More difficult times are ahead for the state government and for local municipalities.

That's the message local officials heard while they were at the League of Municipalities annual conference in Atlantic City last week. About 10 Millburn-Short Hills officials attended last week's affair, including Mayor Sandra Haimoff and Township Administrator Tim Gordon.

"I wouldn't be surprised if there are more state aid cuts," Gordon said of the conversations and meetings he had during the league's conference.

Millburn suffered a cut to its state aid of $126,000 for 2009. If Millburn lost the same amount for 2010, Gordon said, it wouldn't be a tragedy. But the problem is if there are deeper cuts or if they keep happening each year.

In order to raise revenue, it makes most sense to raise taxes if aid is cut, he said. But there is a cap on how much township officials can raise taxes each year. "It means we have to cut, but at some point we can't cut any more," he said.

"How they can keep cutting (municipal aid) and then say there needs to be property tax relief is a mystery," he said. "And (state officials) will admit shared services don't produce much savings."

Haimoff said property taxes are a main concern, but there isn't a whole lot officials can do. Other communities are in a position where they need to cut positions in order to enact savings, but Millburn do not need to do that.

It would also help if municipalities could retain some of the money they send to the state, including the real estate transfer fees, she said. Most of the money goes to the state, and it would help if some of that money stayed local.

Millburn officials are pursuing more shared services. Haimoff said she spoke to officials from Summit about the potential for more shared services there, aside from the pending fire department study.

Haimoff said there was a resolution the league considered about trying to find another means to fund school districts, which is a major chunk of tax dollars. But as a former school board member, she wants to know how it would be done. Other states have tried to find alternative means to fund education, but they have not worked well and destabilized education districts, she said.

Plus state officials need to stop issuing mandates for every school district, she said. The mandates are not needed in every district, and many go unfunded by state officials.

Everyone realizes New Jersey probably is in its worst financial situation ever, and it started before the current economic crisis, Gordon said.

"Once they started fooling around with the pensions 10 years ago, it helped put the state's economy in decline," he said. "One governor after the next has let it happen."

Meanwhile, the league passed the resolution to sponsor legislation to allow municipalities to opt out of civil service, which Millburn officials had pushed to happen. "People said it was about time," Haimoff said of the response from other officials.