Mayor: ‘It hasn’t come in yet’
HAMMONTON—On March 11, President Joe Biden signed into law a $1.9 trillion economic stimulus bill known as the American Rescue Plan Act of 2021, also called the COVID-19 Stimulus Package. The day prior, Senator Cory Booker (D-N.J.) and Senator Robert Menendez (D-N.J.) announced in a release that the state of New Jersey will be receiving $10.189 billion as a part of that act.
Of those funds, Hammonton will receive $1,368,767.64.
However, Mayor Stephen DiDonato told The Gazette that “it hasn’t come in yet.”
Robert Scharle, Hammonton’s Chief Financial Officer, explained further.
“We’re going to have to work through the state to draw down those moneys, but we’re still waiting for guidance on how to do that. I don’t know why ... I’ve had numerous emails to the state asking them for guidance with what they call a local finance notice. Evidently, they haven’t come out with anything yet. On April 28, I checked with the director and she got back to me and said, ‘the official rules aren’t enacted from the federal government until May 11.’ I said OK, fine. I’ll wait for then. Here we are three weeks later and I still don’t have anything,” Scharle said.
Frank Zuber, the town’s business administrator, confirmed Scharle’s statement.
“We do not know. Hopefully, before July, but I don’t know the exact date,” Zuber said.
Scharle said that, while the start date of the availability of the funds remains unknown, there is a deadline.
“What’s available to us—and we haven’t gotten anything yet, because we have to go claim this—we have to go in by September 30 and claim the money that we utilize. We’re eligible to draw down half this year and half next year,” Scharle said.
According to the release from March 11, the direct, flexible funding “can be used by state and local governments to pay COVID-related expenses; cover lost revenues due to the pandemic to maintain critical services and avoid layoffs of essential workers; provide additional assistance to residents and small businesses; and invest in water, sewer and broadband infrastructure.”
Scharle said that, absent guidance from the state, the town has conducted “as much research as possible, and worked with our auditor, to find out what we’re allowed to use it for.”
“There is one critical area that we’re using it for this year: loss of revenue. What happened was, last year our municipal court fines—and this was everybody, across the state—were down. Construction code fees were down. Water rent collections were down, because our governor put a moratorium on sending out delinquent notices for water. With all that, we lost revenue,” Scharle said.
Zuber said that, while town officials were still waiting for specific guidance as to how precisely the funds can be spent, they do know that the town is “allowed to use a portion of the money this year.”
“In the budget itself, in the current fund and the utility fund, there’s revenue coming in from that for lost revenue from last year. There was a calculation that they gave us that we had to do; that’s how that was determined,” Zuber said.
According to Zuber, $231,289 will be used in the general fund, and $369,429 will be used in the utility fund, totaling $600,718.
“It’s a revenue line-item in the budget, so we don’t have to cut somewhere else on the expense side. It’s just money coming in on lost revenue from last year. It’s not for anything; it’s just a revenue line to help us with our operating expenses this year,” Zuber said.
One caveat of the funds, Scharle said, is that municipalities that receive the funds are not allowed to lower taxes.
“That doesn’t mean that you can’t go to zero, but you’re not allowed to lower taxes—so we’re not lowering taxes, but we have a zero tax increase. If we had received that court money and the construction money, we would have had a zero tax increase anyway. That’s what this money’s for: to supplement what we lost. I agree with the aspect that you shouldn’t be able to lower taxes than what you had before. That’s not what it was for. It’s for loss of revenue and infrastructure,” Scharle said.
Scharle reiterated that covering revenue losses was the town’s priority.
“Right now, we’re focusing on loss of revenue, because we lost money in court, in construction code, in water rents and connection fees ... We’re not even using the infrastructure right now; we’ll probably use that next year,” Scharle said.
Under the current calculations, there will be $768,049.64 remaining for 2022.
“Next year the balance will be used for an infrastructure project; that’s why we’re going out to design now,” DiDonato said.
The design to which DiDonato is referring regards an action item that Town Engineer David Cella presented in his report during the May 24 meeting of town council, ARH (Adams, Rehmann and Heggan Associates) No. 21-0078, 2021/2022 Water Capital Projects.
According to that item, the town and ARH “have worked together to prepare a plan to meet the NJ Water Quality Accountability Act.”
“As part of the plan there is a required annual capital improvements plan to reinvest into the existing system. Using the recommendations previously provided with the Water Quality Accountability report it is the town’s intention design in 2021 and construct in 2022. Over the past couple of months, we have worked with town officials to define the proposed scope of work and anticipated budgets for the projects. It is planned to have the following projects enter the design phase in 2021: Rt. 54, First Road to Second Road; S. First Road, Tenth Street to dead end (in the vicinity of Birch Drive); White Horse Pike and Seagrove Avenue, a portion of main at the WHP & extension along Seagrove,” Cella’s report stated.
At the meeting, council authorized ARH’s proposal for professional services for the survey fieldwork and design activities in the amount of $108,000.
DiDonato said that there is a particular infrastructure project in mind for the funds.
“The other $700,000 will go to a project, most likely the water line on Bellevue Avenue; I think that’ll be the first one out. It will go to one of those projects; whichever one, we have to get it done in 2022,” DiDonato said.
Regardless of which project the town chooses, Scharle noted that the funds do have an expiration date.
“From what I understand from the regulations from the federal government—not the state—we’re eligible to draw down those moneys up until the end of September 2023. If you don’t use the money by then, you’re not going to be able to draw anymore down,” Scharle said.
DiDonato did not see that as an issue.
“We’re not going to be sending any money back to the federal government; we’re not going to swing and miss. If we’ve got it, we’re going to use it,” DiDonato said.
DiDonato also commented on the benefits of the funds helping to ease the burden on local taxpayers.
“The lost revenue piece, I think, was important, and to get an infrastructure project paid partially or, depending on the size of it with the other $700,000, I think is tremendous for the town. It helps the rate payers; it’s ultimately their tax dollars, whether it’s federal or not, but it’s all coming back to Hammonton, which is nice to have once in a while,” DiDonato said.