presented: January 27, 2015

As is customary, it is my pleasure to come before you to present the 2015 Atlantic County Executive Budget. This budget is a responsible and realistic plan that responds to the unique economic challenges that presently confront our region. As you are well aware, there has been a significant decline in the major industry that serves Atlantic County and in 2014 more than 8,000 casino jobs have been lost.

The closing of four casinos in one year has sent shock waves that go beyond Atlantic County. Our unemployment rate, 11.3%, as well as the rate of neighboring counties, is at the highest level in years along with the number of homes at risk of foreclosure. County government provides a safety net for our citizens. Generally the less fortunate you are the more you interact with county services. This year a greater number of people have come to learn more about what county government does as they apply for food stamps, Medicaid, Temporary Assistance to Needy Families, or General Assistance.

As I have said on previous occasions, a budget is most of all a plan for intelligent spending. In managing county government during these times we must be creative, disciplined, focused and think long term. There are two ways that we can do a disservice to our residents. We can budget too much and impose unnecessary costs when many families are having difficulty making ends meet. Or we can budget too little, cut back on necessary services when many residents need them most, and let our infrastructure deteriorate to a level that makes economic recovery more difficult and protracted. I believe that this budget strikes the right balance between reducing costs and maintaining important services.

The 2015 County Budget that I present to you today is $201,201,720.56. Our Amount to be Raised by Taxation is $160,746,006. Over the past three years we have budgeted approximately $9.6 million less than allowable under the state budget cap. This year we are more than $2.6 million below the state cap. Based on the best information we currently have available, we conservatively predict the County equalized General Purpose Tax Rate will be .40, less than two tenths of a cent more than last year. To keep the rate in perspective, it is lower than the 44 cents rate when I first assumed office in 2000. As has been our policy, we have allocated 50% of our surplus into this year's budget. The total tax rate for the county which includes all four county taxing districts will be down 1.4 cents.

The increase in the amount to be raised by taxation results from the arbitrated settlement of public safety contracts for Prosecutor detectives and Correction Officers, as well as a negotiated settlement with our Sheriff Officers. Public Safety is the largest and most costly portion of the county budget. Our total increase in salary and other expenses is $2,095,246. Of that amount, $1,923,926, 91.8%, is directly related to those public safety settlements. Obviously, this settlement added significantly to our health benefit costs which are up $467,572.

Our state mandated costs also increased, Maintenance of patients in psychiatric institutions is up $479,999. Currently there are more than 46,000 individuals in Atlantic County receiving food stamp benefits from the Supplemental Nutrition Assistance Program better known as Food Stamps. The increase in caseloads overwhelmed our existing staff and we, along with 8 other counties, were not able to meet the state's mandatory time frames to determine eligibility. As a result we were required to add 10 positions to our Department of Family and Community Development. The increase to the county is $284,645.

Our Assessed Valuation has gone from $58.2 billion in 2008 to $39.8 billion in value in 2015, a decrease of $18.4 billion. In 2013 and 2014 combined we dropped $7,317,117,453. In 2015, we expect a further erosion of Atlantic City's tax base.

The need to stabilize Atlantic City's property tax base is imperative. It is unfortunate that when the county attempted to intervene in a casino property tax appeal a few years ago, the Judge ruled that we did not have standing and therefore have no say in how these tax appeals were handled. I believe that we could have played a significant role in stabilizing Atlantic City's property tax base if we had been allowed to participate.

There are other corrective measures that can be taken. I urge the state legislature to pass the "Casino Property Taxation Stabilization ACT," otherwise known as a PILOT. Mayor Guardian and I reached agreement and clarified what the county share of the PILOT will be and all Atlantic County property tax payers will be better off with the PILOT than without it. I also urge the legislature to approve countywide tax assessment. This will eliminate the structural inequities in the current system that allows some property taxpayers to pay more than their fair share and others to pay less.

Over the years we have adjusted our budgets accordingly to compensate for declining property tax values. We have eliminated or frozen approximately 122 positions. We imposed two years of voluntary or mandatory furloughs. We have privatized several programs such as the Youth Shelter, Jail Social Services, Senior Citizen Case Management, and the Medical Examiner. In 2015 we also plan reductions in the hours and days of services at our libraries and other facilities in an effort to reduce expenses.

