Another bad budget bites the dust.
In June 2009, the Morristown City Council adopted a deficit Fiscal Year 2010 sewer fund budget against the advice of its paid consultant Lamar Dunn. [Dunn presented a rate study to council in June 2009 and told council that the FY 10 sewer rate increase should be 14% to cover sewer fund expenses. Council ignored the recommendation and instead raised rates by 8% in FY 10, adopting a deficit sewer budget] For more on adoption of the current deficit sewer budget, click here and here.
Now just seven months later, the Mayor and Council called Dunn to come to the Finance Committee meeting yesterday and give them a sewer "update." Without saying "I told you so," Dunn's update reminded the Mayor and councilmembers that they adopted a deficit budget (which they already knew) and that the city's sewer fund is in the hole as result (exactly what he told them would happen).
Solution. Pay Dunn for another rate study--since you ignored the last one you paid for.
Industries and residences better start socking away money--if they have any--for yet another big sewer rate increase.
Sewer costs are a major factor in the budgets of many existing Morristown industries and of industries that might consider locating here. With large sewer rate increases year after year, the City and Industrial Development Board (IDB)/Jack Fishman may at some point realize that spiraling sewer rates are one reason that it so hard to get new industry to locate in Morristown (without tax incentives) and that spiraling sewer rates have a negative impact on existing industries (that get no tax breaks).
And it goes without saying that skyrocketing sewer rates have a major impact on hard-pressed family budgets as well.
The new increase could be adopted right after Dunn's study is complete or it may be included as part of the adoption of the FY 2010-2011 sewer fund budget in May or June 2010.
[Dunn also told the Mayor and Council that the "unknown" regulatory cost that he mentioned in his June 2009 rate review is now a huge "known" regulatory sewer cost. Morristown is under a Commissioner's regulatory ORDER to fix sewer problems that were ignored for years and years, to develop and actually implement a maintenance plan, and to provide reports to the state for the next several years of compliance with the Commissioner's ORDER. This known regulatory cost will be a factor in Dunn's new study.]