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Community Corner

Great Communications: The Patch

I started a blog on the Patch and I have received great feedback on some of my opinions. Some agree some don't, but the dialogue is invaluable! Permit me to make several points:
1. Shouldn't our local politicians be expressing their opinions instead of me? Just to keep in "touch" with their constituencies.
2. Yes, it takes discipline to save for distant financial needs. We have three daughters. They all went to college. The cost was about $550,000. Neither we nor they had to borrow a dime for the education. They day each was born we started saving for their future. Every penny they received as gifts, our contributions, and a vibrant stock market in the nineties secured their education, if they wanted one. I come from the not-for-profit world. The operating budget for the last association for which I served as CEO had a budget of $5.5 million. The rule of thumb is a "reserve fund" of about 50% of operations...or $2.5 million. That fund was used for capital investments and emergencies. In the private sector, large corporations have reserves much, much larger. How do you think GM is paying for the billions in recalls? Or, the tobacco industry paid billions to settle law suits. Think reserves! Municipalities in NJ are required by law to have a reserve fund, but there is a limit to how much can be reserved. There is no legal impediment for municipalities to have a capital investment set-aside fund. The concept here is to avoid having to borrow money or raise taxes when big capital investments are required. Yes, as an individual we have a family set-aside fund. We do not live pay check to pay check. Financial planners say that every one should have at least an amount equal to six months of salary set aside. I suggest that it needs to be closer to a year. That fund should be off limits except when unexpected needs occur. That money should be invested wisely so as to get a little help from the market. When the need for a new refrigerator, new roof, even a down payment on a new car comes up you have the money. Such an approach takes financial discipline, but people do it...and yes I expect local government to do the same thing!
3. Strategic planning requires the clear identification of an over-arching "vision". That should be developed by the body that will implement the plan decided upon. I have no idea where the vision might land, but I am of the opinion that if the vision is "Increasing Land Values" all other things fall in place...like a good safety program and reasonable services. The mistake made too often is that a plan confuses the "ends" with the "means" I suggest that the end might be increasing land values and the means might be agood safety program, excellent schools, and ultra clean streets and public space. Another means is to use tax policy to achieve desired ends.
4. The whole point of my opinion piece is that there NO STRATEGIC PLANNING GOING ON!
What do you think?

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