Howell Council Urges Defeat of MRRSA Budget

With the Manasquan River Regional Sewerage Authority (MRRSA) set to vote on a budget for the upcoming year that would include a rate hike of roughly six percent for Howell residents, the governing body urged its representatives to vote against the hike. 

At Tuesday night's meeting of the Mayor and Council representatives from Howell, Freehold and Farmingdale addressed the dais giving them a chance to ask questions before a Wednesday meeting of the MRRSA finance committee. 

The most outspoken members of the council were once again Mayor Robert Walsh and Deputy Mayor William Gotto. The mayor set the tone right from the start of the discussion. "It's a little bit disturbing to me that while in Howell Township we were furloughing all of our employees and the ones that were working were taking wage freezes," he said. "We did not know that increases were being given of four to six percent across the board at the sewer authority. So to me that is very disturbing."

Budgetary Questions

Mayor Walsh said with township employees taking pay cuts and sewer authority employees taking raises there seemed to be an inequality in the situation. Especially given the tough economic times, Walsh said he did not believe it was fair to the residents of Howell to see their rates hiked to pay for the raises.

Richard Gatto, one of the representatives from Freehold Township made his first appearance in front of the council to discuss the situation. Having not been on the board for two full years he said he was unable to provide information dating back before the start of his term.

Talking about his time on the committee, Gatto referred to the situation as an "imperfect storm," when referring to the rate hikes. That includes not only the salaries but the impact of Hurricane Irene and another big storm in Oct. which he said caused damage of approximately half of a million dollars.

He said when it comes to the damages the authority has applied to FEMA and to their insurance company to be reimbursed but they did not yet know if or when that would be realized.

Gatto said from 2006 until 2011 total salaries went from $865,000 to $923,000 over that time. He estimated that to be six percent over a five-year period. He also pointed to connection fees as another factor in figuring the budget. In 2006 the sewer authority made $654,000 while in 2009 that number dropped to $144,000, which he attributed to the economic downturn. That number jumped back up to $580,000 in 2010 before  dropping back to $385,000 this year. 

Questions were also asked about the surplus of the sewer authority. Gatto said in 2006 there was a surplus in excess of $7 million. It dropped close to $2 million the following year. He said from 2006 to 2010 capital projects were paid for out of the surplus. "The sewer authority has used surplus the last three years but basically the surplus is gone," he said. 

Over the past few years Gatto said Howell has seen increases of four percent, six percent, 9.75 percent and six percent this year. 

After his presentation, it was the council's turn to find more answers to their questions. "I'm sitting here listening to you tell me that they're taking from surplus in 2006 and 2007 to pay their obligations. As the surplus is coming down, at the same time they're giving themselves six to seven percent raises a year," said Walsh. "What's wrong with this picture? Are they public servants? Who's getting six to seven percent raises a year."

Walsh said he understood some of the explanations given, but he also said he understood the questions residents have about the rates they have seen not only from the sewer authorities but the other utilities as well. "This is just unacceptable," he said. 

Farmingdale Councilman Bill Donovan said his borough was also having trouble with the rate increases. "Last year alone Farmingdale Borough took a $40 thousand hit. It might not sound like much to most people but to a small borough like that it really hit home."

Other Factors

Gatto said that while the salary increases were part of the rate increases; they were not the entire equation. Deputy Mayor Gotto said comparing Howell's budget and the sewer authority were "in opposite directions and getting further and further apart every time we turn around." 

The Deputy Mayor said he has heard several of the reasons Gatto gave in the past for the reasons for the increases. "I heard them referred to as pass throughs'. There is no such thing as a pass through," he said. "We don't have an avenue to knock on a sewage treatment authority's door and examine what they do and how they do it. What cost do they do it for, but you do. That's the business of what you do." 

