges and we say oh we cut $5,000 and guess what you don't have a
summer concert series this year and it's $5,000 I think that $5,000 cut is not worth it. It's too small and it it entirely it does it gets rid of >> every little bit helps. And on the plus side, I'd rather cut a summer concert series than tell somebody that I have to
let them go. >> Well, I I think that's, >> you know, that's, you know, with all due respect, I think that's a false equivalency because what you're saying is we could have no summer concerts and you're saving five grand, >> right? And I think >> all those little five grands all add up
is what I'm saying. >> Yeah. Well, I think it's it's going to be helpful though to you to tell us where are you know, you know, a little bit here, a little bit there adds up. So, what's the total amount? If the total amount that we're providing for these kind of services only is about
$50,000, then that's not where we need to take, you know, get the bigger hits where we can. >> I don't have any bigger hits. That's the problem. And your O and E, I can show you what I have. We are running so close to it that I don't think we have enough
in O and E to cut to make up your 750. You are already at the bare bones. We are at the bare bones. >> I think if I could echo what Councilman Clark said. So it's it we might need some bigger decisions here, right? So it maybe it's combination of fives and tens
and 15s. Also, we need a 200 or we need a 100 or we need something. And maybe it's it's thinking about things that are very uncomfortable, right? I'll make this up out of thin air. um landscaping costs or or field maintenance, right? We want to have the best fields. We want to have the best flowers. We want town hall to look beautiful. We want all these
things. Okay. Well, tough decisions might need to be made about some things like that, right? Parks, not making no picking on parks and just for example, there's things with the streets. Maybe the example funny one before about the striping expensive, but so those are the things we have to think through like where if we need to make these types of
hard decisions, can we make them without the most damage, right? We're going to go down the dice. >> Yeah, let's let's do that. Um, one quick question before we go down the DAS one last time. Uh, just so I understand the
surplus, if I'm reading this correctly, that we have right now is 4 and a.5 million, 4.5 million, correct? Okay. Yeah. Okay. Just want to make sure that's we're entering the year because I know that's a simple question that people wonder about. >> Yes. And we're using that to offset the budget, too. Yeah, but it's entering
near we're up 4.5 million um only because I know there was a narratives going on in the past people didn't have full facts and they were saying it was in the tens of thousands and there was worries. So I just want to make sure that just so we're all clear right now we have four and a half million in surplus. It's critical we we could use more and we're critical that we were
going to use part of that. Okay. Um all right council let's go down to deis just any last comments or questions for now then we'll go to the public and then we'll think about next steps. Uh, Councilman Clark, anything else right now? Uh I did have a question about um
on the first page under uh it's uh footnote number three which is talking about uh North Village and there was and and my question will be why is it that the added assessment
revenue shows a spike in 2020 but then gets all the way down to now we're in 2025 where the added assessment value for North Village is only 38,000. Could you do explain that? >> So look at it's uh first page number three.
>> The surplus surplus sheet. >> Yeah, the surplus sheet >> under nine, >> right? >> Yeah. >> That's the uh surplus number nine. Reserve uh number three
under number nine. Oh, there it is. The added assessment revenue. Is that what you're >> questioning? Mhm. Why does it keep going down? >> You want to answer that? >> Nope. I'm going to leave it to you. >> Okay. You got no new building?
>> Yeah. >> Nothing's happening. >> Nothing's coming in. >> Thank you. No. Well, well, I'm saying so for North Village when it came in added an assess an increase in assessed value. >> Does that increase in assessed value
continue beyond the year that it first comes on the books? >> Yes. >> So, it stays and it increases. >> Yes. >> Okay. >> So, this is showing the incremental new that year, not including North Village, right? It's just that
year. That was your additional assessed value happening that year. >> It's a one time number that shows up on here, right? Because next year it's not >> incremental. It's ready. >> It's what happens each year. Okay. >> So that's so you had >> 2019
>> you had additional revenue of 1.2 million. The next year you had 567,000 and then it starts to tail off 285 242 146 and then uh this past year which is
not on here this uh the sheet it's 46,000. >> This is just new >> new that's that's new taxes coming in >> commercial and residential all all classes. >> If you look on our cap calculation page it says new construction. All we got to
put on this year was 45,5. >> So Mike, during those golden years, how much revenue did North Village bring us >> right there on a sheet? >> Those three numbers, right? >> Actually, more than that because you collected the school portion, too. >> 2.5, 2.3, and 2.2.
>> Yeah, that that >> that's what the revenue was for the entire town. >> No, the entire that was our portion. you had a portion that had to go uh that is not on this page that had to be paid to the county and open space. The only
portion that didn't go anywhere except to us was the school portion of that added assessment during that year. >> Right. Because then because every quarter, every couple months I see on the bills list that we're paying we're paying the school out of our budget.
Correct. >> Correct. >> All right. So you just said, so you just said that you know maximum in 20 two 2.5 million maximum in 21 2.3 million. >> Not maximum that's true figures. >> Okay, those these are the true figures, right?
