Despite Projected $1.5M Shortfall, South Orange to Keep Budget Increase Below 3% — and Will Extend Property Tax Grace Period

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From South Orange Village President Sheena Collum:

The Municipal Budget will be Introduced Under 3 Percent

Less than two months ago, my colleagues and I were preparing to introduce a budget at roughly around 5–6 percent. This budget entailed a series of new services, filling vacancies in our organization and significant investments in our capital program that we had been planning for quite some time. After we completed an additional fiscal analysis two weeks ago- taking into account the devastating financial impacts of COVID-19 – we identified over $1.5 million in loss revenue and uncertainty about tax collections.

With a great sense of urgency, we have been working around the clock with a singular focus of minimizing financial impact on taxpayers while continuing to provide quality services. We have made across-the-board cuts to all aspects of our organization, removed significant funding from our capital improvement plan, leveraged more than one million dollars in our fund balance to bridge the gap, and are applying our one-time revenue from a redevelopment asset sale to deliver a responsible budget.

Additionally, we have requested all municipal employees forgo a 2 percent “raise” for the next two years to contribute in this shared sacrifice and to avoid any demotions, furloughs, or layoffs. The video of our Monday meeting is posted here; a more detailed discussion of our budget and findings can be viewed at 1:35:00.

Property Tax Payments

The South Orange Board of Trustees has been advocating that the state permit local units to provide flexibility to taxpayers during this difficult time. Mayor Frank McGehee and I sent the attached letter to Governor Murphy last week and are appreciative that he has now issued Executive Order 130, which permits a governing body to adopt a resolution extending the grace period for the May 1 property tax payment. The grace period cannot go later than June 1, 2020. The Board of Trustees will be scheduling a special meeting to extend this courtesy to our residents.

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