2006 Budget Challenges

•Additional Increases in Pension Contributions = +$451,200

•Additional Assessment from RVSA = +$315,000

•Increases in Fuel and Utility Costs = +$90,000

•Increase in Group Health Insurance = +$299,000

•Union Contract Increases = +$536,700

•Public Library Increase = +$205,468

•Debt Service Increase = +$60,500

•Animal Control Services = +$15,000

•No Increase in State Aid

•Decrease in Municipal Court Revenues -$170,000

The Municipal Budget Process

•Information Gathering

•Department Requests

•Financial Projections

•Review & Discussion

•Public Presentation & Initial Approval

•Auditor Review & State DCA Approval

•Public Hearing & Adoption

Information Gathering

• Is a continual process from the completion of one budget to the start of the next

• Salary Projections- Negotiated Union Contracts

- Existing Staffing Levels

• Employee Benefit Costs• Debt Requirements• Utility Costs and Other Projections

Department Requests

• Submitted in mid November• Request Operating Expense Needs consistent

with existing trends• Detailed justification for trend variances• Line Item Requests itemized according to

classification of expenditure• Review of Staffing Levels

Financial Projections

• December is wrap-up month• Revenue Projections to year-end

- Tax Collections, % from prior years

- State Aid received in full

- Miscellaneous (Parking, Construction, Court etc…)

• Expense Projections- Determine Cancellations & Reserves

- Unspent Prior Budget Closed to Reserve

• Departmental Budget Meetings, review requests

Financial Projections (continued)

• Project Year End Fund Balance

• State Aid does NOT increase

• Miscellaneous Revenue based on current year’s projected totals

• Fund Balance used as Revenue to the extent prudent - Must maintain adequate reserve balance

• Tax Revenue calculation

Budget Review and Discussion

•January 2006

- Finance Policy Committee meets with Auditors for 2005 budget wrap-up and 2006 projection analysis & priorities

•February 2006- Initial draft budget submitted to Finance Policy Committee

•February & March 2006 include policy discussion sessions:

- Staffing Levels

- Spending Priorities, or Cuts

- Budget Impact on Tax Rate

- Services or Programs to Add, Continue or Discontinue

Public Presentation and Initial Approval• First Reading, Introduced to the Public• Public Hearing Date Announced• Budget Summary Advertised

Auditor Review & DCA Approval•Statutory Compliance and Clerical Accuracy

•Budget Discretion is solely by the Town Council – Auditor and DCA opinion is limited to legal compliance

•Approval on Statutory Compliance required before Public Hearing and Adoption

Public Hearing and Adoption

•Opportunity for the Public to Comment

•Final Vote to Town Council occurs after listening to public

comments

•Budget can be approved, amended without extending public hearing, amended with additional public hearings, tabled pending

discussion on possible amendments, or rejected

2005 Total Tax Collections $107,806,714.26

County Taxes20.31%

$21,905,091.50

Town16.32%

$17,585,345.65

Board of Education62.53%

$67,415,638

County Open Space Tax.84%

$900,639.11

2006 Appropriations Breakdown

Statutory/Required Appropriations

- Pensions, Social Security, Unemployment, Library,

RVSA, Group Insurance, Street Lighting, Fire Hydrants

Non-discretionary Appropriations

- Salaries & Benefits

- Debt Service Payments

- Miscellaneous & Reserve for Uncollected Taxes

Discretionary Appropriations

- Departmental Expense Budgets

2006 Appropriation BreakdownTotal Expenses = $33,896,440

Salary & Wages 47.8%

$16,190,801

Capital Improvement Fund 0.4%

$145,000Statutory/Required

29.3%$9,929,220

Deferred Charges0.4%

$120,000

Reserve for Uncollected Taxes5.3%

$1,790,000Debt Service

3.9%$1,335,900

Operating Expenses12.9%

$4,385,519

2006 Appropriations Highlights

•Departmental Operating Budgets down 2%

- $89,260

Salaries Budget up 2.9%

+ $461,728

Debt Service down 2.6%

- $39,500

Statutory/Required Expenditures up 14.6%

+ $1,263,968

Reserve for Uncollected Taxes down 3.8%

- $70,000

2006 Appropriations Analysis

Departmental Operating Budgets

Administration - $20,000 (8.5%)

Fire Dept. - $14,812 (8.4%)

Public Works - $51,000 (4.4%)

Building Dept. - $49,000 (46.4%)

TV36 - $15,180 (45.5%)

Utilities + $90,000 (16.8%)