>> True figures of added assessment value tax rate. >> We were told that North Village was going to bring us 12 new children. Unfortunately, it's brought us 140 children and half of them are special needs which makes it cost double. Therefore, these children are costing us
three po these these these children 140 children are costing us $3.5 million a year to educate. And you're saying, "Wow, in three years we made about six or seven million, but now we're paying 3.5 every year for the next
infinite number of years. Correct. >> I don't know the school budget, sir. I can't comment on it." Well, we pay we pay approximately $21,800 to educate a child here in Sparta. >> That that's not what's happening here.
That that is our tax rate at the time of the new assessed value. That's >> this is the revenue that's covering the school. >> No, this is ours only. >> Yeah. So, well, I want to get us back. We only have a lot of time left. So, please let's stay on topic, everyone. >> Yeah. I still didn't understand because
All right. So, maybe I'll just ask it directly. Why did you refer the as the golden years north village increased evaluation on tax collection? That assumes that there's there was a golden year and now there's not a golden year. Could you explain why that?
>> Because you okay the best way I can describe it is look right above it uh two line uh three lines above it you have amount to be raised. We should have raised our tax base to be
collected the next year from 2020 to 2021 by a million2. We did not. >> I got you. >> That is purely the town's rate adjustment of the new assessed value. Not school, not county. That's our
portion. That's what should have increased the tax level at that point to make everybody still pay. Say it was uh 56 cents all across the board. >> Okay. What happened was instead of paying 56 cents across the board, you
paid 55.5 cents across the board. >> We ate it properly. You didn't use it properly. >> We ate up that buffer at that those dollars buffer. And then >> we had inflation coin inflation >> was it was used during co to offset because people in town were losing their
jobs. >> So that that also came along. What is that? 3.1 million under 2025 >> for um created for by reserve on collected taxes. That seems like a pretty big >> No, no, that's that those numbers aren't
in yet. And and that's what I'm waiting for. The uh Yeah, >> ignore that. >> Okay. Okay. >> I was optimistic for a moment there. >> Thank you. >> When a new development comes in, you do get a is it a short-term increase, long-term or >> It's long term depending on how you use
it. it the the valuation is always there. Once it goes on the books, it's always there. It depends on how you tax it. You should tax it the same rate as the prior year, if not go up for the new budget. >> Yeah. But that also on the other side of the equation, I think, and this is what
Councilman Scott is driving at is that, you know, for every new development, there's also new costs, right? And and that's impossible to take into account at the time of the new development. >> Yes. >> Right. And so you have no way of knowing that at the time. It looks good, right? Hey, we're going to increase in
valuation of a million dollars, but the costs are are are lagging, right? You don't get the cost of that. And um I think another point I would want to make, I want to turn to the very last page, which is the ratable analysis. If
we could turn to that for a second. >> Ratable. >> Hold your sheet up. Why did you say it? Yeah, the you guys are off a different this >> Oh, that's I don't have that. That's from That's from Amanda. Yes, >> that's Amanda's. >> Okay. >> Oh, >> yeah. >> And so the ratable analysis at the
bottom uh where it has 2016 and 2026 and there's percentages or do you do not have this piece of paper? >> No, I don't have it in front of me. >> Oh, why don't you give it if someone can give them a copy? Thank >> Are we going to be publishing this
information to the public and putting this on online after this meeting? >> When it's settled? Yes, absolutely. >> When it's settled or or or what we've been working off of today? >> No. When we have actual figures, this is >> I'm just asking. Okay. Do you have the document in front of you? >> Yeah.
>> Okay. Um and you see at the bottom it has percentage of total. >> Mhm. >> By percentage of total that's um what is that attempting to show? the percentage of type of property as it contributes to
uh yes the revenue. >> Yeah. Yes. Whether Yes, they all contribute the same uh tax rate but the based upon the valuation she has it broken down per >> what is vacant property, what is residential, what is farm, commercial.
So >> it it should add up to 100% which I'm guaranteed it does. >> Okay. So whether you in 2016 or 2026 if the tax rate overall was two uh 3 point $3.60
it you're collecting the same amount. >> I got and the source of you know is one way to phrase it our source of the revenue. So for example vacant properties the source they're 1.9% of our total is that right >> in 2016 one of the quarter now. Yeah.
One I'll do 2026. >> Pay the same tax rate. >> Yeah. I'm not I'm not concerned about what I'm trying to get at is the largest source of our revenue >> is res is residential. Is that right? >> Yes. >> 86 85.81%.
Correct. Mhm. >> And then if you were to consider, let's, you know, for purpose of my question, commercial, industrial, and apartment, if you add that up together, that's probably what, like about 11%. >> Somewhere around there. Yeah.
>> Okay. So, the largest source of our revenue is through residential. And again, as we kind of got into earlier, am I right that the way we assess the residential properties that will determine how much revenue we will get from that property. Is that right?
