‘Skinning the cat’

A $24.8 million budget for 2025 that cuts several positions, takes other austerity steps, and will raise municipal taxes by 2.5% has been introduced by the Borough Council. With it came cautionary words that new revenue sources need to be found to avoid future fiscal problems.

“When I tell you that we really skinned the cat this time, we really did,” Mayor Jack Mikolajcyk said of the scrutiny officials used in compiling the new financial plan. The budget was unveiled at the governing body’s Tuesday, April 8 meeting.

The mayor quickly added “the well is dry,” making the point that modest redevelopment should be pursued to bring in new ratables. “We don’t want to be a Bound Brook where we have buildings 28 stories in the sky,” Mikolajczyk said of that town’s various high rise projects. Instead, Middlesex should focus on renewal of “dilapidated” sites, he said.

Dozens of properties have been removed from the tax rolls in recent years, mainly due to construction of the U.S. Army Corps of Engineers’ floodwall construction. That’s been a budgeting obstacle for municipal officials, the mayor noted.

“We’ve lost 90 houses,” he said. “That’s the better part of $1 million (in annual tax revenue).”

Middlesex Borough has also endured an ongoing lack of support from Trenton in terms of municipal aid. Mikolajczyk characterized Middlesex as an “underserved community,” noting that state aid has virtually remained flat since 2016.

The reason why, he speculated, is that the borough’s all-Republican mayor and council are on the “wrong side of the aisle” from Democratic Party controlled state government.

Mikolajczyk called the governing body’s new budget “appropriate,” adding, “We tried to be fiscally conservative and we have been.”

“We’re at a very dangerous spot,” the mayor said. “We have to get creative and we have to get smart about the way we spend our money, and what we’re going to do to bring in revenue.”

Middlesex Chief Financial Officer Caroline Benson outlined the challenges officials faced in this year’s budget process. The mayor and council pursued a target of a 2.5% tax increase but various items rose at a higher rate.

Among them were workman’s comp, fire hydrant fees from NJ American Water (8.2%), electricity (about 17% as of June), pension costs for municipal workers (6%), police pension costs (13%), recycling charges (28%) and emergency dispatching (15%).

Benson said there was virtually nothing officials could do to deal with those specific costs since they are outside municipal control or in-line with market prices. “There isn’t a better rate available to us elsewhere or by looking for a different vendor,” she said.

To rein in the effect on taxpayers, compensatory steps were taken such as eliminating one police officer’s position and two more from the parks department, cutting the Recreation Department budget by 30% and engineering costs by 42%. Community Day was also put on the chopping block. The event will not be held in 2025.

The $350,000 proceeds from the sale of a borough-owned lot adjacent to Cook Field will be used as revenue to help fund the budget.

The average Middlesex home is assessed at $483,000 and its owner will pay $2,951 in municipal taxes in 2025, according to Benson. The council’s budget accounts for 30% of a Middlesex Borough property owner’s total tax bill.

The local school district budget accounts for 54% of the total bill. The Board of Education recently introduced a 2025-26 spending plan that increases taxes by 2%.

The Middlesex County budget comprises the remaining 16% of the property tax bill. Borough officials have not yet received word of how much county taxes might rise this year.

The municipal surplus will increase by about $100,000 this year, according to officials. Borough Administrator Michael LaPlace noted that municipal debt has been decreasing in recent years and 2025 will see debt from the police headquarters construction paid off.

Fiscal rating agency Standard & Poor’s has “strongly encouraged” the borough to continue working toward its goal of having a $3 million surplus, LaPlace said, and to perhaps even increase the goal.

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