West Windsor CFO outlines small tax increase as fund balance falls, urges adoption of capital ordinance

The West Windsor Township Council received a detailed budget preview on Feb. 27 as Chief Financial Officer John Waters outlined revenue assumptions, a decline in reserves and a narrowly targeted tax increase to stabilize finances.

Waters said the township is increasing anticipated interest income by $500,000 — from $900,000 to $1.4 million — after unexpectedly strong investment returns. He also reported modest increases in sewer revenue and a $224,000 addition to the capital fund balance tied to premium proceeds on short-term notes.

"We're increasing the anticipation of interest on investment and deposits by 500,000," Waters said, adding that the prior budget had projected $900,000. He cautioned the figure is an estimate. The CFO reported the net effect of revenues and planned appropriations will reduce unreserved fund balance to roughly $8.3 million in 2026, down about $1.6 million from the prior year.

The projected "amount to be raised" in property taxes rises by about $2.2 million, a change Waters said equates to a roughly 3.4¢ shift in the rate and about $14.80 annually for a median household. "It is our first tax increase in 5 years," Waters said, linking the change primarily to higher health-care and wage costs.

Mayor (Speaker 2) and other council members emphasized the township's conservative accounting practices and the desire to avoid returning to very low reserve levels. Waters said rating agencies generally prefer reserves near 18 percent and explained the township also maintains other reserve accounts and targeted set-asides for tax appeals.

Waters warned that a separate capital (COLA) ordinance must be adopted before the budget is introduced to preserve two-year carryover authority for capital items. "I need four votes for this ordinance or it doesn't pass," he told the council; without adoption, he said the budget could not be introduced and the township would need to rework its plan.

The CFO also noted an informal negotiated payment agreement with Princeton University for nonexempt properties; Waters said details remain under negotiation and that specific terms will be discussed in a closed session.

Next steps: the council will receive the finalized memo and capital ordinance language ahead of an April meeting and expects to consider the formal budget introduction at an upcoming session. Waters said staff can bring supplemental ordinances or bond ordinances later in the year if the council decides to add funds for specific projects.