Auditor's findings triple possible tax increase

An audit of the proposed $61 million budget has changed the outlook from a predicted 2.1 percent increase in taxes for the 2006 fiscal year to 7.34 percent.

The largest item in a $1.9 million shortfall is ironically due to a success story - the city has increased its tax collection rate to the point where it can no longer rely on a high volume of recovered delinquent taxes as a revenue source. The city had projected receipts of $600,000 in tax lien sales, but because only $300,000 was realized last year, auditors disallowed the higher figure.

The city recently received news of higher state pension costs, requiring an additional $425,000 that drove the 2.1 percent projected tax increase to 2.7 percent.

In budget deliberations Tuesday (Aug. 16, 2005) the news spurred the City Council to look for cuts and to seek extraordinary state aid for tax relief.

The full council expects to meet with its auditing firm, Suplee Clooney & Co., next week to go over the numbers that a few council members heard this week.

The tax rate per $100 of assessed valuation could jump from $3.07 to $3.23, Finance Director Ron West said.

“I think this is a hard blow to us,” City Council President Linda Carter said. ”We are going to have to make some very tough decisions and we have to do it collectively.”

Councilman Cory Storch said, “We’re not going to tolerate a 7 percent tax increase,” and suggested that a three-member finance committee should go back and identify more cuts.

Carter said residents may have to go to Trenton to lobby for tax relief.

“If we have to take the whole city of Plainfield, we will do that,” she said.

Budget introduction is slated for Aug. 29, after which the council can officially modify the budget. But the city may have to wait until late fall to hear whether the state will give extraordinary aid and meanwhile can’t pass the budget.

--Bernice Paglia

KEYWORDS: budget