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Jefferson Township
Jefferson Township, N.J. • 1033 Weldon Rd, Lake Hopatcong NJ.
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Roll Call
Roll Call

Present                                            Absent

Mr. Hardy

                  Mr. Sanchelli

                  Mr. Birmingham

                        Vice President Merz

President Yocum

                  Larry Cohen, Township Attorney

                        Lydia Magnotti, Township Clerk


            Mrs. Magnotti said, ?Let the record show that Mayor Felter will not be here this evening, however, Administrator Leach is present.  Also present is Bill Eagen, Chief Financial Officer, and Chuck Ferraioli, Township Auditor.


Salute to the Flag

President Yocum asked that everyone rise for the Pledge of Allegiance.


Notice of Presiding Officer

President Yocum said, ?This Council Workshop meeting for March 8, 2006, commencing at 7:30 p.m. has been properly noticed in accordance with the Open Public Meetings Act by notice to the official newspaper of the Township on March 2, 2006.?


Work Session Items:

2006 Budget Overview                                                                                                         (58-A)

Ferraioli began his overview with the Annual Debt Statement and told the Council that it is a statutory requirement.  The purpose of the Statement is to show the net debt of the Township that the taxpayers are responsible for which is included in the town?s budget.  The town?s net debt at the end of 2005 is $14,553,159.  Ferraioli said that by New Jersey Law, they are entitled to the average of the last three years equalized value or true real estate value.  According to law, the town is entitled to 3-1/2 percent of the equalized value and that allows a maximum debt of $80,471,871.  There is currently outstanding $14,553,000 so the town is under its debt limit by almost $66,000,000.  The net debt as a percentage is 0.63% so from a borrowing point of view, the town is in excellent financial condition.


            Ferraioli said that last year the cap law changed and the town will begin to feel the impact of that change this year and next year.  It will be extremely difficult for many towns to stay within the cap.  Ferraioli referred to the second page of his Statement to the Department of Community Affairs.  The cap this year is $11,221,747.  He explained that if the town chooses to enact an indexing ordinance, as per his recommendation, this will add an additional 1%, the cap will go to $11,331,227.  The town is also entitled to the prior cap bank from 2004 in the amount of $620 and from 2005 in the amount of $165,878 for a total of $166,499.  Ferraioli said that next year the cap bank will probably be zero.  This year the add on to the cap for new construction is $242,627.  The total maximum budget allowed within the cap this year is $11,740,354.  The current budget within the cap is $11,857,943.  Ferraioli said that $117,588 needs to be cut from inside the cap.  Right now the budget as it stands is over the cap and it cannot be submitted this way unless the Council chooses to go for a referendum to exceed the cap.  Cohen said if the Township derives income from other sources such as land sales, that money would go into surplus but if a substantial surplus is built up, will the town be allowed to use it to exceed the cap?  Ferraioli said the town could go to the Finance Board to apply to use the surplus.  Cohen asked if the cap law can be used in labor negotiations to hold down wages.  Ferraioli said he heard a bill was introduced that states salary increases cannot go above the cap, however, he has been in front of arbitrators many times and salaries usually follow those of surrounding towns.  Ferraioli said that insurances and pension increases are still outside the cap, however, he assumes once the pension hits the 100% mark it will be moved back in and he feels the insurance may move back in also.


            Ferraioli advised the Council that with regard to the Highlands Legislation, he is advising as many of his clients as he can to reinvent the watershed towns? coalition.  If the towns join together, they can lobby revenue back in the form of a water infrastructure surcharge.  This year the town has a cap add on fee of $242,627 for new construction but at some point, because of the Highlands, there will not be anymore building.  The building will be reduced to additions, garages and decks.  The town will be penalized from a cap point of view.  Ferraioli said that he had a bond sale in West Milford recently and it was noted with regard to their credit rating that although they have a large base, that base will not be growing and may stabilize due to the Highlands building restrictions.  Ferraioli said that as long as the Highlands is there in its present form, it will impact their bond rating.  Ferraioli said Jefferson will be impacted similarly.  The Highlands/Watershed towns should get together, communicate and eventually act as lobbyists to get watershed aid and a possible water surcharge.  Cohen said that the State has ruled with regard to the tax appeals this year due to the Highlands and if the town settles a case, then the town cannot apply for any funding to cover the reduction in the assessment.  The State has determined that there has to be a decision of the Tax Court, so every case will have to be tried.  Cohen asked if Ferraioli can send the town a letter explaining how the Highlands Act can affect the town?s credit rating.  He will then prepare a Resolution to be sent to the legislature and to circulate to other Highlands towns.  Yocum agreed and said that was a good recommendation.


