Fanwood CFO Fred Tomkins formally introduced the 2012-2013 municipal budget to the Fanwood Borough Council on Tuesday night. The new budget comes in well below the two percent cap. The proposed increase, which was unanimously approved at Tuesday’s meeting, is roughly one-third of 1 percent.

The average Fanwood resident will see an increase of $7.67 in municipal taxes. After county and school taxes are added in, the projected increase is $55 per household, although that number could change slightly depending on the Union County budget presentation. The Board of Education will present the 2012-2013 meeting on Thursday.

“A $7 increase doesn’t happen by accident,” Council President, Russell Huegel said. “When times were tough, we foresaw that redevelopment was going to assist and alleviate budget problems down the road. In the next 2, 3, 5 years down the road, shared services will be the next catalyst this town needs.”

Tomkins explained that the greatest source of revenue comes from the downtown redevelopment project – about $50,000 in total. Tomkins also predicted that this source of revenue will continue to grow year after year, anticipating a total of $100,000 in revenue for the 2013-2014 municipal budget.

As the new budget stands, Fanwood will not incur any layoffs and will maintain all current services supplied. The cost of contributing to police and public service pensions was down, as is the Borough’s salary count, which was down about 3.8 percent, Tomkins said.

“We have handled the development of downtown in a way that has given us additional revenue,” Tomkins said. “This is the first year the tax payers are benefiting from downtown redevelopment.”

The use of two sewage authorities stands as the biggest line item increase for 2012-2013. Tomkins noted that this is an item that the Council had considered charging residents for by creating a sewer rate, but voted against doing so.

“We may be the only community in this area that is not doing that,” Tomkins said. “I would suggest that at some point we reconsider [creating a sewer rate.] We can’t sustain these kinds of increases forever. Between the two sewer authorities we now pay for, this has become the largest single increase in the budget.”

Because the budget came in under the 2 percent cap, the council also passed a resolution to establish a cap bank in order to save those funds for emergency use.

With two police officers and one public works employee retiring within the year, the council chose to follow a recommendation made by Tomkins that will help offset the cost of contributing to those retirements. This came in the form of a resolution to allow the borough to fund the retirements over a period of five years by creating a Special Emergency Appropriation for Retirement, Severance, and Liabilities. This was done with the intent of easing the tax burden.

Long time Fanwood resident, Joe Nagy came to the podium during the public forum to compliment the council for the minimal increase in the 2012-2013 budget. Nagy expressed that the council had been working to carefully manage borough finances long before the 2 percent tax levy cap had been enforced and asked the council to describe their secret to financial stability.

“We were ahead of the game,” Tomkins responded. “We are not experiencing difficulty conforming to this cap because we were forced to reduce our level of operations and appropriations without eliminating services long before there even was a 2 percent cap.”

“It’s pretty simple – we knew how to manage our money,” Councilman Parenti added.

In addition to the conversations regarding the municipal budget, the Council also witnessed several proclamations and presentations honoring esteemed volunteers and community members including EMT Ian Lewis, Poet Laureate, Adele Kenny, local girl scouts, members of the historic society and former Fanwood council member, Joan Wheeler. For more on Tuesday’s presentations, check out the photo gallery accompanying this story.