Small towns could recoup state aid

Local municipalities with populations below 10,000 may see some of their state aid restored if a proposal made by Gov. Jon Corzine last week gains the support of the state Legislature.

On May 13, Corzine proposed revising the Consolidated Municipal Property Tax Relief Aid (CMPTRA) reductions originally proposed in the state's fiscal year 2009 budget.

Mayor Michael Halfacre, of Fair Haven, had a mixed reaction to his borough's restored $17,222, calling it "better than nothing."

Fair Haven's state aid was cut in half by the governor's proposed state aid reduction, with a decrease of $155,240 from previous years. The borough's proposed tax rate for 2008 went from a half-cent decrease to a 0.87-cent increase with the loss of aid.

With the proposed restoration, the borough's total aid would come to $79,222.

"Obviously we're happy to get back anything we can," Halfacre said on Monday. "Frankly $17,000 isn't going to do much for us."

Halfacre added that he doesn't think that the fight for more aid is over, and that senators and assemblymen have hinted that there is going to be more.

"It's nice that [Gov. Corzine] is throwing us a bone, but it's fundamentally unfair that we have to bear the brunt of the state's mismanagement," he said. "Why are we the ones who have to pay the price for all the funds that are poured into the big cities?"

However, Halfacre was optimistic that things appear to be moving in the right direction.

"I'm glad we're getting our $17,000 back, and I'm fairly certain that we're going to be getting more," he said.

Oceanport Councilman Joseph Irace was also of the opinion that state aid should be restored in full.

"It's a nice start, but I really think that we should get all of it back," Irace said Monday. "I'm hoping to try to get as much back as we possibly can. I can't see why they wouldn't give it to us in its entirety."

Small towns like Oceanport and Fair Haven run local governments with less than 10 percent of funds coming from state aid, while larger cities receive over 50 percent of their funding through the state, Irace said. He didn't see the logic in cutting from small municipalities in order to trim state spending.

"I think it's a myth that the small towns are a drain on society," Irace said. "It's a lot of money for a small town, but not for the state."

In Oceanport, where state aid was reduced by $175,376 increasing taxes by about $65 per household, $20,909 would be restored, leading to a total figure of $96,184 in aid for the borough.

"They're still talking about it, and I know our legislators are still fighting for it," Irace said. "It's a bipartisan issue and what's nice about it is you finally see everyone working together."

Irace added that Corzine's proposed cuts had heightened the borough's awareness of how easily the aid can be taken away.

"We can't count on this money being there forever, so we need to look at other things and outside the box to find as much savings as we can," Irace said.

The New Jersey Department of Community Affairs released the proposed municipal state aid figures on May 16. The posting is advisory in nature, as the final allocation rests with the state Legislature and final passage of the state's fiscal 2009 budget.

The proposal would ensure that no community faces an increase in the average residential property tax bill of more than $100 as a result of the CMPTRA reduction that was proposed for small communities with populations of fewer than 10,000.

For municipalities with a population of under 10,000, 25 percent of what the CMPTRA cut would have been is restored (excluding transfers to Energy Tax Receipts).

When the impact of the remaining aid reduction results in an increase of more than $100 on an average residential property, additional CMPTRA aid will be provided to limit the increase to $100.

"Gov. Corzine has presented a budget that will get New Jersey's finances back on the right track," said Commissioner Joseph V. Doria Jr. "The proposed restructuring of aid to towns encourages communities across the state to examine the benefits of municipal consolidation and shared services, but also recognizes the importance of state aid for our state's smallest communities."

The revised numbers are available on the department's Web site at www.state.nj.us/dca/lgs/muniaid/08_aid/0 8-09_cmptrarest.shtml.