            Ferraioli detailed the Water and Sewer Budget.  The Water Utility is in very good financial shape.  The Sewer Utility began 2005 with $118,314 in surplus and $118,000 was used in the 2005 budget.  The balance at the end of 2005 was $314.73, however, Ferraioli said they will be able to balance the sewer budget this year.  The water budget revenues exceeded what was budged by $386,204.  Ferraioli highlighted the Miscellaneous item which consists of connection fees, interest on investments and prior unspent budget.  Under Miscellaneous, $159,574 was budgeted and $307,470 was collected.  This year this was cut down to $120,000 so when they get to a point where the connection fees stop, this will not suddenly drop off.  Ferraioli said the surplus ended up being $396,901 and the balance as of December 2005 was $1,478,607.  The bottom line is the water utility is in good shape.  Yocum said that now the town?s reliance on the MUA water should be drastically less.  Leach said that they have finally passed some hurdles with DEP Water Allocation and the Highlands.  The application for the Peaks well was deemed complete and now the DEP has 400 days to review the application.  Hopefully in 2008 that well will be on-line.  At that point, the town will only need about 2,000 gallons instead of the 300,000 or 400,000 gallons that is currently being purchased from the MUA.


            Ferraioli then went over the Current Fund and said that $213,090 more was collected than was budgeted.  For delinquent taxes, the budget was exceeded by $16,128 and the current taxes exceeded the budget by $1,491,189.  Miscellaneous Revenues Not Anticipated, such as the land sale, totaled $331,490 as well as a sale of foreclosed property in the amount of $468,700.  The Payment in Lieu of Taxes on Real Property was $8,225.  The Balance from the 2004 Budget was $172,486 with Interfunds at $339,371 and Cancellation of Various Reserves at $55,888.  Ferraioli said that on the Debit side, under Interfund there is almost $1 million that is owed to current.  The majority of that is from the Open Space Fund because they are waiting for grants from the County and the State.  Once that money comes in it will turn to surplus.  In January 2005 there was $3,222,827 surplus, $2,090,955 was put back in, $2,023,531 was budgeted as revenue so on the face, the surplus is $3,290,251.  Ferraioli explained that because there are interfunds in the amount of $1,138,485, which are monies due to current fund, the real surplus at the end of the year is $4,428,736.


            Ferraioli spoke regarding the tax rate and stated that at this point they have to assume they will get the same State Aid as last year.  Using last year?s ratable base for this year?s budget, it would be a 5-point increase assuming there will be a cut to come within the cap.  Leach said it would come out to about $80 to the average homeowner whether under the new or old tax rate.  Sanchelli commented that this is just the town taxes, not including County or School.  Cohen said there should be a lot of tax appeals this year because of the Revaluation and Ferraioli said he would expect more next year.  Ferraioli stated that if Watershed Aid is not in the State?s Budget on March 31, the town should file for Extraordinary Aid.  Sanchelli complimented Ferraioli and stated he has done an excellent job as always.  Ferraioli asked if there were any questions.


            Yocum stated that he met with Leach and Eagen briefly prior to the meeting to discuss the Budget status and the $117,000 is doable.  Yocum asked the Council if anyone else had any questions for Ferraioli.  Ferraioli then urged the Council and Administration to contact their Senate and Assembly people.  The increases in pension costs are ridiculous and trying to get back up to 100 percent over a 5-year period does not make sense.  Ferraioli suggested speaking to the legislators about spreading the increases over a longer period of time.  Ferraioli was thanked for his presentation.


            Yocum reported that he would like to update everyone on the lawsuit that was being heard in Morristown concerning Taryn McNamara, the 17 year old Jefferson Township resident that was killed on Route 15 in 2003.  The suit was filed against the DOT by the family of Taryn.  Yocum explained that he, Leach, Mr. Chamberlain and Crp. Mueller were all scheduled to testify today.  Yesterday, the Deputy Attorney General filed a Suppression Motion to stop Jefferson Township officials from testifying at the trial because she felt there was a conspiracy amongst the Jefferson Officials because of failed attempts to get a traffic light installed on Route 15.  That Motion was heard and dismissed.  Yocum said that he testified for an hour and was cross-examined for 2 hours.  There was a break in the proceedings and then the DOT decided that it would be in their best interests to settle the suit.  Yocum said that this now allows that family to move forward and close this chapter.  Yocum then said that it is his hope that the DOT will alter the way they respond to requests from municipalities in the future.  Hardy commented that although Taylor Road has been made a one way, nothing has been done to alter the sight distance problem that caused the accident.  Yocum said that he was asked if making the road one way made it a safer intersection and he responded that it made it less dangerous.