>> I'm sorry, what was that again? >> For a residential property, the means by which we obtain information, obtain revenue from that residential property is based upon the assessed value of that property. Okay? And so theoretically if
the assessed value goes down, we keep the tax rate the same that revenue from that residential property will be less. Is that right? >> Yes. >> Okay. So do you do you think the township has an interest in preserving the residential property values in its
town? >> I would say yes in any town. But when you rev reevaluate everybody is going to be assessed hopefully at their correct value that they are paying with their fair value on the fair
value of their home. So it whether yours goes up or down the overall picture still has to be collected. >> Yeah. But if you have, you know, I I think um if you have what I'm trying to get at is that there sometimes there is
a tension between development and the property values of the township. There is relationship there. >> Either or. It doesn't matter. So there's a a business evaluation for business
properties and there's a residential. There's always there's a calculation. You have to ask Amanda, but >> they all still are the same. Once it's valued, it's still the same $3.60 based upon your value per 100,000.
>> Yeah, but we have no way of So, for example, I think what I'm trying to get is there should be analysis before I want to this idea that you can develop your way out of a budget issue, right? Hey, if we just increase more commercial,
somehow our budget problems will be solved. Well, it seems belied by that the largest source of our revenue is residential. >> It doesn't matter. >> It doesn't matter. >> Doesn't matter. That question you asked prior, the added assessment revenue
on the the other sheet, >> that's all based upon new ratables, whether it's residential or business, >> whatever. doesn't matter. >> And that's the is that's the last column net valuation. Correct. >> That's the overall valuation in the town. Yes. >> Right. So the the overall valuation of
the town since 2017 to 2026 has gone up 3.3%. >> So that's less than 3/10en of a percent per year. >> It went down from last year to this year too. >> So it went >> it's gone down since. So unless we want
to really really ramp it up and start paving over Sparta and making it look like Wayne and bring today. Let's focus on the budget. >> Let's stop with the politics. >> Yeah, let's stop with the politics, please. Focus on budget. You're talking about hypotheticals. I'm sitting here.
I'm trying to be patient. We're running out of time. I'd love to hear what the public has to say. And you're talking about 30,000 school kids per and throwing that nonsense out. Knock it. Come on. >> Yeah. Why throw out Why throw out facts? Mike, >> why throw out factual information?
>> Years 86% 86%. >> Council Clark put a good point on the table and you just took it down a political rabbit hole for no reason. He was trying to get an understanding if if that adjust or or 85% that gets
reassessed that cannot help fill a budget gap. And Mike answered it. That's it. It's also a lot of places get information. Hold on, a lot of dollars from the state. >> We need to keep this focused. All right. Also, >> let's let's lower the temperature. Let's
keep this focused. All right. I know this is stressful. Okay. >> Not stressful. Let's just be factual. >> Yeah. Let's be Let's be factual. Let's stop politics. >> People over politics. Mark, knock it off. >> Let's just focus on what we're here for. Okay.
>> Okay. >> People over politics. >> Yeah. I I was just I was trying to just understand it because I you know I think that I I wanted to make sure that the truth my concern would be about >> you know and it's hard to do this right you can it's hard to have when you bring in a new development to figure out one
what effect would that have on property values there are certain developments that you can that bring in that do reduce property values. There's plenty of literature on it pretending how how close they are. And so if you have a demunition in the property value of people's homes that drops down
eventually when you do reassess the assessed value thereby dropping down the amount of revenue derived from that house. And so you may have gotten a development on this side that brought you another million dollars. But if you have property values whereby the
demunition is larger than the increase that you got from the development, you really aren't any better. >> That's something beyond this table. >> Yes. >> Okay. That's yeah, that's more a policy thing, but I just wanted to kind of put that out there that I wanted the public to know that the largest source of this
town's revenue is through our homes. And so, we have to be very careful about keeping our property values high. And, you know, look, I'm one that says maybe we should reassess at some point, you know. >> Yeah. And it's not your choice. The >> county.
>> Yeah. Okay. But that's all I have. I'll I know we're getting late. I apologize. Okay, let's let's try to stay razor sharp here, folks. Okay, Margie, any >> uh questions or comments? >> I know those were those were answered. I just know like for school taxes, which automatically comes out of the top, but
we have always gotten passed by. >> We collect for them. We're paying out of ours. >> I know that. I That's not what I'm talking about. I'm talking about from the state. >> From the state. We've not gotten we've been overlooked continually and not gotten our sh fair share of of taxes for
schools from the state. Newark pays they pay 17% of theirs goes Right. Right. But we pay would you say 64% out of our taxes goes to the schools. >> Yes. Correct. >> Any any any money that came in from the state for the schools would affect the
school budget. Right. Correct. These not this number here with us. >> But it would take down our 64%. on the news Thursday night, uh Jefferson was on that they're cutting all sports programs, >> right? >> I was with him two weeks ago and they Yes, they're in the hole tremendously.
