presented: January 15, 2013
It is my pleasure to come before you to present the 2013 Atlantic County Executive Budget. I will be brief and to the point.
As you are well aware, the year behind us was a particularly challenging one. The derecho, which hit our area forcefully and unexpectedly last June, and Hurricane Sandy, tested the responsiveness and resiliency of Atlantic County government. We responded well to both emergencies. Yet in the aftermath of Hurricane Sandy we still have much to clean up, repair and rebuild. More than sixty days later, we still have residents who are unable to return to their homes and resume a normal life.
The year ahead will present its own challenges. Some of these are knowable such as a declining tax ratable base, a stagnant regional economy, and high unemployment. Others are not.
Atlantic County’s main industry, casino gaming, continues to lose revenue to other gaming jurisdictions. From 2007 to the end of 2012, the industry’s gross revenues have declined from approximately $5.2 billion to $3 billion. That means there is approximately $2.2 billion less circulating in the local economy than a few years ago. The gaming industry’s decline has contributed to a 14.5% unemployment rate. There are 25,000 fewer casino workers than there were just a few years ago. Many of those who remain in our workforce have had to accept significant wage and benefit reductions.
This trend has had a direct impact on our Department of Family and Community Development which has seen a dramatic rise in food stamp and TANF cases. In 2007 we had 17,917 individuals on food stamps. We now have 41,293 individuals on food stamps. Those numbers are expected to increase.
In 2008, Atlantic County’s equalized valuation peaked at $58,266,396,436. The rapid and steady growth of the casino industry in Atlantic City was the catalyst for much of the increase in the county’s ratable base. Times have changed. Atlantic City’s total equalized value declined approximately $1.86 billion from last year and is down approximately $7.8 billion from 2008. The effects of this are felt countywide.
Our frugality when times were good is paying off today. We did not incur a huge debt or expand services. We held our operational costs to a minimum. Now, when times are more difficult, we are still able to develop a budget that meets the needs of our citizens and is responsible to our taxpayers.
The 2013 County Budget that I present to you today is $193,837,029.86, a decrease of .13 % from last year. The Amount to be Raised by Taxation is $155,598,081.90, approximately $3,733,112.27 less than allowed by the state budget cap. Based on the best information we currently have available, we conservatively predict the County equalized Tax Rate will be remain fairly stable at .3438 and is still much lower than the .44 cents rate in 2000.
Total operational expenses are up less than one percent. Considering the increases in our fixed costs and the contractual yearly increases due our seventeen bargaining units, that is quite an accomplishment. As has been our ongoing practice, we are appropriating 50% of our year end surplus, $7,155.000 in the 2013 budget. Atlantic County does not have to worry about increasing its debt ceiling. Our total net debt as of the end of the 2012 fiscal year is less than three tenths of one percent of our total bonding capacity.
As we look to the year ahead it is clear that we must concentrate our efforts on economic growth and job creation. Jobs and growth will only come with cooperative and concerted effort.
We are prepared to undertake this challenge. Our thirteen perfect annual audits, strong and consistent bond ratings and low debt, attest to the soundness of our fiscal policies and the quality and experience of our financial staff. It also attests to the bipartisan cooperation we receive from this Board of Freeholders, a refreshing contrast to the dysfunction of the federal government when it comes to meeting its fiscal responsibilities, I would like to believe that Atlantic County might serve as an example for all levels of government. All of you help to make Atlantic County a better place and have my gratitude and appreciation.