By Sunayana Prabhu
HOLMDEL – Mayor Rocco Impreveduto’s first State of Holmdel address was all about maintaining “absolute transparency” and pivoting from “fiscal responsibility” to “fiscal conservatism.” The mayor presented the data-filled address to residents March 19 at the Holmdel Town Hall prior to the scheduled township committee meeting.
The township’s financial health is “strong,” Impreveduto said, but noted the governing body’s “primary focus” is to “slow spend” while still giving taxpayers what they need. Holmdel is AAA-rated, the highest standard rating given by trading experts to establish a municipal- ity’s creditworthiness. The township also boasts a stable tax rate with “0% municipal tax increases for quite some time,” Impreveduto said.
However, the mayor presented a snapshot of the town- ship’s financial patterns from the past decade that shows “municipal spend outpacing inflation.” Impreveduto as- serted the need to exercise budgetary restraint to pre- pare for unavoidable economic uncertainty.
Revenue Sources and Allocation
The revenue streams that fund the township’s entire budget – which was $30.3 million in 2023 – come from four major sources: property taxes, the PILOT (payment in lieu of taxes) program with Bell Works, any prior-year fund balance, and miscellaneous revenues.
The township has a $5 million budget surplus from last year, funding almost 17% of its budget. The PILOT program with Bell Works brings in nearly $7 million, contributing 23% to the township’s budget.
Property tax revenues fund “only 50%” of the township’s budget,” Impreveduto explained.
While the tax levy for Holmdel is “just under $91 million,” the mayor said, those tax dollars are allocated to three separate budgets – Holmdel’s municipal budget, the Holmdel Board of Education budget and to the county. Nearly $61 million of the amount collected goes to the Holmdel Board of Education; $16.8 million goes to Holmdel Township (that includes the municipal open space fund which residents voted to increase a few years ago); and nearly $12 million goes to Monmouth County to fund budget items, including open space, health programs, the library system and much more. In the redevelopment agreement for Bell Works, the township ensured that 95% of the money collected from the PILOT program stays in the township.
The remainder of Holmdel’s budget is funded by 20% miscellaneous revenue which comes from one-time benefits and ancillary fees like state energy tax relief and construction code fees.
How the Money is Spent
The revenue streams are channeled toward the operation of the township’s infrastructure, both departmental and nondepartmental spending.
A little over half of all township expenses are primarily costs related to running its four departments – public safety (including police, EMS and fire); department of public works (including road work, snow removal and recycling); general government (including administration and legal fees); and community development and recreation.
The remaining amount is spent on nondepartmental expenses, which include payments of outstanding debt, employee salaries, pension plans, insurance, shared services, and the capital improvement fund.
Fiscal Trends and Future Outlook
Considering the fiscal trends in the past decade regarding spending, debt service and incoming revenues, Impreveduto emphasized a more conservative approach for 2024.
Over the past 10 years the township budget “has increased 47%,” Impreveduto said, but at the same time, “inflation has increased 32%.” The town’s spending was “increasing at a historic rate. Debt service likewise spiked to historically high records,” the mayor said. Meanwhile, the town’s tax rate has remained at 0%, indicating it will need to find alternative sources of revenue to fund spending in the future.
Debt service is the largest portion of the town’s spending at 5.2 million, “the “highest it has ever been,” Impreveduto said, highlighting the need to “tighten the belt” and make budget adjustments sooner rather than later to “avoid a crisis,” while also acknowledging the challenge of uncontrollable factors such as inflating gas prices and health insurance costs.
He commended the Bell Works program as an “economic engine” that allowed the township to increase spending without raising taxes. It has brought in “$26 billion in revenue since 2018,” Impreveduto said, but unfortunately, it lacks “long-term sustainability.”
Although Impreveduto emphasized the urgency for “budgetary constraint” and the need to “pace out initiatives,” he said that doesn’t mean the township is “not going to do things.”
“We are fully committed to preserving open space, staying ahead of property matters and responsibly managing potential new developments,” Impreveduto said. The township has been “diligently procuring” grant funds for various projects and nearly $5 million has been awarded so far.
In the quest to preserve the Holmdel Horn Antenna on the township’s Crawford Hill site, the township purchased the property for the soon-to-open Robert Wilson Public Park in January for $4.75 million and has estimated another $1.68 million in the preliminary project budget to construct of the park and its components. Additionally, the Monmouth County Commissioners recently granted $3.5 million and Rep. Andy Kim (D- NJ) announced another $500,000 in federal appropriations toward the development of the Crawford Hill site for Robert Wilson Park and the preservation of the legendary antenna.
The 35-acre park will be named for Nobel Prize-winning physicist Dr. Robert Wilson, a longtime resident of the township who, along with research partner Dr. Arno Penzias, discovered irrefutable evidence of the Big Bang theory of the universe using the Horn Antenna.
The township is currently cleaning up the property, removing hazards to ensure a safe environment and also sending out a request for proposal (RFP) to start evaluating companies to design and draft concept plans to be presented to the public.
Robert Wilson Park is set for an official ribbon-cutting April 20.
The article originally appeared in the March 28 – April 3, 2024 print edition of The Two River Times.