>> So what they do >> and they have to >> Okay, that's it. >> Okay. Uh two comments for now. One is just reiterating uh when you can if you can give us the details and the tools. Some of us might want to I know some of us dig really into details and see if we
can pop up other questions and comments uh as we move forward. The second one is just a comment on the professional and legal fees um professional services. I'm saying that in on purpose that way because there are professional fees and that includes legal fees, right? And
legal fees there's the retainer ones, the standard ones of doing business, right? And then there's the litigation related ones. When you look at, just so you know, when you look at these and you see something that says professional services, legal fees, special services, that's all together. Doesn't necessarily
mean it's all legal fees. There's a line in it. That pays for all our licenses. It's a special service. Pays for our MSI. It pays for our SDL. Pays for all that kind of stuff. Just because the line has the word legal in it doesn't mean it's all for legal. I just want you
to know that before you start looking. >> Okay. The professional fees part is a big component too, right? And including engineering and all the other expertise we have. Okay. >> So those are Yeah. So those are two um so I I think two comments on that. One is we need to review and analyze again
taking another look at the professional fees um including the legal fees and all the other ones just with another fine tooth comb just to be careful see if we could reduce anywhere. Um and secondly with the litigation one comment that keeps I keep wanting to share is that
even they have gone up in the last number of years um just to keep in mind that in the vast majority of cases um Sparta Township is the defendant. Um so it's not that Sparta Township is the plaintiff and we're nearly Willy going out and and suing a bunch of different
entities and the the vast majority of these were defending ourselves. Again, not a great situation to be in, but we need to do it. Um, so we need to be careful and manage that. But just to just to clarify that a lot of these cases, it's not by choice. We're defending oursel for what's right and what's important to the residents. Um,
it is expensive though, so we need to figure out how to deal with that. But just that's my comments for now. Um, deputy mayor. Yes. >> For now. >> Yeah. Thank you. Um, I want to thank my colleagues up here for a spirited discussion. I really want to thank uh,
Manager Zap, Dawn, Mike for your hard work and and the hard work yet to come. I I truly mean that. I appreciate what you did here today. Uh I'm just going to put this out here and you know I came in here very open-minded, very um supportive in un making myself
understand what's in front of me as well as trying to make sure the public understands. Um, I came in here with a bullet list of items what I thought would be key elements to a budget and in our budget and I'm going to put it out there and for consideration as well from
the team that's working on this. Um, first uh we had an audit and I'd like to immediately see and incorporate all the recommendations from that audit. There was about eight or nine points in the audit. We don't need to go through them in this detail. you have the report, but I'd like to see that most of them were
administrative, but they did offer some suggestions on how to to u clean up and gave suggestions to fix that audit. So, incorporating that audit's important. Number two is no layoffs. I think in the spirit of what we're trying to do here, and it's really difficult, I don't think
it should be falling on the backs of the veterans bills or andor any layoffs, etc. Um it's got to be looked at a little bit more granular and then holistically as well. Um hiring freeze. Uh managers, you talked about that
replacement hires only until we could um reconcile and see where the budget lands. Um departments are continuing to try to reduce I appreciate everybody working in good faith efforts to reduce your expenses or trying to balance it
out. So I know that's being worked on. No discretionary spending. And you could define discretionary spending as you like, but you know what that means. No major capital expenseman uh expenditures, expenses, andor improvement projects. Put a freeze on
that. No selling of any and all town assets. That's not a fix. That's a band-aid. That's just a one-time hit. I don't want and I'm highly suggesting that that's not up for consideration. any increase in taxes much must much
must include a portion to reinvest in replenishing and rebuilding a surplus. So if we're going to go and raise taxes, uh I'd like to see a percentage or portion of that going to rebuild and um replenish a surplus, not just try to
zero it out for any particular one fiscal or calendar calendar year. freeze on any discretionary projects that are not 100% fully funded by grant funding. So if we're matching funds or we're trying to raise additional money or the
municipalities and that includes our municipal expenses and the like associated with it. So if if we're getting a project but we still have to spend XYZ in uh professional services andor legal fees I think that that should be uh tabled for now and
that's on the expense side which we spent the 99% of the discussion on. I still think moving forward looking to be creative, finding creative solutions. And some solutions I think that should be considered is, you know, to immediately reduce legal fees by mediation/settlement
of the number of lawsuits we currently have on hand. I think we should, you know, to Councilman Scott's earlier discussion, uh, look to refinance that structure, try to find some other financing vehicles that could help patch or support this budget.
um increase revenues by I think we should you know we haven't talked about revenues I know they the challenges are do they show up they fix this budget no but they repair it moving forward and we and we we can uh adjust that with revenues we had healthier revenues we
wouldn't be in this discussion so um filling current vacancies throughout the town we have over 40 empty vacancies and you know throughout town I think there has to be an effort to try to support and attract and bring some businesses and you know into that space.
