SPOTSWOOD, NJ — Spotswood moved closer to adopting its long-delayed 2026 municipal budget Monday after state officials authorized the borough to proceed with a budget amendment that addresses several financial issues, including employee sick and vacation payouts and a special-emergency appropriation.
Business Administrator Frederick Carr told the Borough Council at its Sept. 21 meeting that the borough received authorization from the state at about 3 p.m. that afternoon to move forward with the amendment.
The borough has been operating on emergency temporary appropriations while its budget remains under state review. Carr said another emergency temporary appropriation on Monday's agenda was still necessary because the amended budget had not yet been finally adopted.
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"We still have on tonight's agenda a temporary emergency to pay the bills" until the council passes the budget, Carr said. He said the latest temporary funding should allow the borough to operate through the remainder of October while officials complete the budget process, obtain tax-rate certification and prepare tax bills.
Municipal financial consultant Gerard Stankiewicz later walked council members through some of the changes required in the amendment.
One involves approximately $164,000 connected to sick and vacation payouts for borough employees. Stankiewicz said officials initially believed the amount could be raised over five years through a special emergency. However, he said that approach was not allowable because the affected employees had not retired.
As a result, the approximately $164,000 had to be addressed as an expenditure without an appropriation and raised through the amended budget.
The amendment also addresses a separate $285,000 special-emergency appropriation. Stankiewicz said the state required that amount to be reflected in the 2026 budget.
A $250,000 payment from the borough's cyber insurance helps offset that amount, he said. Additional surplus is also being used to absorb the budget changes without increasing the amount the borough plans to raise through taxation.
Stankiewicz said the changes were structured to maintain the council's previously established tax target of approximately $150 for the average residential unit.
Mayor Rich O'Brien asked Stankiewicz directly whether the amendment affected the tax levy.
"The amount we raised by taxation that we started with back in June is the same because there's no impact on taxes in this amendment here," Stankiewicz said.
The discussion also returned to money recovered through the borough's cyber insurance.
Councilwoman Dawn Schwartz questioned whether the $250,000 insurance payment would remain reserved for repayment of borrowing associated with the borough's cyber-theft-related financial obligations. Schwartz said council members had previously been told that insurance recoveries would be set aside for that purpose.
Stankiewicz said the money would be placed into the appropriate reserve and could not be redirected from that obligation.
O'Brien said the borough had already committed the money toward a payment due in May 2027.
"We are dedicating every dollar, dollar for dollar, to that May 2027 payment," O'Brien said.
The mayor said borough officials had questioned why the state wanted the money incorporated into the 2026 budget when it had already been reserved for a 2027 payment, but ultimately the borough needed to comply with the state's requirement to move the budget forward.
"It doesn't impact the taxes," O'Brien said. "We are gonna pay it back in May just like we said we would."
Because Spotswood's original budget was under state review, Stankiewicz explained, amendments also required state approval before the borough could proceed. The amendment must now be advertised and go through a public hearing before the budget can be finalized.
That process has delayed the issuance of final tax bills.
Stankiewicz said the borough needs to complete the budget process so tax bills can be issued. Carr said the temporary appropriations approved Monday were intended to carry borough operations through the remainder of October while officials work through adoption, state certification of the tax rate, and preparation of the bills.
Officials did not give a specific date for when residents should expect the tax bills to be mailed.
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