When it comes to the term pass through, Gotto said he accepted that in the past based on the belief that better options were coming in the future including the paying off of the authority's debt service. He said he was also told that estimated flow rates would help Howell's amounts. "I was guaranteed at that meeting that those numbers would be decreased. A couple of weeks ago we get a report that shows me exactly the opposite," he said. "We're growing in opposite directions here. We're trying to shrink and every single thing that we see from MRRSA shows that we're trying to get bigger."

Gotto said the two entities have a lot in common when it comes to their budgets. "Howell Township is an exact duplication of every single item that you're bringing up," he said. That includes reduced revenue, a lack of interest income and other financial losses. "We're very familiar with every one of your issues, the difference is in this municipality we're not even close to doing what MRRSA is doing to the rate payers."

Possible Solutions

Because of that, Gotto said the answers they were getting were not sufficient. "On every one of those avenues I know there's an explanation. I know you can explain how we got to this point but regardless of what that explanation is, it's no longer acceptable. It just cannot be viewed in any way shape or form as any form of business as usual."

Gatto said not all of the five townships that use MRRSA are seeing increases. That includes neighboring Wall Township, which will see its residents enjoy a nine percent decrease. He said he was unable to say why one township was seeing a decrease and another an increase. 

Jesse Tantillo, one of Howell's representatives to MRRSA said he has tried to get answers to questions about the township's flow rates. "It's basically been told that it is what it is and there's really nothing we can do about what they say," he said. "We always get it's not an exact science and at the end of the year if they say it's too much you get the money back. Those are their two stand alone questions."

That answer only seemed to upset members of the council more. Gotto said, "For the rate payers to have to pay out of their pocket with the hope of getting it back because it's not an exact science, I cannot ask the rate payers of this town to keep doing that," he said. 

Tantillo replied, "You can only ask the question so many times and get the same answers and ask it a different way and get the same answers." Gatto added that when it comes to the various rate changes, each of the five towns has different needs. "If you take five municipalities with five different needs or flow requirements, you couldn't put this into one package."

Gotto said he saw many questions still remaining as the authority looks to pass their budget. "If you put those things together, you as commissioners and I've said this to our representatives on numerous occasions, you're representing us as these meetings to prepare these budgets. If you don't have those answers, I'm going to ask you personally please don't vote for the budget. It's as simple as that."

He added. "If we don't have the answer, that means you don't have the answer. To me it means you shouldn't be voting yes on the budget."

Gatto said that while he did not have the answers available when it came to the flow rates, he believed the other information could be helpful in reaching a decision. "When you sit there and they explain how they calculate the flows and how the credits are done, it's understandable. You may not agree or like it, but there's nothing to rebut."

The Freehold representative added, "When the explanation is given and there's nothing to refute it with, I sympathize with what you're dealing with but there's nothing to refute it."

Deputy Mayor Gotto said he did not share the confidence of Gatto considering all the questions and issues he considered to still be unanswered.

Mayor Walsh agreed saying he wanted to make sure there was equality in the burdened being shouldered by the taxpayers. "What I'm seeing, is not shared pain," he said. "What I'm seeing is pass through fees, raises."

Councilman Robert Nicastro said he believed the people involved could work together to find a solution. "The townships, the people they want two things. They want to receive the service effectively and cost efficiently," he said. "I could understand infrastructure, I could understand utility costs going up. I could understand pumps. It's a business, it's a service there's always going to be costs associated with it." He called what they were discussing on Tuesday "a tough pill."

Councilman Juan Malave, who was sworn in on Tuesday night, agreed in the council's objections to the increases. "Like the mayor stated many times it's just not acceptable. We just can't keep swallowing these increases," he said. The newest member of the council also encouraged the represenatatives to vote against the budget with the proposed increases.

The finance committee meeting is scheduled for 5:30 at MRRSA's headquarters on Havens Bridge Rd. Before that, there is scheduled to be a public hearing at town hall about a proposed rate increase by New Jersey American Water. That hearing is scheduled to start at 2 p.m.