March 4, 2009 THE VILLADOM TIMES I • Page 5 Midland Park More than 10 years of wise management has left the Borough of Midland Park well positioned to deal with the effects of the economic downturn, according to the borough’s auditor. “You are probably the only town of the ones I am aware of that doesn’t have cap and budgetary problems,” Auditor Fred Tomkins told the mayor and council last week. “You have run very conservatively, and it has served you well. Others have not done that, and now they are suffering,” he added. The governing body had asked Tomkins to attend its regular meeting to discuss concerns related to the budget surplus. As of the end of 2008, the unaudited surplus is estimated to be $3,219,374, but the council traditionally commits a large portion of it to the following year’s budget to offset tax increases. Tomkins said the state does not regulate the amount of surplus in municipal budgets, unlike school budgets, whose surplus is capped. Over the past 10 years, he said, the borough each year has been able to regenerate the moneys applied to the following year’s budget, a healthy practice, he noted. “There is no specific number for surplus; it’s not a per�� ����� ���������� Borough in strong position to withstand recession fect thing. You need flexibility in cash flow to avoid problems. If it is too tight, then you have to borrow, and that costs you money,” he told the mayor and council, adding: “The money from the state sometimes is slow to come because they have their own cash flow problems. Sometimes they even wait until the new fiscal year to forward the funds.” Surplus funds are accumulated from monies that come in throughout the year from fees and other sources that were not anticipated when the budget was adopted, from funds left over after all commitments from the previous year are met (lapsed funds), and from the borough’s PILOT agreement with the Kentshire apartment complex, among other sources. Tomkins said that the borough this year would likely not need to defer pension payments as is being done by the state and encouraged for cash-strapped municipalities. “It does not make sense, but other towns have no other choice because otherwise they would be pushed into a deficit situation. It will affect their tax the following year,” he said. Borough Administrator Michelle Dugan noted that payments to the school board, the county and the sewer ���� ������� ������������ authority must be made on time regardless of the borough’s reserve funds. She said that since the first two quarters of taxes are estimated amounts, the bulk of the taxes are collected in the last two quarters. “We are collecting the majority in the last half of the year, and the same is the case with state aid. The first two quarters are tough,” she said. Dugan also said that as the borough’s percentage of revenues from state sources decreases, and consequently the reliance on local revenue sources increases, surplus becomes even more important in balancing the budget, particularly because the budget caps limit the options available. The governing body has been working on the 2009 budget since November, and has discussed options to deal with any reductions in state aid. “We have identified risk factors in the budget. We have a good game plan, and we are in a good position to deal with any problems,” Mayor Joseph Monahan said. “We won’t know until the state aid figures come in.” Dugan said the state aid notification is expected to be received in mid-March, after which the budget will be introduced. ��������������������� ������������������������������������� Dr. Heather Sculthorpe is proud to present Tracy Collins, a 2006 winner of the Hygienist of the Year from RDH Magazine. 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