Reducing costs and finding efficiencies is an ongoing effort. We will continue to work to find new, less expensive ways to do things and to take advantage of new technologies and services as they emerge.

We will continue to outsource programs when we think that savings will result. In 2015 Atlantic County will join nine other counties in a Joint Insurance Fund (JIF). Our commitment is for a period of three years, which will give the county an opportunity to determine if the JIF affords us significant savings in our insurance requirements. As a result of this decision, we will no longer do our own claims adjusting. This will eliminate five positions from the budget.

Conversely, we will bring services in house when it proves less costly. In the past, we have used an outside contractor to manage and monitor outside medical services that inmates receive at the county jail in a hospital setting. We have determined that this can be done in house on a less costly basis.

We are in the process of negotiating a shared service agreement with Cape May County for a K-9 training academy starting in 2015. Cape May will pay one half of the salary and benefits of the K-9 trainer and all their dog handlers will be trained free of charge. Any revenue generated by the academy will go to offset the cost to operate the facilities in Corbin City. If there are revenues that accrue after all expenses, the two counties will share that sum.

To increase revenues at our Meadowview Nursing Home, in October of 2013 we dedicated thirty beds to form a rehabilitation center. This effort proved successful and after one year of operation, revenues to Meadowview increased $500,000.

Looking ahead, 2015 will be a pivotal year for Atlantic County. Despite the challenges we confront, the good news is that we are not without opportunities. What we need is the collective will and determination to optimize these opportunities. To capitalize on these opportunities I have appointed the Atlantic County Improvement Authority as the lead agency for economic development in Atlantic County. Traditionally, state public authorities such as the CRDA and the SJTA have played a broad economic development role but this is no longer the case as they no longer have the funds or legislative mandate for this. The ACIA has broad statutory redevelopment powers, demonstrated experience and an established working relationship with all 23 Atlantic County municipalities, not just Atlantic City.

As a first step, the ACIA has retained the nationally recognized firm of AngelouEconomics to create an economic development strategy and action plan for Atlantic County. Their work is underway.

The overriding goal of this initiative is to broaden and diversify Atlantic County's economic base in order to attract and create good jobs with good pay. It will build upon local economic development assets such as the FAA William J. Hughes Tech Center, Richard Stockton College, and major medical facilities. This will reflect a totally different approach to economic development, one that emphasizes collaboration, coordination, partnerships and a regional perspective. There will be a strong public participation component that is vital to its success. We must create a common vision of what we want Atlantic County to become and get the commitment from our business and community leadership to make it happen. I look forward to working with all of you as this project advances.

The need to help people who have lost their jobs get back to work is our top priority. Our Workforce Investment Board, working in partnership with the Greater Atlantic City Chamber, has developed a pilot program to get dislocated workers back to work. In addition, the state received a National Employment Grant that will target dislocated workers here in Atlantic County through our Workforce Investment Board.

I am pleased to report that we have made progress on another important initiative. In partnership with Richard Stockton College we began the initial design work for a central dispatch/central communications facility. This project has been a key priority of both county administration and this Board of Freeholders. It was only able to move forward because of this cooperation. The center will be constructed on Stockton property. We anticipate that construction will be able to begin in late 2015 or early 2016.

In conclusion, county government remains in stable financial shape. This was affirmed this past December by Moody's Investor Services who reviewed and retained Atlantic County's Aa2 bond rating despite these trying economic times. In their ratings update, they specifically cited the county's strong financial management team, financial planning and prudent debt and finance policies. Our fifteen perfect annual audits, stable tax rates and low debt ratio attest to the soundness of our fiscal policies and the quality and experience of our financial staff. It also attests to the cooperation and oversight we receive from this Board of Freeholders. I would also like to thank Jerry Del Rosso, Diana Rutala, Bonnie Lindaw and Jeff Monroe, all of whom worked tirelessly on this budget.

All of you help to make Atlantic County a better place. You have my sincere gratitude and appreciation. Thank you.