Chart depicting Upper Gwynedd’s capital reserve fund balance from 2022 through 2025, as presented during the Nov. 12, 2024 township commissioners meeting. (Image courtesy of Upper Gwynedd Township)
Manager says township will tap reserves to tackle capital projects
2025 looks likely to bring plenty of projects, but no new costs for residents, in Upper Gwynedd.
Township officials gave a preview of their 2025 budget requests this month, voting ahead the budget and tax rate.
“We currently have a balanced budget, with no tax or rate increase proposed for 2025,” said township Manager Sandra Brookley Zadell.
In late 2023 the commissioners approved a $17.8 million 2024 budget with the township’s first sewer rate hike since 2017, and no tax increase for that year. The township’s real estate tax millage level currently ranks 13th-lowest, “on the lower end of the spectrum” among municipalities in the county, with the 2024 budget tracking to produce a total projected revenues of $14.9 million, and an expected year-end surplus of roughly $653,000.
The township’s largest expense in 2024 has been for public works-related projects, including infrastructure upgrades at the town’s wastewater treatment plant, and inflow and infiltration work to upgrade utility lines throughout the township, according to the manager.
Police services in 2024 are projected to total roughly $4.6 million, largely for salaries and benefits, with wastewater treatment plant revenues projected at $5.2 million and expenditures of $7.4 million, which includes $1 million in anticipated depreciation — “and with that removed, the sewer fund has a net cash increase of zero,” Zadell said.
General fund reserves are recommended to be roughly $2 million, or the equivalent of three months of township expenses, and Zadell said the current reserve balance of over $16 million could drop in 2025 by transferring some of those reserves elsewhere.
“Right now, we are overly weighted in our savings account, and we need to transfer additional money to our capital improvement plan. That’s where all of our large projects are. So you’ll see a larger than typical increase in the coming year: we’re recommending a $4.1 million transfer from the general fund reserve balance, to help plan a myriad of awesome capital projects for our residents,” Zadell said.
The total projected revenue for the township in 2025 is expected to be $12.9 million, of which roughly $9 million would come from earned income, transfer, and local services taxes; another roughly $3 million is projected from property taxes, the manager said, showing a bar chart with those two categories depicted to scale against several other smaller sources of revenue including interest earnings, rents and royalties, permits and grants.
Chart depicting Upper Gwynedd’s annual operating revenues from 2023 and 2024 and projections for 2025, as presented during the Nov. 12, 2024 township commissioners meeting. (Image courtesy of Upper Gwynedd Township)“These are our two main sources of income, and this slide is illustrative because it shows, while we do have revenues in a lot of other areas, really we are dependent on our real estate” and earned income taxes, she said.
“They stay, in some cases, pretty even. (Earned income) taxes fluctuate based on the economy, based on wages and earnings, and we’re showing a little reduction in real estate taxes next year, not because there’s any big issue with the real estate market, but because there’s not that much out there for sale, not much transfers happening in the real estate market,” Zadell said.
Traffic safety unit planned
On the expense side of the budget, “they don’t fluctuate too much,” the manager told the board, with police services projected to be the largest expense item at just over $5 million, followed by public works at roughly $3 million, then roughly $1.5 million for executive costs and for benefits. Expenses are projected to include the addition of two new fulltime police officers, to create a traffic safety unit and fulfill the recommendations of a staffing study done in 2022.
“Currently, the number one complaint I receive as the township manager are complaints related to traffic: people are driving through stop signs, or if there’s too much traffic on a roadway, or people aren’t paying attention to the appropriate signs. By having a traffic safety unit, we’ll be able to pay more attention to those quality of life issues for our residents,” she said.
The 2025 budget also includes increased allocations to the North Wales Area Library and VMSC-EMS, a separate line item for financial administration that’s now separate from administrative costs, a new fulltime deputy fire marshal who will largely be tasked with apartment inspections, a new HR coordinator to oversee more than 60 township employees, and reduced costs in building and grounds as renovations to the township administration building are completed.
Another new addition: 2025 will bring a new recordkeeping style that will separate parks and recreation, debt service, and capital reserves more clearly from the general fund, and before transfers the budget is expected to yield a surplus of roughly $737,000, some of which will go toward the $4.1 million projected expense for capital projects.
The dedicated fire fund from the township will transfer $158,000 to the township’s fire company, up by $5,000 from 2024, which the manager said is largely to cover vehicle repair costs. The parks and recreation fund, now broken out from the general fund, will now more clearly track “recreation spending versus park maintenance,” Zadell said, with expenses and revenues balanced at roughly $1.5 million. For the wastewater treatment plant, the new year will likely bring a drop in interest earnings on savings, but could bring roughly $60,000 in new revenue from North Wales Borough due to higher than expected usage, and sludge hauling costs are projected to drop in 2025, with an offsetting increase in chemical supply costs anticipated.
Chart depicting Upper Gwynedd’s annual parks and recreation fund revenues and expenses from 2022 through 2024 and projections for 2025, as presented during the Nov. 12, 2024 township commissioners meeting. (Image courtesy of Upper Gwynedd Township)Capital projects
Over the next five years, township staff are recommending roughly $32 million in capital projects across all departments, with funding for those projects mixed between annual income, grants, capital and sanitary sewer reserves and more. The capital costs are now broken out from the general fund to allow for easier tracking, with $4.7 million in spending projected for 2025 up from the $3.4 million in 2024, in charts noticeably similar to those used by new finance director Brian Shapiro when he worked in neighboring Lansdale Borough. The single biggest capital expense will be a $1.9 million project to rebuild a pedestrian bridge on Sumneytown Pike, coupled with $527,000 to move an existing bridge there, plus $1.2 million in streambank upgrades near Haines Run and $1.4 million in road paving and another $404,000 in microsurfacing expected for next year.
“Those are some mutli-year projects that we expect to be happening in 2025,” she said.
Smaller capital projects also funded in the budget include a new pole barn for storage for the parks and recreation department, installation of a new basketball court at the Parkside Place complex, and a trail connection to Stony Creek Park on the township's border with Lansdale. The five-year capital plan also includes placeholder figures of $1.2 million for a new Engine 80 firetruck in 2026 and $10 million for 2028 under the fire service category for "building replacement" as the township's fire company investigates the possible construction of a new fire station.
"These are items that we need to save up for: a facility, if we have to build a new firehouse, and an engine replacement. These items are high-cost," Zadell said.
After the roughly half-hour budget presentation, Zadell then asked the board to take two formal actions on Nov. 12: to advertise the 2025 tax rate ordinance maintaining the 2024 level, and to advertise the budget itself. The only public comments came from commissioner Denise Hull, who "wanted to reiterate: the tax rate is the same as last year. Nothing is changing," and board President Katherine Carter added: "No tax hike."
One other budget-related item was subsequently approved on Nov. 19, a resolution keeping the township's homestead exemption level at $30,000, the amount taxpayers can deduct from their assessed value when calculating local taxes. Carter also announced that the board's last meeting of the year, scheduled for Dec. 16, will be cancelled: "We'll only do one in December, due to the holidays."
Upper Gwynedd's commissioners next meet at 7 p.m. on Dec. 9 at the township's administration building, 1 Parkside Place. For more information visit www.UpperGwynedd.org.
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