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CFO Goldy Answers Concerns About Cap Bank – 4/18/16 Budget Review Session

PERTH AMBOY – Five Department Heads (Police, Fire, Code Enforcement, Recreation/Human Resources and Department of Public Works) were on hand to give their departmental reviews.

Deputy Chief Cattano was scheduled to speak first, but before he did so, CFO Jill Goldy wanted to clarify what the Cap Bank entailed. The whole Council was in attendance along with City Clerk Elaine Jasko and Business Administrator Adam Cruz.

Perth Amboy CFO & Comptroller Jill Goldy

Perth Amboy CFO & Comptroller Jill Goldy

Goldy stated, “There’s two parts to the cap: appropriations and a tax levy. Each has a 2 percent cap. We did a cap of 3.5 percent which is allowable. The general cap is usually 2.5 percent. The Cap Bank has nothing to do with the surplus. It’s not cash, but appropriations. It’s not the City’s money per se. The cap laws are rather complicated. The excess revenue and the under spending surplus appropriations have nothing to do with the cap. The cap is based on surplus we had in previous years. It went from $2 million to $3 million this year. We had an increase in a lot of building permits which will increase the surplus to $5.9 million. Of that amount, we have $3 million to use and we can cap the excess $2.9 million.”

Councilman Fernando Gonzalez had concerns. “We should at one point start thinking about giving money back to the taxpayers.”

Councilman Fernando Irizarry answered back to Councilman Gonzalez, “You didn’t mention the debt the City owes.”

Gonzalez countered with, “We have had the same amount of debt for the last 8 to 10 years. It’s taxpayers money, and we should figure how to start paying it back.”

After this exchange between the two Councilman, Deputy Police Chief Cattano spoke, “There has been a decrease of 8 percent in the Police Department’s Budget. There is a $80,000 trust fund for vehicle maintenance plus administration fees (for people who hire off-duty police) and workers compensation. Purchase of new vehicles went down $20,000. For operating cost, the purchasing of vehicles to replace the older ones (which had large maintenance bills). We have been able to maintain an increased amount of training. Officers are sent out to get additional training. When they come back, they are now able to do inhouse training of other officers in those additional skills that they learned. There’s a $10,000 decrease in purchasing of firearms and ammunition.”

CFO Jill Goldy offered additional information on the Police Department. “New Officers starting salary will be $19,000 until the end of the year.”

Deputy Chief Cattano answered a question posed by one of the Council Members about the salary. “There is a ten-step salary scale for new Officers and I will get back to you with this information. Eight percent of our Officers have less than five years on the job.”

There was also a question about a line item of $75,000 for software. CFO Goldy responded to that question, “The software in question is a priority maintenance cost for the Police Department. This information cannot be shared with other departments.”

Statement by CFO and  Comptroller Jill Goldy – 4/18/16 Budget Hearing

PERTH AMBOY – In New Jersey, budget appropriations are generally subject to a year over year increase of two percent. The calculation of this increase is subject to various exceptions. As well, if an ordinance is passed by the local unit’s governing body, the local unit can elect to use a 3.5 percent cap and may bank the available amount to which appropriations in the adopted budget are under the 3.5 percent cap. Two years’ worth of cap bank are available for use in subsequent years’ budgets.

As it historically does, the City elected the 3.5 percent cap for 2016, not because it excepts to exceed the two percent cap on appropriations but merely to allow for the banking of the higher amount should capacity be needed for either the 2017 or 2018 budgets. In fact, if the 2016 budget is adopted as was introduced, such budget is well within the 2 percent appropriations cap.

The 2014 cap bank is $2,406,958.18 and will expire upon adoption of the 2016 budget. The 2015 cap bank is $1,220,358.53 and will remain available for use in the 2017 budget if needed. The 2016 cap bank, should the 2016 budget be adopted as introduced, would be $1,076,521.67 and would be available for either the 2017 budget if needed, or could be available for the 2018 budget.

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