FY2004 BUDGET MESSAGE

							                             FY2010 BUDGET MESSAGE

The Township remains in positive financial health, though the generally poor economy
has caused some problems and is restricting some worthwhile activity.
General Fund (GF). The General Fund is balanced at $1,364,000, a 7.7% decrease from
last year and a cumulative 14% decrease from 2007. FY2009 performance fell short of
expectations, and the deficit is projected at $60,000-$75,000 for the year, to be bridged
from unencumbered cash reserves in the GF.
GF Revenue. There will be no real estate tax increase this year. For the second year in a
row, transfer tax revenue has been in steep decline. This revenue source represented 15%
of total revenue in 2007, and was cut in half in 2008 and was cut in half again in 2009.
For FY2010, the transfer tax revenue is projected flat from FY2009. The Township’s
largest revenue source is the Earned Income Tax. EIT has traditionally grown at an
average of 7% per year. The Township projected 6% growth per year when computing
debt service revenue available for debt service payments. EIT fell 1.8% from 2008 to
2009, and is projected flat for FY2010.
GF Expenditures. The most significant single item this year is debt service of
$268,000/year. The Township has already banked one year’s debt service payments.
Capital Reserve Fund (CRF). The long range forecast for the CRF is positive, as there
is no unfunded depreciation from equipment purchases that preceeded the fund’s
inception in 2002.
This year’s CRF budget reflects one major expenditure, a storm sewer project on West
Walnut Road for approximately $48,000.
Operating Reserve Fund (ORF). The Op Reserve Fund is healthy and available for
contingencies. The Township set aside approximately 5% of annual revenue each year
from 2002-2006 for emergencies. The ORF has reached its goal of $350,000 in rainy day
savings.
The Township Manager has suggested the Board use up to $70,000 in ORF to create an
Act 209 traffic impact fee ordinance. The traffic impact fee would be levied on all new
development in the Transportation Study Area (TSA), in this case congruent to the
Rocklyn Station Strategic Development Area. The money generated from the impact fee
could be used to fund off-site improvements in the TSA. Eventually the economy will
rebound, and when development begins again, having the TSA in place will improve the
Township’s position to get necessary road infrastructure built and funded by private
development.
State (Liquid Fuels) Fund (SF). This money is allocated from the Commonwealth each
year for road maintenance and equipment purchases related to road maintenance. The
Township has set aside 20% of its annual allotment each year for the last seven years. In
2007 the Township used $145,000 of the reserve towards the replacement of the road
grader. This year’s operating expenditures will be used for the annual sealcoat project,
asphalt overlay project and line painting project. The Township typically sealcoats 7 to 8
miles of road and overlays 1 mile of road as preventive maintenance.