>> Um and then additionally also look to support and attract new businesses into into this community. Um they spur that that spurs additional growth to our business our local businesses. People come in here, they employ people, they
spend money in Sparta, they support our local businesses. everybody. It's it's a beehive that thrives uh with a little bit of an economic effort to bring some of these uh businesses into our town and then identify any and all pertinent grants, funding sources that are available to us across the board.
Whatever federal, state, local, county, government funding, grant us funding assistance that we can get to help support and maybe bring some of those other projects back online. All for it. Um, I think, you know, to keep the values up in Sparta, I don't think we
should be looking to really cut services. The services are are a real gem here. I appreciate the the the police department, the fire department, the EMTs, the ambulance, and all the other volunteer organizations that
support this town and, you know, make and continue to uh maintain and hopefully grow the uh values of our current real estate. So, saying all that, I know we have a lot more work to do, but um I'll stay tuned and I'll support
I I'm interested to hear what the public has to say as well. Thank you. >> Thank you, Councilman Scott. Anything right now? Any comments, questions? >> I just want to say thank you very much for all the work you've done, Mike and Don and Jim, and all everybody else on
our on our team. Um, I think that there is some lowhanging fruit and you guys have identified a bit of it and I think that we have to make some hard decisions and see if we can make some cuts and get our budget in
balance. To Mayor Blamemedi's point, all of these lawsuits, we are the defendant. And much of this professional services cost, in fact, over 70
8% of it is for general services, right? That's that's the budget I see that we spend. Right. It's >> I spent we spent $250,000 on the diamond chip
litigation, $27,000 defending ourselves in awesome acres. The affordable housing and trying to reduce the number of affordable housing units we have to deliver. We spent $89,000
tax related, which I guess is uh >> tax appeals tax appeals $17,000. And then in general services, our general legal liab considering all the people that are getting paid and the engineers and the
planners and all these things were paying spending $762,000 a year. I >> I did suggest that we I did suggest that we start billing the developers directly for the time that our engineers and our
professionals and our lawyers are working on their cases even during meetings. If they take up one hour, those three professionals should be billing the developer. I think there are are are places we can
cut. I don't know if we have any duplicate positions in our in our town hall. Uh I think everybody here works extremely hard and I hope that we can come to a solution here and we make some some of the tough decisions that have to be made. Thank you.
>> Thank you. Okay. Uh let's move on to the public. Okay. Um so we're going to do a open to the public segment. It works typically like we're gonna we work a regular public meeting. So, um, please just share your name, um, and limit your comments to, uh, 5 minutes maximum. And
again, we're going to take that under consideration. Um, if you have a question, we'll let's not we probably won't answer it now because we're all working through this. Um, also not to use up your time, but we just want to make sure you have your your time to share your comments, recommendations, ideas, what have you. So, we'll u start
with that and then we'll wrap up afterwards. Okay. Uh, anyone from the public would like to share any comments? >> Hi everybody. Uh, Ron Day as part of township. Um, let me just first start off by saying thank everybody here today
on behalf of the township and the town council. I I thought this was a good meeting. There was some good discussion. Not everyone was in agreement and that's a good thing. We're having the having the debates, but uh was obvious a lot of work going into this. So, thank everybody for for doing that. Um, I'm
going to just make this quick because I want to watch this clock. Um, one the the the one disappointment I had is we don't have as a members of the public something in front of us. I've been to a bunch of these workshops. This is the first time there wasn't either a presentation or a handout. So, it's and
it's hard to follow discussion. So, if you can put something online, consider putting something online, market draft. We know it's not the final version, but give us something to look at. Maybe maybe we can come up with some ideas. Um some of the takeaways from from today um I I think deferring capital improvement
that that's a big deal and that's a big compromise. Um so I I I appreciate that. That should help. I'm sure that wasn't an easy decision. Uh surprise 4.5 million in surplus. Um that's great news. Um hope that and that's all available to us for use this year it
sounds like and then this year we'll use that and then so we'll have the discussion about next year next year. So um but that that was a nice surprise. Um to me to me the the the big part of the discussion is really about revenues and I think you've all kind of hit on this today. Um you know costs are going to
continue to to grow and we're going to cover it this year and they're going to grow next year. The only way we're ever going to win the battle is with new revenues. New revenues so people understand it's not someone going into a building that exists. It's a new
building going up because the building whether it's empty or full. They're still paying taxes. the the building owner. So we need to get new building new buildings that conform with our codes and you know don't you know all within you know what we want to see here
in Sparta. So we got to focus on that. It sounds like we are um one suggestion in terms of um surplus is maybe look at um next year from the expense side um any underruns that we have this year
rather than to move them to other accounts let's try to commit to put those towards reserves of next year. So, so if we have young insurance, let's capitalize it. Let's use that for for for growth. Uh staffing cutbacks, you know, is the last option that that's good. Um I I think, you know, we using
attrition as people leave, they don't get replaced. That's that's a good compromise. Um one thing you may want to consider um I haven't heard anyone mention is is can you offer early retirement package? Can you incentivize anybody to leave early? maybe help get that headcat down, help get that will
help uh medical and pensions and all that kind of stuff. Um when it come when it comes to to cutbacks, and I've said this before, I want to say it again, is is you know, we can't afford any types of cutbacks in our police or other emergency services. They do a good job.
