No general can carry out a campaign, no matter how carefully planned, unless he has at his disposal the necessary sinews of war. The most brilliant military strategy is useless unless there are men and guns available to carry it out. So it is with the Teaneck Plan. The "sinews of war" in this case are the finances required to put into actual effect the physical developments which are proposed. The Planning Board has therefore given this side of the picture its careful attention and offers a mode of procedure which it believes well adapted to all prevailing and anticipated conditions.
Before going into the details of the suggestion it might be well to point out that the Plan as it stands is a carefully thought out, educated prediction as to what will take place in Teaneck within the next twenty years. It is relatively accurate for the first five years, but is at all times subject to revision to meet changed physical and financial conditions. If the Plan could be executed in its entirety today or if it were possible to see into the future, the entire cost could be estimated within about twenty per cent. Both of these are obviously impossible, however, and the Board therefore presents its conclusions on this point also. The figure is an important one and it is felt that it is better to assume than to do nothing about it.
Another factor to be considered is the vital importance of giving the Plan an immediate start so that future administrations need only carry on along lines already laid down. A program such as that which is suggested will carry on by its own momentum and there should be no occasion for wide deviations therefrom, no matter what circumstances may arise. The urgency of an immediate beginning by the present Township Council is probably more important than the actual program finally decided upon.
One of the major considerations of the financial program is the spreading of the cost over a period of years, and how and to what extent purchases of property can best be made. Present conditions restrict us to purchases where owners will accept bonds. The question of the term of these bonds and the extent to which properties should be acquired each year are therefore important questions also. On the other hand, some purchases will require cash and it must be decided whether any part should be raised by budget appropriation or by the issuance and sale of bonds only.
In the absence of any other financial plan the Board is therefore recommending to the Council the issuance of $25,000 worth of ten-year bonds for the purchase of the most important piece of property in 1933, which may probably be bought very advantageously in the present real estate market. This action would give the physical plan its real beginning.
The figure of $25,000 was arrived at by taking 2 1/2 per cent of the values of new construction in the Township in 1932. Since the present basis of assessing property for taxing purposes in Teaneck is about one-third of actual value, this is about 7 1/2 per cent of the increase in ratables due to new construction. If this program were continued each year, using the building figures of the previous year, the Plan would then be effectuated almost simultaneously with the attainment of the growth upon which it is based.
The Board's theory in suggesting this program is that a certain sum may logically be spent for general Township betterment as the population increases. On the other hand, there are certain permanent improvements now existing which new residents will enjoy but for which they will assume no part of the burden of the cost. In no other way than that proposed could these newcomers be taxed for the improvements which they will enjoy in proportion to the load borne by present taxpayers who have a large capital investment in the community at the present time.
To those who point out that the ratio of gross debt to the total ratables is the criterion of those who purchase bonds and that for this reason the gross debt should be cut down rather than increased, the Board wishes to give certain figures. The present gross debt amounts to 25.51 per cent of the assessed valuation. The proposed increase in bonded indebtedness would be 7 1/2 per cent of the increase in ratables due to new construction. It is obvious, therefore, that the small sum suggested annually would not increase the present ratio, since even if bonds were issued in an amount equal to 25 per cent of the new ratables and the existing debt not cut down, the present ratio would merely remain stationary.
It should be noted, also, that investment in well planned capital improvements would eventually be reflected in the Township's credit standing in any event. The existence of such improvements would almost certainly have a favorable effect in the minds of those who might purchase bonds in the future.
It is possible that other factors than the value of new buildings should be considered in this connection. Increased ratables, population, local improvements, or any combination of these may have an important bearing on the financial program finally adopted. Another plan might be to establish a fixed amount each year, plus a percentage of one or more of the above factors.
As a practical example of how this might be accomplished the reader is referred to the schedule included herein of properties to be acquired for other than street purposes. The present value of all of the sites, enumerated is about $400,000, but it is estimated that in 1952 the same property may be worth $1,000,000. This means an average value if purchased in regular amounts during the whole period of approximately $700,000.
This might be met by beginning in 1933 with the same sum as that suggested in the Board's first program, namely $25,000. This might then be increased 10 per cent annually until the sum of $50,000 was reached in 1952. Such a program would mean an average annual expenditure of $37,500, or a total expenditure of $750,000 over the twenty-year period.
Still a third method would be appropriations based upon population increase and, therefore, upon the increase in wealth. This would produce results similar to the other plan, but in a somewhat more irregular fashion.
It has also been suggested that certain properties which have been foreclosed for unpaid taxes might be substituted for the park and playground sites recommended in the Plan. The Board, if given complete data on these properties, might amend the Plan along those lines. This could be done, however, only if the new sites were considered economical from every standpoint.
So far only those parts of the Plan requiring the purchase of land have been considered. Expenditures for other important items will be necessary and these have been outlined below, together with suggestions for financing them:
1. Bridges or overpasses. Some of these can be considered aside from any Planning Board program and more in the nature of County or State road improvements.
2. Improvement of parks, playgrounds, and lands obtained for rights-of-way for through streets, etc. These could be taken up for independent action by the Township Council as desirable, possibly after a referendum vote on the expense or, if not too extensive, by budget appropriations under "Parks and Playgrounds."
3. Loss of ratables due to purchases of property by the Township. This will be at the most only from one-third to one-half of the purchase price. Furthermore, it is entirely possible that the capital investments will have a great indirect effect on ratables throughout the community and largely offset losses incurred by taking out of ratables the properties purchased by the Township.
4. Future school sites and facilities. The Board of Education evidently desires to act independently on this matter and it has therefore been left out of the Planning Board's considerations.
These are the suggestions of the Board as to the best way in which to finance the Plan and they are the result of careful study and consideration. It is entirely possible, of course, that the Township Council may choose to modify them or to replace them by some other program better suited to the circumstances which may arise, but whatever program is finally decided upon, it is the primary contention of the Board that a portion of the new wealth which will come to the Township should be dedicated to the fulfillment of the Teaneck Plan.