Rate Increase? Let's Pump the Brakes
By now, many Belleville Water Customers have received their most recent water bill. Whether you are a residential or commercial customer, that bill reflects a recent increase to our water rates. Several Council Meetings ago, after consideration and at the urging of our financial professionals, the Mayor/Council voted unanimously to increase water rates. As the first round of commercial water bills were issued, I wrote a letter of explanation, which can be found on my Mayor’s website, www.MelhamforBelleville.com. That letter explains and justifies exactly why we were forced to make this difficult decision.
By way of background... Most know at this point that Belleville has a contract to purchase our water from the City of Newark. While Newark’s sale rate to Belleville often ticks up gradually, for some reason Belleville had not raised rates since 2012. In my opinion, this inaction was a major disservice to the public. This lack of oversight and management left Belleville’s Water Utility running a deficit for years. Next, we have been out of contract with the City of Newark since 2016. I have no idea why the prior Administration let it lapse, but the end result is a huge outstanding balance. Why? Basically, the Township has been paying the 2016 rate for the past four years. While my administration has been working on the renewal, in order to bring the contract current, we must pay the City of Newark $1.6Million, representing the four year difference from the 2016 rate to the 2020 rate.
Back to the here and now. I stand 100% behind the facts and figures contained in my rate increase letter, however, after several meetings in Town Hall last week, I now question the data our professionals used to calculate the new increase and the estimated projected revenue it would generate. I do not believe our financial team had all the data needed, or for that matter, the correct data needed to make the recommendation on the amount of rate increase for Council consideration. In addition, we increased commercial rates by 300%, but at no point, did we even know how many commercial properties we have. Therefore, how can we in good conscious anticipate the revenue???
Again, while I understand why we need to raise the rates, I have lost faith that the analysis performed to strike the new, higher rates, was performed correctly.
In my opinion, the new rates, correctly separate residential and commercial. After all, must utilities, including PSEG charge different rates for residential and commercial customers. The problem as I see it is that our new rates were merely backed into in an attempt to meet both our outstanding $1.6M obligation to Newark and to, at a minimum, cover the cost of the current rate the City of Newark charges the Township.
Here’s the good news. I believe the Township’s financial professionals drastically underestimated the number of commercial properties within the Township. And since Commercial properties pay more for water, as they often use our water to generate a profit unlike residential users, if you have 6, 8 or 10x’s more commercial users than originally expected, you will generate that multiple in extra, additional projected revenue. This means, the new rate recently struck by the Council, can and should now be reconsidered and reduced.
To that end, I plan on putting for a resolution on the next Council Meeting directing the Manager to revisit how the increases were calculated to determine if they needed to be raised as high as they were raised. I for one, have seen enough data to concluded they can be lowered. As Water Bills come out, I plan on paying mine, with the hopes of eventually seeing a credit on a future bill.
Water Rates Message from Mayor Melham
Dear Belleville Water Purchaser:
Since taking office in July, 2018, the Council and I have steadily been working to cure some of the long term problems that have plagued Belleville. I’m happy to report that collectively, we have made a lot of progress. Some of that progress has included hiring a full-time CFO, which we haven’t had for years, and for the first time in decades, a full-time, outside, professional Township Manager. Some may think these two positions would be staples in a Township the size of Belleville, but for many years, they were not. Because of our decisions the Township now has a professional team ‘watching the store.’
Which leads me to this quarter’s Water Bill. Recently the Township Council voted to increase water fees. Why? Because as you may or may not know, Belleville has a contract to purchase water from the City of Newark. That contract, which has been expired since 2015 gradually ticks up the rate the City of Newark charges Belleville. The problem was, Belleville, had not changed our water fees since 2012, which left our Water Utility running a deficit year after year. Clearly a private business buying a product for X and reselling would never be sustainable if and when the cost to purchase the product far surpasses the fee you resell it for. Well, this is exactly what has happened over the past six years.
Furthermore, while the Township has run a loss, for six years, meaning we pay the City of Newark more than what we collect in water bills, we have also been out of contract for many years. This means, that we currently owe and have already begun to pay back the City of Newark $1.6M in back water payments.
In 2.5 years, we have accomplished a lot. However, we are still tackling several issues from the past. Thankfully, I am confident in the team we have in place. I believe collectively my Council colleagues and I are righting the ship and providing a good, solid foundation for Belleville to move forward.
Michael A. Melham, Mayor
Township of Belleville
Sessa's Corner: Putting the Mayor on the Hot Seat!
The measure of a man is not necessarily his title or his position, but rather how he treats others. - Victor L. Brown
Now that I have obtained the complete email thread, it is posted below. I must plead with anyone who has already viewed the entire thread on Mr. Sheldon's FB page to delete the file and not share. Mr. Sheldon more than likely broke another law by publishing privileged content. The email thread linked below is a file which contains redactions provided by the District.
I remain shocked that this man would receive the endorsement of the Belleville Teacher's Union, who have already paid for a mailer and his lawn signs. Perhaps, they will reconsider.
On Tuesday, March 26 2019, rather than giving my traditional 'Mayor's Report,' I opted instead to give some prepared remarks. Since we had two financial agreements on the agenda regarding PILOTs, Payments in Lieu of Taxes, my remarks centered around a PILOT explanation, all the positive benefits for Belleville, the additional revenue and how little they actually impact that School District. I believe the applause at the end, is indicative of the silent majority in Belleville finally stepping forward to be heard. If you're concerned or curious, I highly recommend taking the time to listen.
Belleville's 'After-Hours Lecture in the Conservatory'
Last week, the Council took the first in a series of steps needed toward creating what you can think of as an energy buying co-op for our residents. The group buying aspect is precisely what separates this program from the people who walk around ringing our doorbells, and trying to get you to switch providers. That IS NOT this program, AT ALL.