We need to make sure that they're supported properly. I know it's hard to do, but that's still part of the discussion has to go on. I still think based on the information that was came out in the master plan, I I know it's tight, but we we we got to find ways to give them more if they need it.
Tough disc discussion, but more to come on that one. Um, health insurance. I thought Chief McCarrick came up with I what I thought was a great idea. Um, you know, employees here have the option to take health insurance or opt out. people
that I've talked to that have these in other places, I don't know about here, but usually the incentive to opt out isn't worth their while. So, would it be worthwhile to look at motivating them to opt out? Give them a bigger payout if you don't take it because maybe they may
they have a partner or spouse or something where they're already covered. And if and if we can incentivize them, they're getting more money and that should cut down on some of our health our health insurance costs. Um going forward um the last thing I
want to ask is that you know this again good meeting. I always feel me personally a little surprised when I come to come come to these meetings. I I kind kind of know what I think I'm going to hear. So I've asked it before. I'm going to ask it again. Is is that the council consider having quarterly
updates on our financial status as a township at some of the town council meetings. So, um, and that way we can kind of let's walk the let's get the issues as we go. So, so given that again, thank you everybody. I think it was a great
meeting. Um, and hopefully we'll, uh, not hopefully we will figure this out as a as a as a township. So, thank you all. >> Thank you. >> Thanks, Ron. >> Hi, Jenny Derek. Um, I apologize for coming late. I did hear Ron say that we assisted that we
collected 4.5 million for the surplus. Are we relying on that for this year's budget? >> How much of it? All of it. >> What are we looking at? How much are we using the fund balance this year to offer? >> Can you speak in the microphone?
>> Can you speak in the mic? >> Don 4.5 million. So that's the amount that was collected this year in the collection for unreserved t for uncollected taxes reserve for uncollected taxes. >> The structure for the debt I'm sorry for
the reserve for collected taxes was 3.15 >> and um some of the other revenues collected exceeded and hopefully pushed us to having the 4.5 available. I'm not sure
yet. That's what we're waiting for our audit to confirm. >> So go, pardon me, going by last year's um information, that leaves us with under a million in our in our place. Okay. >> Um regarding assessments, I just uh had
a meeting with the manager at Newton. They do rolling assessments there. Is that not something we would entertain here in Sparta where every year properties get reassessed? and he did not speak to the um requirement to be directed to assess but rather that this
is just something that they do proactively. Is that not something that we would entertain here in Sparta? >> We can answer that afterwards, Jenny, if you want after you finish. So, you want to take up your time? We talked about that earlier, I think, before you came. >> Sure. Um, the only other comment I have,
and this is one that I always talk to Jim about every meeting, is the closing of the landfill has the potential for bringing us an income of over $400,000 contractually. >> Okay, we have time left. Wait a minute. This is different.
Okay, so we did talk a little bit about the um both all great points, too. And thank you, Ron, as well. the rolling assessments. We did talk about it earlier that it's it's uh quite expensive in the year you're doing it. I think a couple years ago we had talked about doing rolling assessments and starting that up and table that for the time being. Um it is something we could
do although the conversation earlier led to the fact that if we still need to collect x number of tax dollars to and it's the maximum we can collect say it's 12 million 12 whatever. Um, by doing the assessments, you're just shifting around
who is paying a portion of that total tax. >> I understand all of that, but it doesn't hurt to know what your actual tax bill is, and then you can have a little more flexibility there. There was one other um item. Uh, do we have the >> consideration to do a leasing program
for our larger vehicles or our fleet vehicles rather than um purchasing them? >> Okay. Thank you. The landfill point, um I know we've been talking about that for a while and it's it eventually will be coming here. Is it too soon or is do we
have to be conservative and not include it in here? Right. Because we don't know when actually it's going to kick in. >> You have you have to have solidified numbers. >> Has to be solidified. Okay. Okay. >> If it comes in, it'll come in at assessed value at in October. So,
>> is that going to be renegotiated? >> Most likely. Again, in in my opinion, the the objective is to successfully close the landfill. We've been using uh C renewables, the the vendor who who's proposing the lease. They've been
providing the escrow to help us get the landfill closed. So, we close it. Then, depending on what the environment is on solar, yes, I believe uh we will end up renegotiating a lease. Uh it's just an arduous process. Uh we have located a
person at D who is now receiving the documentation on the parcels that we're proposing to donate. You will hear about that soon. We are getting closer. It is just an incredible uh arduous process. Uh but we're getting there. Again, the
objective is for the town to close the landfill. >> Uh we can look at what potential revenues can be generated afterwards. >> Okay. Okay. We can't count that now. Uh just the last I don't know if the answer this now but I guess to put on the list if it hasn't been considered is the idea
of leasing for larger vehicles. It might be something that obviously takes some advanced planning because we're not going to go out and just lease something now if we own something but just put it on the list for down the road. >> Mayor, I I have looked at that and we can give you elaborate. The thing is is it's cheaper for the town to basically
