$21.3M budget likely bumps average property tax $11 yearly

MONTVALE—The Borough Council approved a $21.3 million municipal budget April 26, at an increase of about $1.34 million, or an approximate 6.7% increase over the 2021 tab.

However, overall, local taxpayers will likely see a 1.63% tax rate increase in 2022, which includes taxes for the county, regional and local schools, and the public library.

The adopted 2022 budget is $21,344,035. The prior year’s budget totaled $20,003,197.

For an average residence assessed at $528,261, the projected increase in the municipal portion of the tax bill is about $11, Mayor Michael Ghassali wrote residents on April 26, ahead of the council meeting.

“We as a local government have to deal with inflation and increased product prices, contractual pay increases and other cost of living cost related increases, like every other business,” he added.

He said, “Our municipal taxes will only increase by $10.57 per year per average household in 2022. The fact is we could have kept it flat, but we want to increase our surplus by $150,000 and bring the surplus to over five million dollars. This is great news for Montvale residents and commercial land owners.”

A budget presentation at the Borough Council meeting provided a percentage breakdown of borough services.  

Some larger expenditures:  police, $4,390,100, or 20.5%; shared services,  $2,545,793, 11.92%, mostly Pascack Valley DPW shared with River Vale; utilities, sanitation and sewerage, $2,343,210; or about 11%;  insurance, $1,306,032, or 6.12%; and other governmental appropriations/services, $3,860,632, or 18.09%.

“I will also present tonight the additional anticipated tax revenue from the new ratables in town. In 2023 and beyond, we expect an additional $3.5 million — $4.4 million in added tax revenue, based on occupancy and construction completion dates.  The schools and the county will take a portion of that, and about a million dollars will be for the municipal side.  The council and I will work to use the extra revenue to reduce our tax rate which will reduce our tax payments,” Ghassali said.

Ghassali listed five new developments coming on the tax rolls that will contribute $3.7 million to $4.4 million. These  include:

  • North Market Building One ($860,300 in annual taxes);
  • North Market Building 3 and coffee shop ($860,300);
  • Thrive Assisted Living ($786,560); 
  • Village Springs ($748,697); and 
  • The Alexa ($467,936). 

As additional units come online at Village Springs and Alexa, tax revenues will increase, Ghassali said.

The presentation noted “challenges ahead” for Montvale that include new infrastructure investments, needed road maintenance, an aging sanitary sewer system, Municipal Building improvements, and “the changing corporate real estate environment.”

Other questions Ghassali said the borough face include: 

  • Are large corporate HQs going to continue?
  • Will tax appeals increase in frequency and size? and
  • Future costs of employee pension and health benefit liabilities.

An appendix attached shows a nearly 20% increase in employee health insurance costs, 2020 to 2021. This includes medical group insurance costs, up $34,313; dental, up $5,202; and health savings account (HSA) contributions, up $76,637.