I, along with many others, read with great joy and delight an article on patch.com from Oct. 13, “Lawrence [is] To Receive $575K In Coronavirus Funding From NJ.” It is amazing news, if it were true. But it is not.
So, now I have to write an article because posts on social media from residents have expressed great interest in how the township will be spending this windfall of money that we are not receiving. To give you the answer now (and save you from having to read the Patch article), $575,000 is the maximum amount Lawrence Township is eligible to receive as reimbursement for qualifying expenditures. That saying, the “devil is in the details” seems to come to mind.
The New Jersey’s CARES Act Coronavirus Relief Fund is a fund purposed to provide counties and municipalities severely impacted by the pandemic with financial assistance “to maintain essential services and take the steps necessary to fight COVID-19.” The most significant negative financial impacts result from “extreme economic contraction, deficits in tax and fee revenues, and extraordinary increases in public safety and health and human services expenditures.”
In Lawrence, we can identify and relate to losses sustained from all of these categories. We have lost millions in revenue from taxes (predominantly commercial rateables), as well as hundreds of thousands of dollars from construction fees, recreation fees and court revenue, to name a few. But these costs are not what the CRF Funds are to replace. These are not qualifying expenditures (i.e., what the township may claim as “permissible” expenses related to our COVID-19 response).
To be very clear, the proceeds from this grant will reimburse counties and municipalities for money spent on COVID-19 costs; money that was not included in 2020 budgets. Therefore, there should be no question where those proceeds, if received, will be applied. But if you need to ask the question, the answer is that it will be applied to the budgetary funds that have been depleted due to the pandemic. It is not extra money to be spent anywhere a governing body wishes.
At present, we do have qualifying COVID-19 related costs: (1) additional salary and wages; (2) additional equipment (PPE, etc.); and (3) other miscellaneous costs; the total of which through Oct. 14 is approximately $88,000. But we, as a township, are aggressive in pursuing grant funding in all that we do because grant proceeds reduce taxpayer costs. Through FEMA and other New Jersey grant sources, we have applied for and will most likely receive money to cover these costs. (We have already received some.) In addition, prior to passing our 2020 municipal budget, we understood that the pandemic would result in additional costs to our operating expenses and included $135,000 into the budget so that 2021 would not have to absorb it all.
Accordingly, our township is well situated to handle what 2020 brings us. This pandemic, however, persists with no real end in sight. As a result, 2021 will have to be provided for.
Knowing that there is federal and state assistance available to us for these expenses is certainly helpful. However, the loss of anticipated tax revenue and revenue from the other sources that fund our municipal budget continue to accrue and will have to be dealt with responsibly.
The resident taxpayers in our community need to know, understand and believe that the governing body and the professionals that manage our community finances will pursue every available grant to limit our losses, and do what is necessary to protect our ability to provide the services we all need, expect and deserve from our taxes.
Over the years, many in the community questioned the amount we hold in our surplus fund as being too much and applied pressure for us to use it for one reason or another. Despite all of the fiscally prudent reasons to have a healthy surplus fund (i.e., better financing rates and higher returns on investments), the one that stands out right now is that it can be used for a “rainy day.”
Our “rainy day” has arrived, and its name is “COVID-19.”
Kevin Nerwinski, a longtime resident of Lawrence, serves as Lawrence Township’s municipal manager.