The Borough of Montvale introduced its municipal budget on April 8, and as it stands it will result in a modest increase in taxes for property owners.

Producing the approximately $15 million budget, more than $9 million of which will be raised through taxation, presented many of the same challenges to the borough’s finance committee that other Pascack Valley municipalities have already been forced to wrestle with, namely the reduction in state aid proposed by Gov. Jon Corzine. According to borough CFO Ken Sescholtz, the state performed various calculations modifying its regular aid to the borough, and the “net effect is a huge decrease… and it hurts.”

The state has proposed to reduce municipal tax relief aid to the borough by $118,631 for 2008, a move that Mayor Roger Fyfe calls, “incredibly unfair.” As a result of having to start off “in the hole,” said Fyfe, “we had to make cuts to make up for it.”

The increased budget will mean that the owner of a house assessed at the borough average of $655,000 can expect to see a municipal tax bill of $2,547.95, an increase of $111.35 from last year. While for the time being the borough has only cut back on spending on non-critical projects, planning to purchase only one police vehicle this year as opposed to the anticipated two, and halting the supply of municipal leaf bags to residents, the mayor fears that if the budget does not pass as is, the borough will be forced to cut services.

“We live in an affluent area,” said Fyfe, “and people expect certain things… We are going to have several meetings to make sure that people understand that we can cut it down more” but there would be an inevitable reduction in municipal services. The question is whether taxpayers are willing to trade services for a flat tax rate.

Many of the factors influencing the increase in the budget are not left to the discretion of the finance committee. Like other municipalities throughout the Pascack Valley, Montvale has seen a large increase in various areas of expenditure that are controlled by the state. For instance, the borough will be required to contribute $50,764 more than last year toward the pension fund for public employees, a 79 percent increase. The contribution toward police pensions has also gone up dramatically, from $317,782 to $476,685, a 50 percent increase.

Another state-mandated expenditure is for the maintenance of Montvale Free Public Library. The 2008 budget has appropriated $711,664 for this purpose, $27,000 more than last year. However, Fyfe said, the library is a valuable community resource, and he “doesn’t mind” spending money on it. “Our library is absolutely gorgeous,” he said, “The programs are so varied.”

Fyfe also pointed out that the Montvale Library is currently running at “net-plus,” which means that more people from other towns within the BCCLS network (Bergen County Cooperative Library System) borrow materials from Montvale than Montvale residents borrow from other towns. This has allowed the borough to earn a small rebate back from the BCCLS this year, in the amount of $1,800.

The borough will also see a fairly large increase in its electric bill this year, due to rate hikes that homeowners have probably already noticed. The budget calls for an increase of $48,250, or about 31 percent. The only way to offset the increased cost would be to cut energy consumption, something Fyfe said the borough is already looking into. “We have the DPW superintendent and facilities manager in process of putting together a plan,” he said. Nevertheless, the borough will always have numerous “incidental electric bills,” due to the number of facilities it operates, including sports fields, the community center, and the municipal complex.

Other areas of expenditure include the debt service, or how much the borough plans to spend in payment of its debts, which totals $1,707,208 for 2008.

The borough will apply an anticipated $2,540,000 of its budget surplus toward the current budget, leaving $1,051,807 remaining in the surplus.

The capital budget totals $2,077,126, of which $1,277,126 will be borrowed to pay for projects in the upcoming year. The capital budget includes the following projects: $10,000 for the acquisition of computer equipment for the borough administration; $26,100 for a roof repair at Latrenta Field; $21,710 for the acquisition of a new police vehicle; $100,000 for improvements to the Fieldstone Fields; $47,000 for the acquisition of DPW equipment and building improvement; $300,000 for the improvement of Summit Avenue; $300,000 for the construction of a bikeway; $450,000 for the borough’s road improvement program; and $22,316 for the repair of the borough’s gabion wall. The council also expects to borrow another $400,000 in 2009 and 2010 for road improvements.

“Montvale is unique because we have a fairly new governing body; no council people have had a full term yet,” said Fyfe. He believes that this newer, “younger” governing body is able to work well together because “we are not letting things that have always been done stop us… It’s a learning process but it is going alright so far.”

He said that the finance committee has put a lot of hard work into minimizing the tax increase to borough property owners, but that does not mean that the budget is finalized. He urges taxpayers to come forward with suggestions on how the borough can further cut expenditures before the budget is adopted.

There will be a public hearing on the budget May 27, at 7:30 p.m. in the council chambers. “I plan to encourage public involvement in it,” said Fyfe, “I would love to have as much participation as possible.”