|ATLANTIC COUNTY EXECUTIVE 2012 BUDGET MESSAGE
presented: January 24, 2012
It is my pleasure to come before you to present the 2012 Atlantic County Executive Budget. As you are well aware, the economic situation in both New Jersey and Atlantic County remains challenging. Our unemployment rate is above 12%. Over the past year there has been a sizable reduction in the number of jobs in our largest industry, casino gaming, and the jobs that remain are increasingly lower paying with fewer benefits. Many others who have been laid off have also had to accept less desirable and financially remunerative employment.
The nationwide free fall in real estate values continues and many families now find they owe more than their home is worth. This trend has impacted many in Atlantic County and affected local property tax ratables and local government revenues. This is reflected in Atlantic County’s downward equalized value which fell by $2.1 billion in 2011. Since 2008, the county equalized value has decreased by $11 billion. The decrease from Atlantic City alone is $6 billion. Further decreases may be expected in the coming years.
The state of the local and national economy impacts our county budget in other ways. Atlantic County’s TANF enrollments are up by 17%, resulting in an additional $433,351 in our share of administrative costs. Our Health Benefit costs are up almost 5%, or $1 million. This cost should decrease over the next three years as employees assume a greater share of the cost of their premium as now required by state law. Workers Compensation costs are up by $606,113. Expenses we are required to pay by state mandate have also increased. The cost to maintain county patients in state mental institutions is up $1,537,907. While expenses have gone up, revenues have gone down.
Overall, our revenues are down by $625,555. More specifically, revenues from our County Clerk’s Office, which are based on real estate transactions, are down 12.73%, or $546,700. Since 2007 the Clerk’s revenues are down by $3.9 million as a result of the area’s struggling real estate market. County Sheriff revenues are down 27.14%, or $232,500. Most significantly, interest on investments is down 80.42%, over $400,000. As you know, government is limited where and how it can invest. Currently we average about .1 percent interest on our investments. In previous years the rate averaged between three and four percent.
Although the state and local economic situations remain weak, I am pleased to say that the fiscal policies we implemented during my tenure as County Executive have placed Atlantic County in good standing as we face the year ahead. Unlike some other jurisdictions, we do not face any major, fiscal challenges in the year ahead. We will not have furloughs or layoffs.
The 2012 County Budget that I present to you today is $194,091,546.75 an increase of only 1.76% from last year. The Amount to be Raised by Taxation is $152,745,743.75, approximately $4 million less than allowed by the state budget cap. Based on the best information we currently have available, we conservatively predict the County equalized Tax Rate will remain fairly stable, and at .322 cents is still much lower than the .4362 cents rate when I assumed office in 2000. This increase from 2011 is .014 cents. However, at the present time the county tax administrator believes that when all towns have filed their assessments, the equalized tax rate will be lower, .315 cents, and be an increase of only .007 cents.
Our 2012 Budget is a responsible spending plan that meets the needs of our citizens efficiently and effectively. Total operational expenses are up only point thirteen of a percent. As has been our ongoing practice, we utilized 50% of our year end surplus, $15,486,000, in the 2012 budget.
In all we are in a good financial position to meet the challenges and opportunities that will present themselves in the year ahead. Our twelve perfect annual audits, strong bond ratings and low debt, attest to the soundness of our fiscal policies and the quality and experience of our financial staff. It also attests to the bipartisan cooperation we receive from this Board of Freeholders. All of you help to make Atlantic County a better place and have my gratitude and appreciation. Thank you.