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Schneck On Debt

The Star asked each candidate a question about Belmar’s debt and ran the responses in yesterday’s edition.  Because of what they described as a technical problem, the way the answers were paragraphed was lost so each answer was one 400-word long paragraph.

I think that’s inexcusable.  We put a lot of work into our answers and so much meaning is lost when its not presented in separate thoughts like the authors intended.  They could have at least told us in advance, since they did know about it.  Very bad, Coast Star!

Anyway, for those who don’t get the Star, or if you’d like to read my answer presented in a way that makes sense, here is the question and my answer with the paragraphs left intact.  If it seems to be a little choppy, its because I had to be very economical with words to stay within the strict 400-word limit.

Q. Belmar has incurred about $57.7 million in municipal debt — $43 million of which was incurred since Sandy. Of that $43 million, $36.2 million was for Sandy related costs and $6.76 million was not Sandy related and was for water/sewer projects. That will be paid for by the water/sewer utility. Since Sandy, the borough has been able to pay down almost $4 million— $3.1 million of which was for Sandy-related costs— leaving about $39 million in debt since the storm. Of the remaining $33.1 million in Sandy-related costs, up to 90 percent is expected to be reimbursed by FEMA. Do you think the $36.2 million spent for Sandy recovery was justified? Or do you believe the borough’s recovery goals could have been accomplished in a more fiscally conservative manner? And do you believe the borough will be able to pay down, through grants, insurance, low-interest loans or taxes, the millions that could be left unpaid once all expended money has been reimbursed?

A. To understand Belmar’s current debt situation, you should know where it came from, and which parts are going to be paid in what manner.  My understanding, using figures deemed accurate by a Belmar official, is that our pre-Sandy total debt was $18.5million and now is $48.25million if FEMA pays all our claims.  (Belmar is one of only three towns whose bills are reported as undergoing FEMA audit.)

 Here is a brief overview of what has happened since Sandy:

The school debt dipped from $3.5million to $3million.

The water utility debt climbed from $3.5million to $11million.  That increase wasn’t Sandy-related.

The beach utility debt went from zero to nearly $30million.  If FEMA pays it’s $14million claim, the debt will be $15.5million.

The municipal portion of the debt, including marina debt, rose from $11.5million to $19million.  That’s if we get the whole $3mil for that portion of our FEMA submissions.

So that’s where we are.  We’re not getting $30million from FEMA as the question presumes.  Our claims total only $17million and even they’re being audited.

Hopefully the water and beach utilities can service their debts but if not, we pay.  The $19million municipal debt, minus whatever the not-very-profitable marina can pay, is all ours.  We own it.  All the money has been spent, so we can’t undo any of it like Manasquan did with their debt (which was significantly less than ours to begin with.)

 Could we have spent less?  Yes, a lot less.

Thinking that FEMA would happily pay any bill, this administration behaved like spoiled children in a toy store.  We allowed AshBritt to overcharge us by millions in no-bid contracts.  We spent over a million dollars at the Chevy dealer, buying new trucks for public works and replacing our Crown Victoria police cruisers with Tahoe SUVs @$90,000 ea.  There were seemingly endless spending abuses and I don’t believe anyone down there ever said no to anything.  I’ve read every payment-of-bills list since the storm and was appalled at how little regard they had for the taxpayers, no matter which taxpayers they thought ultimately would be paying for all this.

To answer the final questions: Any grants will be in the thousands, not millions.  The insurance, I believe, has been used already.  You can’t pay down debt by borrowing more.  Taxes are already too high.  So I would suggest we practice some spending discipline and significantly cut our $15million budget.


BTW, if any of the other three candidates wants me to post their answers with the paragraphs still in place, email me the Word file and I’ll put them up over the weekend.  And I promise I  won’t pick them apart.

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