2006 Appropriations Analysis (continued)

Salary Budget

Administration - $39,661 (9.9%)

Police Dept. + $217,600 (3.9%)

Fire Dept. + $224,000 (7.6%)

Engineering + $5,299 (0.7%)

Public Works - $4,903 (0.2%)

Building Dept. + $26,482 (6.7%)

Crossing Guards + $20,000 (5.3%)

Health Department + 23,020 (4.5%)

TV36 - $9,250 (12.4%)

Parking Dept. - $66,254 (22.7%)

2006 Appropriations Analysis (continued)

Debt Service

Bond Principal & Interest

+ $60,500 (4.7%)

Deferred Charges

- $100,000 (45.5%)

2006 Appropriations Analysis (continued)

Statutory/Required Expenditures

Library + $205,468 (11%)

PERS + $58,200 (138.6%)

PFRS + $393,000 (105.4%)

RVSA + $315,000 (18.8%)

Group Insurance + $299,000 (9.2%)

“Budget Busters”

Did You Know…

The Municipal Budget includes appropriations for:

•Street Lighting $270,000

•Public Fire Hydrants $480,000

•Senior Transportation Services $102,500

•School Crossing Guards $400,000

•Reserve for Uncollected Taxes $1,790,000

2006 Revenue Breakdown

Revenue Sources

- Property Taxes

- State Aid

- Miscellaneous Revenue

- Grants (offset by appropriations)

- Fund Balance

2006 Revenue BreakdownTotal Revenues = $33,896,440

Local Property Taxes56.11%

$19,019,139.61

Chapter 159/Grants.18%

$59,866.19

Fund Balance11.80%

$4,000,000

Misc. Revenue16.17%

$5,482,530.20

State Aid13.23%

$4,484,904

Delinquent Taxes2.51%

$850,000

State Aid Analysis

Year State Aid Inc./Dec. % of Budget

2001 $4,232,699 17.07%

2002 $4,229,618 -$3,081 16.16%

2003 $4,250,784 +$21,166 15.19%

2004 $4,484,903 +$234,119 14.97%

2005 $4,484,903 +$0 13.86%

2006 $4,484,903 +$0 13.24%

State Aid Analysis (continued)

$3,800,000

$4,000,000

$4,200,000

$4,400,000

$4,600,000

$4,800,000

$5,000,000

2001 2002 2003 2004 2005 2006

Year

$ M

illio

ns

Did You Know…

Anticipated Revenue Sources include:

•Municipal Court Fines and Fees $530,690

•Parking Permits, Meters & Pay Stations $1,520,000

•Building Department Fees $890,000

•Interest on Income & Investments $490,000

• State Aid $4,484,903

• Delinquent Taxes $867,000

•Fund Balance $4,000,000

Tax Calculation Formula

Total Appropriations $33,896,440

minus

Anticipated Revenues $14,877,300

equals

Local Purpose Tax $19,019,139

divided by

Total Assessed Value $1,851,680,092

equals

Local Tax Rate 1.027

per $100 assessed value

Tax Cost Comparison

2005 Average Assessed Home = $178,600

2006 Average Assessed Home = $179,800

2005 2006*

County Tax $2,206 $2,289

School Tax $6,522 $6,818

Local Tax $1,702 $1,847

Total Tax $10,430 $10,954

* 2006 Tax Costs Estimated

Continued Examination …

•Regional Health Department

•Management of RVSA Assessments

•Existing Staffing Levels

•Group Health Insurance

•Effective Contract Negotiations

•Shared Services

•Review of Revenue Sources

•Efficiency Studies

Increases for 2007 Budget

•Additional 20% increase in Pension Contributions (PFRS 80%, PERS 60%)

•Additional Assessment from RVSA

•Increases in Fuel and Energy Costs

•Group Health & Casualty Insurance

•Union Contracts

•Continuation of Services (Leaf Collection, Snow Removal, Street Lighting, Recycling, Police & Fire Services, Conservation Center,

Infrastructure Improvements, etc…)

2006 Budget Challenges Met•Health Insurance Costs Reduced by Effective Contract Negotiations

•Public Library Board partners with Council to long term cost savings to taxpayers

•Debt Service decreased by reducing Deferred Charges

•Decrease in Court Revenues due to State Surcharges

•Staffing Levels decreased where possible. Five F/T position reduced to 2 P/T positions

•Reduction of Reserve for Uncollected Taxes

•Comprehensive examination of total budget producing real savings in all departments