Mountainside’s $457 Margin: Living on the Edge of the CAP

Mountainside was one of the more annoying budgets to get – there were no top line items on the agenda and it was introduced far closer to deadline than other budgets giving the public a much shorter review period than the other municipalities we’ve covered, We’ll start with our typical disclaimer – like every other preliminary budget we covered, the numbers we’re presenting here can change by the time it’s adopted. We’re going to use the same framework we applied to the other six budgets – starting with the 2024 ACFR (baseline for actual spend) to the 2025 Adopted to the most current 2026 Preliminary.

Mountainside comes in at ~ $18.55M for 2026, up from ~$16.25M from the ACFR which represents a ~$2.3M (+14%) in year-over-year increase which isn’t a small hop for a town this size.

The municipal purpose tax levy goes up ~662K from 2025 to $11.26M in ’26 prelim. budget. The library tax comes in at a little over $900K bringing the total tax supporting the budget to ~$12.16M. Taxes are moving up but not at the same pace as spending.

Which leads us to revenue which includes ~$2.88M surplus, ~$3.36M in misc. revenue, ~776k in state aid, The standout is a $1.155M asset sale that pops up – while it certainly helps, it’s a one-time infusion that’s doing some hard work in the budget – so Mountainside will have a bit if figuring out to do in future budgets if it wants to keep this structure balanced.

Currently Mountainside appears to be right at the edge of its CAP – the max allowed is 3.5% which comes to around $12.12M and the budget comes in only about $457 under the CAP. That’s a bit of a red flag as there isn’t much flexibility built in. So while that $1.155M doesn’t seem like a lot within the context of a Jersey budget -it’s doing a lot for Mountainside this year and creates a question mark for the next.

Spending is predictable – ~$12M within CAPS, ~$5.47M outside and $960K in reserves for uncollected taxes based on a 97.67% assumption on collection rate. Based on the ’24 ACFR Baseline the big cost centers were consistent with Police Salaries alone coming in over $3M and rising, insurance is around $1.2M total budgeted group insurance and also climbing while shared services (sewer costs as an example) take a nice bite of the money pie.

Mountainside is staying under the levy, and has about $1.5M left in unused room ($11.26M actual levy against a $12.77M maximum allowable levy). While that looks like breathing room- it’s just a deferred issue- again the margins are tight and being saved by a one-time asset sale.

When you line it all up it’s a straightforward pattern – spending jumps over $2M, levy goes up ~$662K with the difference being carried by surplus and a one-time revenue injection.

Source Material

See Our Full Municipal Budget Analysis