Selectmen Finalize 2011-12 Budget Request Asking For 2.7 Percent Hike

By John Voket

The Board of Selectmen completed its 2011-12 budget deliberations in just two evenings, approving and forwarding a spending proposal requesting $38,093,157, or an increase of 2.7 percent, to the Board of Finance.

In previous years, selectmen deliberations extended to as many as four separate meetings. This year’s two budget sessions were markedly different from any in recent years, in part because department heads, First Selectman Pat Llodra, and Finance Director Robert Tait had already met and implemented data from a new worksheet system to craft final requests for the next fiscal year.

Mrs Llodra told her fellow selectmen most of those departments came in either generally flat or contained minimal increases.

“The message we sent to our department heads, and reinforced at staff meetings [in recent months] was to fund existing services,” Mrs Llodra told her board January 20. “Our expectation was: no new programs, no new personnel.”

The selectmen further expedited proceedings after reviewing in advance and approving about three dozen line items in a single motion. Those requests included numerous town departments, agencies, and a number of regional social and human service organizations that serve Newtown residents.

This predeliberation groundwork created an environment where department heads who traditionally make the highest requests — from Public Works, Newtown Police, and Parks and Recreation — were available to respond to any specific questions or prompts from the board. And while the omnibus motion authorized just under $3 million in requests, selectmen received details from those department proposals in context with the supervisors’ comments January 20, and returned January 24 to discuss, adjust, and approve the requests of those three departments.

While there was little discussion of the implications of Mrs Llodra’s overall proposal, in advance of the January 20 meeting she provided an executive summary that summed up her justification for the budget request increase, as well as some other points on the overall proposal. In referring to the increase, which was eventually cut down to 2.7 percent, Mrs Llodra said: “It is difficult for me to offer up a budget that reflects [an] increase of the level of funding from the prior fiscal year,” she stated. “...much is non-discretionary that very little is left for improvements that are necessary.”

Requested Increases Explained

The first selectman’s memo referred to increased “non-discretionary” expenses in the new budget proposal as:

*$390,539 to cover additional debt service — primarily due to the final bonding to pay for the now nearly completed high school addition. Debt service for all town projects including school projects are carried under the town side or selectmen’s budget.

*$225,000 representing the first of four installment allocations to the Capital Nonrecurring Fund — specifically earmarked to replace an aging town street sweeper, fire apparatus formerly bonded, and the cost of Newtown’s next revaluation, which will begin in 2012. This is part of an overall move to use installment savings to plan for major capital purchases, which will now be purchased outright instead of incurring up to 20 years of additional borrowing costs to bond them.

*$213,366 in additional funding to Public Works — $40,000 to repair or upgrade the existing fleet instead of incurring substantially more expense to replace aging vehicles and equipment; $61,000 to extend the life of several roadways through overlays, versus a substantially higher cost to resurface or re-engineer those roads; $75,000 more for treated road salt — reflecting the average town use of 3,400 tons per winter; $36,000 in increased contractual service costs for the town dump.

Among the other expenses amounting to the request for an increased budget next fiscal year were:

*$48,285 in additional contributions to the local pension fund. This reflects a downturn in the fund’s rate of return on investments. In a separate venue, town officials are continuing to work on pension fund management and policy adjustments, including lowering this anticipated rate of return to a level reflecting current economic trends.

*$78,122 to cover increased medical costs. This increase was substantially minimized, according to Mrs Llodra, because of the town’s shift to a self-funded health insurance program. Increases were further minimized because employees are contributing more of the overall cost to a plan that is less expensive to manage.

*$91,196,, which represents a previously negotiated wage and step increases for town police officers.

While the first of two budget session with the selectmen consisted of primarily hearing points of justification for requests by police, highway and parks officials, the second meeting centered around brief reviews and approvals of all the budget request line items. Only representatives from the library board, the Economic Development Commission, and the town’s Sustainable Energy Commission were on hand making pitches for some items that selectmen advised should be considered as capital expenses.

Don Sharpe and Margaret Oliger form the EDC opened up the meeting requesting $20,000 be added to its line item to hire a town economic development coordinator. That individual would have a $30,000 salary for a 19-hour work week, with $10,000 being supplemented from the commission’s existing budget. That part-time official would support the work of Community Development Director Elizabeth Stocker.