License Fees for Plenary Retail Consumption License

            Hardy stated that increases in the license renewal fee have been worked out on a yearly basis up to 2010 representing an increase each year of no more than 20 percent of the prior year?s fee.  The State?s level is currently $2500.  The process of raising the town?s fee to be in line with the State fee began back in 2002.  Sanchelli asked if Club License fees will be raised and Hardy said they will remain the same.  Yocum asked Cohen to make the changes to the Ordinance for introduction at the April meeting.


Draft Animal License Sample Ordinance

            Yocum explained that through conversations with the Health Department, they arrived at the number 5 for licensed pets.  This does not make the residence with 5 pets a kennel, shelter or pet shop.  The Ordinance requires the owner to register with the Clerk?s Office on a form and be subject to a minimum of one annual inspection by the Department of Health.  There will be an annual fee that will be set by the Health Department.  Cohen suggested that the Ordinance read if you have 5 or more licensed animals in your possession and it would mean cats or dogs.  There was a discussion of the violations of the licensing ordinance and this new ordinance.  Yocum said they would like to keep this ordinance simple and the fee should be in line with $15 or $25 to cover the administrative portion of the ordinance.  Yocum advised that the ordinance is a preventive measure and in towns where similar ordinances have been put in place, people do not stop licensing their animals.  Leach asked if there was a reason why the license is coming from the Clerk instead of the Health Department.  Magnotti said she spoke with the Health Officer and she feels that because it is not the licensing of pets, it would fall into the kennel, shelter, pet shop licensing category and the Clerk?s Office would handle it.  Leach stated that the Ordinance would be enforced by the Health Department.  The Licensing Program in the Health Department can probably be modified to generate a report, by address, of residents that would fall under this Ordinance.  Yocum suggested they discuss the number of pets that the Ordinance should cover.  Cohen said it might be a good idea to generate a report detailing how many households this would affect.  Hardy commented that when residents go through the licensing process and license 5 or 6 pets, they can also take care of the pet fee at the same time.  Cohen added that this only affects pets that are 7 months or older and if an animal has a litter, it does not apply.


Adoption of Stormwater Management Plan

            Cohen reported that the Stormwater Plan that was prepared was part of the State requirement as part of the Stormwater Regulations.  Jeff Elam prepared this Plan and it was reviewed and approved by the Planning Board.  It is now up to the Council to adopt the Plan.  Cohen suggested having Elam present to review the Plan with the Council before doing a simple Resolution for adoption.  Magnotti stated that Elam sent the Plan to the Morris County Planning Board on March 3.  Leach said he will have an updated report on Friday from Elam.  Sanchelli stated that he does a lot of the Stormwater Management work for the County.  He spoke to a DEP representative last week about the illicit connection part of the Stormwater Management Plan, which is very stringent and almost impossible for the municipality to enforce.  The representative asked him to draft an idea of changes to the illicit connection part.  Sanchelli gave an example of an illicit connection as residential sump pumps connected to the storm drain.  Leach commented that there is no place else for the water to go.


Cohen reported that one of his partners is the Counsel to the Sussex County MUA and they are presently having the same problem that the Jefferson Board of Education is experiencing with the regulations.  The Sussex County MUA is attacking the rule making process that put the rules in affect and they are alleging that it is an improper ruling by the DEP.  Cohen said he is trying to obtain some information from the law firm that is handling their case so it can be passed on to the Board of Education.  Bradley Campbell has been subpoenaed for deposition.  The law firm they are using specializes in clean water regulations and they have said that New Jersey has overstepped its bounds.  The assertion is that the real reason for the regulations is not for cleaner water but to halt development and generate revenue.  Leach said he spoke with Coe today and learned that zinc can be added to a potable water supply because it is not a toxic substance.  In time, it will coat pipes and will stop other things from leaching through pipes into the water.  Yet, the DEP is demanding that the water coming out of the sewer plant have less zinc and copper than is present in the drinking water supply.  This has no affect on human health and has to do with the life forms that are in the area where the water is discharged.  Yocum asked that this matter be placed on the April 12 Agenda for discussion with Jeff Elam.


