Springfield's Budget Brings Slight Tax Decrease

Despite a precipitous drop in state aid and continuing economic struggles throughout the state and the country, Springfield's budget is looking comparatively drama free. While other state municipalities are raising taxes by double-digit amounts, Springfield taxes are actually going down slightly from the previous year. Even more surprisingly, the tax  spite of a loss of $450,000 in state aid, Springfield's budget calls for no lay offs or major cuts.

The balanced books are due, in a large part, to the town's decision to shift the cost of the RVSA from its overall tax bill to a separate utility charge. That move took just under $2 million worth of expenses out of the proposed budget, which currently calls for $25,590,996 in overall spending (that number does not include spending on schools; the school system has a separate budget). Otherwise, the cuts are smaller. The Township's Finance committee went through each department individually looking for ways to cut money. For example, the Library is getting the minimum amount of funding from the town allowed under state law.

Springfield is a small town with a lean operation with some departments staffed by a single person. As a result, cutting back on staff or staff hours wasn't practical.

"We looked at furloughs and we looked at layoffs," Finance committee member Jerry Fernandez said. "The savings just aren't there."

Furloughs and layoffs wouldn't impact the township's largest expense, health care. The township currently is slated to spend about $4,685,000 in healthcare costs for municipal employees.

Fernandez said the town was looking for its broker to come up with a better deal with healthcare and is exploring options such as joining up with the school system in shopping for deals.

"Even if we could get it down by just 10 percent, that would be over $400,000," Fernandez said.

After healthcare, the township's next largest expense is pension payments. Last year, the committee voted to defer $700,000 worth of pension payments. As a result, the town's pension costs are going up dramatically; pensions for police and fire doubled from about $600,000 to 1.2 million. Overall, the town's healthcare costs are increasing by 23 percent over the previous year.

When they were devising the budget, Fernandez and his fellow finance committee members had hoped to include a modest (half percent) tax raise to pay down the town's pension debt. That plan was dashed when the Springfield's chief financial officer Michael Quick advised them that the move was not legal.

"There's a big gorilla of $700,000 that we're paying 8 percent interest on," Fernandez said.

While the township is looking to tackle that cost, they will also have an eye towards spending on town improvements. The Township has a double A bond rating, and officials believe that with interest rates that are three percent and less available, the time is right to got out to bond to fund capital.

"Our CFO said that in all his years working in government, he's never seen interest rates so low for a town," Fernandez said.

There will be a public presentation of the budget on July 13.