Selectman Rodgers, however, said that the timing of the request was not ideal, and Mrs Llodra reiterated that her initial request for departments to hold the line on new hiring should stand, despite the fact that EDC officials believe now is the time to implement a new staffer. The selectmen eventually approved $5,000 to be added to the EDC budget under its part-time payroll line.

Energy commission members Dan Holmes and Desiree Galassi appealed for a number of initiatives, including solar panels for the middle school to help cut energy costs, pellet boiler systems for some school buildings, feasibility studies and seed money to enhance the town’s ability to attract grants by providing matching funds for proposed projects. But since most of the commission’s proposals involved initiatives that rise to or above the criteria for the Capital Improvement Plan, Mrs Llodra suggested the commission begin working with a modest operating budget of $5,000, crafting their capital project proposals for consideration in the next round of CIP deliberations.

“You are doing the government’s work when you do some of this outreach,” Mrs Llodra said. “[But] most of your work is capital projects.”

Selectman Bill Furrier also observed that while the energy panel is promoting some of its projects with recoup costs tied to local budget investments, when factoring in state or federal grant money, which is still taxpayer funded, the recoup period for things like solar panels extends far beyond the expected lifespan of the hardware requested.

Calling the proposal for photovoltaic panels a “poor use of taxpayer dollars,” Selectman Furrier said in considering any energy commission requests, “We have to be responsible to state [taxpayers].”

Wrapping Things Up

Part of the library board’s request included a 1.5 percent increase for personnel, after a three-year period of wage freezes. After some discussion, Mrs Llodra and Mr Furrier approved an amended request of $1,030,552 after reducing the original request by $3,000.

Selectman Will Rodgers recused himself from the vote because his wife, Moira, is on the library board. But he offered the suggestion of asking the Friends of the Library to expand its policy of donating exclusively to support the book and media collection to incorporate some operating support, including underwriting facility improvements.

“In this economy [the Friends of the Library] can’t be that tied to their principles,” he said.

Another area where Mr Rodgers recused himself involved the probate court request — Moira Rodgers was Newtown’s latest probate judge.

Mrs Llodra expressed frustration that the 2011-12 request that represents Newtown’s contribution to a new regional court was nearly double what it previously cost Newtown to administer its own exclusive court. And while Mrs Llodra and Mr Furrier initially approved the increased request, Mrs Llodra vowed to “continue to challenge why one court could cost more than the four towns to [collectively] run [probate courts] individually.”

The most discussion generated during night two of selectmen deliberations involved the very last item on the agenda, bolstering the town’s Capital Nonrecurring Fund. The selectmen’s request of $225,000 was substantial, but Mrs Llodra said it was justified even in hard financial times because it represented a responsible move toward saving to fund planned capital purchases, instead of being faced with bonding them or worse, a catastrophic loss or breakdown of a capital item which would force the selectmen to consider an emergency appropriation.

“I like the financial discipline of saving toward capital expenses,” she said.

Selectman Furrier countered that $225,000 still seemed excessive and suggested a more modest $100,000. But Mrs Llodra and Mr Rodgers explained that the CIP had already been approved with the timing of select capital purchases coinciding with available savings amassed in the capital nonrecurring account.

“It was baked in the cake with the present CIP,” Mr Rodgers said. “To make a short-term decision that has a long-term [financial] impact is not the way to go.”

Mr Tait added that maintaining an annual nonrecurring contribution of one-quarter of one percent of the overall budget reflects a municipal finance manager’s best practice, and that the current more conservative request would approach $300,000 in 2011-12 to meet the preferred threshold.

“It’s also a big number at the end of the [budget request],” Mr Furrier said.

Mrs Llodra appealed to her board to pass the request as proposed, and to “wait and see” how it would be received at the finance and council levels.

“I will argue [there] that it’s the best plan,” she said. “We have to leverage the resources that we have.”

Mr Rodgers appeared somewhat ambivalent, saying, “We should be so lucky at the end of the budget process if this is [the only budget item[ we are looking at.”

The finance board is scheduled to begin its review of the town and school district proposal following a public hearing February 17.

(A report on the first of two nights of selectmen budget deliberations appears on line at newtownbee.com, with expanded details about requests from the local police, parks and highway departments, as well as links to the selectmen’s initial proposal. This report includes an updated link to the final approved selectmen’s 2011-12 budget request.)