Municipal Finance 101
Remember when your high school schoolteacher said that math is a useful skill to have in life?
Your teacher was right.
The fact is, Borough officials need to understand the complexities of municipal budgeting and its practices that are key in managing day-to-day operations, in planning, in dealing with unforeseen costs, in balancing tax income with cash flow, and so on.
A municipality’s debt will almost always exceed surplus, just as mortgage principal typically exceeds a family’s savings account balance. Based on Ramsey’s strong municipal finance position, the Borough has been able to take advantage of favorable interest rates and leverage certain financial instruments, such as Bond Anticipation Notes, to its advantage.
Leveraging municipal bonds is a common and effective strategy that municipalities use to finance necessary projects and services without imposing significant immediate tax burdens on residents. In other words, if you don’t issue debt and install pay-as-you-go to make borough improvements, you would drastically raise taxes immediately for projects, many of which benefit generations of residents for many years to come.
In addition, year after year, we regularly apply for and receive grants that help to mitigate specific costs.
Ramsey’s ranks in the lowest tier of municipal tax rates in Bergen County with the 12th lowest of 70 municipalities municipal tax rate and the 7th lowest share of tax dollars going to municipal services in 2023.
With the annual municipal tax rates and debt levels among the lowest in NW Bergen County, Ramsey has accomplished its goals over the last decade without disrupting the functions that serve the community and without overburdening taxpayers, positioning itself for what lies ahead.