give itself its loan because of the rate it pays. We're not bonding right now. We're using cash. So when we purchase a large truck, um, we're able to buy it outright under our capital and and we're paying dimminimous amounts of money. Leases just aren't far. Usually leases
are to towns that don't have any money at all. We're actually in the opposite. We just talked about the the the excellent condition, you know, position we are for debt. >> So we can do that ourselves and we have replacement plans. My my criticism of replacement plans is when you have a
situation like this and you got to put it on hold, you just upset your replacement plan. So you don't have that. The rolling assessment, Jenny, we could look at that when the county says, "Hey, time to reassess." And you do the initial reassessment because of the cost
involved. And it it would be at that juncture that we say, "Hey, maybe we want to activate rolling assessments." I have uh been, you know, informed about rolling assessments and all. It's just uh because of the cost. It is an exceptional cost. We bring that up when
we, you know, the county tells us, hey, it's time to reassess. That's what we could do there. Um I bet if you talk to Tom Russo over there in Newton, he would tell you that they initiated it during the last assessment, which was 2016 for us. I don't know when the last one was
for Newton, but I bet it that's when it uh started. >> Okay. Anyone else from the public? Good afternoon everybody. Jeff McCair, chief of police. Um, as I am going to speak on behalf of my police department, I just want to make a point that
when you're looking at budget cuts and you're talking about employees, none of this happens, none of these daily operations happen without your employees. for instance, sitting here this morning how hot it was in this courtroom, sending a message to Gene Donnelly, who was our building grounds
guys. He comes down here, takes care of business, and gets the air flow going. So, our employees, they they pay a lot towards this town. Um, and you get a lot back. I'm going to talk about our police department because I know our police department is always looked at as a very
high budget area and I understand that. And I could ask you a question as to why you think that is. Um, but I'll give you a couple facts here. And the fact is we are the only department that operates 365 days a year, 247.
That equates to 341.53% more than the other departments. That equates to 8,760 hours per year that your police department is working for all of you and for our community. In 2025,
we put in 90,815 man-h hours. It's a lot of man-h hours. When I took my numbers from MSI with our finance and I broke it down, the total cost for a police department
per year or per hour, I'm sorry, is $592. This is not including our dispatch. The total cost for the police department per taxpaying property is $618 per year.
I think that's pretty impressive. When you add in dispatch, dispatch separately is a cost of $15 per hour and $19 per taxable property per year.
So when you add those two togethers, it costs $728 per taxable property per year. I think that's pretty good. Right now, we currently have 35 officers.
We have two officers that are retiring this year. We have two special officers that are that are that are officers that handle court. They handle the meetings, um, which is is a is a part-time cost. In 1969 they had 20 officers in this
town. In 1970 they had 22 officers at that time. In 1969 they handled a total of 2566 incidents. Last year in 2025
with 35 officers we handled over 39,000 incidents. There was no North Village back then. There was no North Village, I want to say around 10 years ago. I'm just making some points out there because we are the highest budgeted
department in the town and we know that. We take pride in that. Our officers take pride in that and that's why we're consistently one of the top safest communities in the state and in the nation. is from the work that our men and women do down there every single day. Our sworn employees
and our nonsworn employees. So when you look at a couple different things, we will work with the town. Our operating cost isn't that much. Our operating cost has been $225,000 for the past three years.
Our office works on grants. We seek them out. We take advantage of them. And I'm going to give you a few of the grants that we have worked on the past few years. Body warn camera grants. Over $38,000 a
year we've gotten back, which is a body warn camera is is something that we have to have. It creates trust in the public to see us on camera. It creates uh you know our our training purposes for our officers
and for us to go back and say, "Hey, this is an incident that happened. How could we do better?" And I could go on and on about that. We had grants that we worked with our dispatch center in 2024.
We utilize $1.1 million in grants between the ARP grant, the Josh Gothheimr Community Funding Grant, um, and a couple other different grants there, but to build our back hall network with our infrastructure of our
radio system, which benefited not only police department, but the fire department, EMS, and DPW. So, these are things that our department has had, our township has had, and we are able to seek out grant money for
them. We're going to continue to do that. My point is to you is that I know that we cost a lot of money, but not only as a chief of police here, but as a resident who grew up born and raised in
this town, I'm very proud of those costs. I'm proud of what we do. I'm proud to provide the service that we do and we're going to continue to do it. So when we look at cuts, we can't go down in manpower anymore.
It's it's not going to work. We got to keep this sound town safe. We got to keep this town moving and we'll do it. But when we look at it, I'm asking you to take consideration into that part of our manpower. I thank you for your time.
I thank you for what you do. It's not easy. our finance department. It's not easy on them. Um I don't I don't want to be in their shoes, but um we're here for them. Whatever we could do, too. Uh thank you all. >> Thank you. >> Thank you.