1,100 Home Development Border of Rockaway/Wharton

            Yocum said that it was thought that this project was not going to move forward because of the lack of potable water.  In the meantime, the Council has learned that the Town of Wharton is entering into an agreement with the developer to supply potable water in exchange for several million dollars worth of improvements to Wharton?s water system and a new municipal building.  Yocum stated that he has issues with this type of thinking and feels that the development will have an adverse impact on Jefferson Township and commuters coming out of Sussex County.  Yocum asked Leach if these stories are accurate.  Leach reported that he met with the Business Administrator from Rockaway Township, however, he did not speak to anyone from Wharton.  The project would have been stopped or reduced by half due to water concerns.  There were wells that could not be licensed because of problems from Pictatinny.  Apparently, Wharton entered into this agreement with the developers to give them the water they need.  The municipal improvements will be in the area of $4.5 million to Wharton.  Leach reported that they still may need an alternate water supply.  The wells that are of concern will have a filtration system but the DEP is demanding a backup system in the event the filtration fails.  This is where Wharton will come in.  Rockaway feels that they will have to sign off on this Agreement because it is in their Township with their water plant.  Yocum asked Cohen and Leach for recommendations on beginning discussions with Rockaway and Wharton regarding the impact on Jefferson and Sussex County.  Leach said Jefferson presently has a close relationship with the Mayor, Administrator, Assistant Administrator and Engineer in Rockaway Township so perhaps the Council sub-committee could begin by meeting with Mayor Sceusi and the Administrator.  Yocum said he has had some dealings with the Administrator of Wharton and possibly Leach could set up a meeting with the Administrators from Rockaway and Wharton so all the facts can be clear prior to the Council making a statement.  Leach could express the Council?s concerns and gather the facts at the three-way meeting.  Leach said he would first give the Wharton Administrator a call and meet with him.  Cohen suggested sending a letter to each Administrator expressing our concerns, asking about the status and asking to be notified of any public discussion.  Leach said he will call the Wharton Administrator tomorrow and then he will follow up with letters.  Cohen said that with regard to the DEP, if the deal is made, they will need a Diversion Permit.  Leach reported that he believes they have the Diversion Permit and there is a high producing well on the site.  There are concerns about a backup system.  Cohen said they will need Extension Permits from the DEP because water is going into another municipality.  This process will involve public comment and a public hearing.  Yocum commented that he is amazed that the designation of the Highlands is exactly around this project to exclude it from the Highlands.  Sanchelli asked if originally Jefferson was going to provide water for this development.  Leach stated that Rockaway Township needed water and had an easement in Jefferson Township on Taylor Road.  There was talk about a joint venture to build a pump station and joint water plant.  Eventually, the pollution concern came up with the Pond View Estate development.  Yocum said the other issue is that this development is being built in an area where there is concern about what is underneath the ground in those aquifers.  Yocum added that he also has an issue with a municipality entering into an agreement like this whereby they will benefit monetarily and they are not taking into account the impact on surrounding communities.  Merz asked if Jefferson was noticed in the very beginning because Jefferson Township property lies within feet of the development.  Yocum agreed that the town did receive notification of the project in the beginning.  Merz said the town has known it was being planned, although the Council may not have known all the semantics.  Rockaway has a water reserve in Jefferson on Taylor Road.  The MUA was looking to drill a well there but the DEP would not give them a permit.  Leach explained that the water fights have been going on forever.


Welcome to Jefferson signs on Rt. 15 and Berkshire Valley Road

            Leach reported that the signs will be done this budget year over the construction season.  They are looking for a boy scout to help with the project.


Miscellaneous/Public Portion

Yocum asked if there were any members of the public that would like to come forward with a question or comment and seeing no one, he closed the public portion of the meeting.


            Yocum advised the Council that there is a map of the Pond View Estate development on the table if anyone would like to take a look at it.


Adjournment at 8:52 p.m.

Motion:  Sanchelli, second Hardy

                        Mr. Hardy                                 Aye

                  Mr. Sanchelli                           Aye

                        Mr. Birmingham                      Aye

                  Vice President Merz                Aye

                        President Yocum                    Aye


Dated:  March 8, 2006


Attested:                                                         Approved:





_________________________                ___________________________________

Lydia Magnotti, Township Clerk                  Debi Merz, Council Vice President


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