In short, if we bundle our residential energy buyers, this gives us group buying power. We then attend a reverse auction, whereby the current PSE&G rate is the starting point, and energy suppliers bid down from there. This is precisely why the rate will never be more than PSE&Gs. If the bid rate is lower than PSE&G’s, we lock it in. Which is precisely why you will NEVER be charged more than PSE&G’s rate. PSE&G and the Board of Public Utilities (BPU) endorse this practice for bulk buyers of energy. Up until recently, you had NO choice in energy providers, now you do. Taking advantage of that freedom is what allows the municipality to create this program. Understand, the municipality also selects cable providers, like Fios and Comcast, whereby, other towns like Nutley do not have Comcast, rather they have Cablevision.
Before I explain the program in more detail, please know the following:
- The Township makes no money from this, nothing at all.
- At this point, nothing has changed
- We only voted to create the program
- Extensive marketing and educational materials will follow
- Multiple public forums will be offered
- Residents who don’t fully understand the program, or do not want to participate in the savings, can opt out. Those who opt out, can opt back in at any time.
Most importantly, after the auction, if the price doesn’t represent a savings, we do not move forward. Period. End of story.
Again, we only took the first step. There is a fairly lengthy process still ahead. In order for this program to yield a savings for our residents, we need to include as many potential customers as possible. We basically get a savings because of our group buying power. That’s why I often relate this to a co-op. Please know, it is IMPOSSIBLE for your rate to increase. We will only continue after the auction, if the auction price for electric is lower than what PSE&G charges. And again, you will be afforded every opportunity to opt-out when the time comes. With the exception of one line, your bill will not change. Nobody else will bill you. Most residents won’t even know there’s been a change.
- You will still get one bill from PSE&G
- You will continue to call PSE&G for customer service
- You will continue to have PSE&G come out for service calls
Many other towns are enjoying this benefit. I’ve included a letter from the Mayor of Linden, who recently renewed the program on behalf of his residents, as well as a basic information sheet. Also, a letter and information sheet from Cinnaminson. Some have been circulating a recent press release from Bloomfield. I URGE you all to read it thoroughly. It validates exactly how safe this program is. Bloomfield received a rate which saved their residents $700,000 since the program’s inception. As they went out for a renewal bid, the rate they could lock in wasn’t cheaper. Therefore, all customers reverted back to PSE&G. The customers did nothing and most probably didn’t even know they went back. In March/April, Bloomfield will be going back out to auction in the hopes of locking in a cheaper rate to continue the cost savings.
- We go to an auction and receive a fixed price, which MUST be lower than the current rate.
- It's that simple
- It's NOT the equivalent of the people who come around ringing doorbells.
PLEASE KNOW – We cannot explain and market a program BEFORE we create it. In this case, I was comfortable creating it first, as initially it obligates NO ONE. We WILL MARKET the program and hold several PUBLIC FORUMS. At that time, you can opt out. We will then go to auction and ONLY move forward if we can lock in a GUARENTEED cost savings. If we cannot, NOTHING HAPPENS. The program will NEVER take effect.
Lastly, I urge you all to PLEASE vet the information you read online and question the sources. I only ask that you question them as much as you question me. Fair enough? Understand these people ARE NOT HAPPY with the change and progress we are making.
They are trying to capitalize on your perceived ignorance. Please do not allow them to perpetuate the same negativity, and divide and conquer techniques, that has seemingly held back our great Township for more than a decade.
Current Status of Illegal Mailer Lawsuit
April 2019, UPDATE
We have reached an out of court settlements with Mr. Raymond Kimble for an undisclosed financial amount. The below information has been in the public domain since before we knew the identities of the involved individuals. All below information remains as is, untouched since April, 2019.
Immediately following the election, as promised, I filed a complaint with New Jersey’s Election Law Enforcement Commission (ELEC) regarding the various illegal mailers that were sent during the campaign. Those mailers not only attacked my team, but other candidates as well. At that time, it was unknown who the perpetrators were.
Soon thereafter, we had an attorney file a complaint in Essex County Superior Court against ‘John Doe,’ ‘Jane Doe’ and various fictitious corporations. Doing this gave us subpoena power to compel the mail house, which produced and mailed the illegal mailers, to turn over the identities of the responsibile individuals.
After our subpoena was filed, we were granted subpoena power. A subpoena was eventually served on the mail house compelling them to turn over documents pertaining to the illegal mailers.
The mail house complied with the subpoena and turned over all documents relating to the illegal mailers. It was at this point, we finally learned that the mailers were prepared, organized and supplied to the mail house by a Township employee who is also an elected member of the Belleville Board of Education. We also learned that the illegal mailers were paid for by Mayor Kimble’s campaign account.
At that time, I then sent a second letter to ELEC and provided the evidence we received from the mail house. While I asked them to pursue the perpetrators, I clearly appealed to them, for various reasons, not to pursue the Mayor nor his Treasurer.
We eventually filed a second subpoena with the mail house. This time we asked them for any digital data. By this time, we knew who the main facilitator was and who paid for the illegal mailers, but we didn’t know who designed them. While we still haven’t turned up the designer, we did find out who supplied the mailing list that was used for the mailers. The name that appeared was, at the time, a municipal vendor who is also a current elected official with the Belleville Board of Education.
Armed with concrete, irrefutable evidence, our attorney filed complaints against all parties involved. I promised we would hold those responsible accountable and that is what we are doing! My hope is that this finally ends the nasty electioneering that happens in the weeks leading up to a local election. If you have something to say, follow the law and disclose your name and who paid for your mailing.