>> Okay. Anyone else from the public? Okay, seeing none, let's bring it back to the deis. Um so before we wrap up, let's just talk about uh some next steps and timelines. Um, any proposals, town
manager or finance team? I mean, I'm assuming the council will need to regroup again. It just seems like we just need some more details and we need to make some choices at some point, right? Um, so we have to figure out when that would be.
>> So, as I was saying before there, mayor, um, there's a couple things that have to happen. One is it's integral that we're waiting for the annual financial statement to be issued to us. That'll really finalize uh some stuff. Uh the finance team and I are going to go over
one more time line by line all the departments to see what we can trim uh and see what the balance is. Um I'm I'm glad that that the council is aware now of the challenges we have. So then when we present them to you, uh I have a
feeling I'll be coming to you and telling you that we couldn't find 700,000 and we could find so much more and this is the number that we're at. You know, we we'll be asking for the council now to help on some of those project, you know, some of those items
to get down there. Um we may have no choice but to address a staff issue. Um, you know, we're putting it all out there, but we're going to do our our damnedest, all of us, >> you included, to uh try and uh find everything we can on this. And it is a
it's a dynamic situation. It's it's constantly evolving. Things are changing. Things change all the time. Um, you know, I'm glad the public and the council is aware of of the efforts we're all making uh uh to to get there. It it it is a very very uncomfortable position
to be in. Um, but knowledge is power. You guys are getting it all and and we're also going to try and and you know figure out what we got to do to avoid being in this position again. So, um, with that again, I will be reporting to you. I'll try and get some handouts out,
get some detail that you folks can look at. Finance and I next week are going to be working on a lot of stuff. We're trying to get that financial statement. It is my desire to have a balanced budget or or some type of um um proposal
for the council to consider for the 24th meeting. Um it it you know I hate when this stuff goes into April and it prolongs out. In fact, I'll give the pitch that the next meeting, the 10th, uh Tuesday, um we have a resolution for estimated tax bills. Um, we're going to
be sending out estimated tax bills to just ensure cash flow so our departments and and and vendors, everyone still gets paid. Um, we didn't do that last year. So, we really are trying to manage the best we can our finance design and how
it rolls out. Um, doors always open. You guys uh access me all the time, even 11 o'clock at night, it's it's fine. Um we we we'll we'll continue on. So but that that's where I think we're at. >> Okay. And just to be clear with the
where we are with the gap, right? So I think going back to the first few moments of this meeting, your statement is that we have a gap to solve whether it's 750k or whatever the number is. There's a significant gap to solve. And
even when we solve that gap, potentially we're looking at a tax increase of perhaps that 9 to 10%. Is that correct? >> That's correct. And that is because >> mostly because of the health insurance and the state allowing us to put that
out of the cap and we can utilize tax increase. >> I just don't want to mislead anyone saying that if we find 750 or whatever the number is, $800,000 that taxes are going to be artificially low. Wait a minute. We're going to come in with some crazy low number. I just want to make sure that's clear to everyone. Right.
The gap we're trying to solve is to stick where the maximum can be, which is that nine or 10, >> right? It it basically gets us in compliant to the state's liking and within the the g the caps, >> the tax appropriations made that that's
the caveat. Like we said years ago, you used to be able to tax your way out of this. We just increase the taxes and and we'd be okay. State won't let us do this anymore. So you're really confined to to keeping it within the caps. And that gap
of 750 is what we need to stay within the caps. >> And with the health insurance going up almost 2 million, we've already found a way to solve for one and a quarter million of that, right? Because we're the gap is only 750, >> right? >> In theory, right?
>> We've already done a bunch of cuts with it. The capital improvement being zeroed out this year. um uh o overtime is being addressed uh across the board. Uh we we we we we are already implementing a bunch of measures. Um but unfortunately we have to do more.
>> Excuse me, Jim. When was the last time you had a group uh council workshop like this? >> What I I never had one just like this. We've had similar ones uh where they were dovetailed usually before a council meeting. Um, but this one was carved out
specifically just as a budget meeting. Um, >> I'll I'll nod that Ron. He he kind of poked us along on that >> last couple years. >> Years ago, they used to do them on Saturdays like this. They would meet in a Saturday morning and take care of it >> years ago. >> Yeah.
>> That's what I thought. Thank you for starting this again. >> When Bill was in when Bill Close was >> Yeah. >> He used to run him on a Saturday. But we did have every year we had a public we do have a public session every year to talk about usually have a budget if we didn't we didn't need to do any of these
or where we were now probably just go through with >> usually it's further along introd the introduction we wouldn't have needed to do this with you. >> Yeah. >> But typically we have talked about them and shared documents in advance because it's been further along with revenues and tax rates and everything. Right. Correct. Okay.
>> Okay. With that, uh, can I have a motion to adjurnn? >> I'll make a motion to adjurnn. >> Second. I'll second. >> All in favor? I >> I >> Okay, we are Thank you