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02/17/2020 11:00 PMIn the first formal proposals for the town and education budgets of 2020-’21, town officials presented a proposed town budget of $20,098,459, a $1,492,147 or eight percent increase over current spending, and a $37,103,275 education budget, a $593,319 or 1.63 percent increase. The total proposed budget is $57,201,733, a 3.78 percent or $2,085,467 increase.
Under the proposed budgets, the tax rate is anticipated to increase 1.92 percent. Town Manager Karl Kilduff said that the tax rate is used to fund both the education and town budgets and encouraged people to consider the budget as a total and not just the education and town separately.
According to Kilduff’s presentation, the average Clinton resident has a tax bill of $6,562.50. The proposed tax increase would raise that bill by $126.00.
The Town Council held a special meeting on Feb. 11 so that Kilduff, Superintendent of Schools Maryann O’Donnell, and Board of Education Chair Erica Gelven could outline their proposed budgets. The Town Council was instructed by Council Chair Chris Aniskovich to not ask questions or suggest changes but to just take in the presentations during the night. Individual department line items were not reviewed during this presentation.
The numbers presented were only the initial proposals. This means the final numbers voters will eventually consider at referendum are far from set in stone.
“After tonight it stops being my budget and becomes your budget,” Kilduff told the Town Council.
Kilduff said that in the proposed budget, a portion of the fund balance would be used to help finance the capital plan and to reduce the tax rate. Kilduff reported that growth in the Grand List and a one-time adjustment in state aid would also be used to offset the budget increase.
In Kilduff’s proposed town budget, the biggest increases are in the debt services and in the capital improvements. The capital improvements are listed at $1,366,975, up $622,695 or 81 percent from the current $755,280, and the debt payment at $2,142,442, up $190,529 or 9.8 percent from $1,951,913. The town operating budget is $16,589,042, up $689,923, or 4.3 percent, from $15,899,119.
As for the capital budget, Kilduff said that reducing a reliance on bonded debt and planning for the long term were goals of the capital plan. Kilduff said that about $450,000 would be used from the fund balance for the capital projects.
“It’s better to pay cash if you can than using your credit card and it’s the same for municipalities,” Kilduff said.
Road pavement and new fire equipment were the main additions to the budget. In the past, every other year the town would see big spikes in its capital spending followed by years with comparatively smaller funding. In order to smooth out the large dips, Kilduff said the concept is to allocate a manageable dollar amount every year for capital projects.
“Road paving has been bonded in the past. Fire apparatus replacements are fairly large sums and cannot be delayed extensively without negatively impacting response rates and safety. So, the need to fund the reserve is new, but the intent is to stabilize the budget and lighten the debt load in the future. Bonding for paving results in paying more for the same street (since you have to pay principle and interest on the bonded dollars). The life cycle of the road is the same, so there is no efficiency in the use of funds,” said Kilduff.
Another reason for the increase on the town side was the settlement of union contracts.
In an email, Kilduff wrote, “Since those settlements did not happen within their fiscal year, the approved increases hit all at once and were compounded. So, from a cash basis, in the last budget the town did not have to account for the full increase since it was a partial payment. The budget for FY ‘20-’21 has to account for the full cost associated with the settlement and, as such, creates the appearance of a large jump in the salary line items looking at it year-to-year. The percent increase would have been less if the union agreements were reached earlier and accounted for full before the proposed budget year.”
In the education budget, the biggest dollar increase is in the operating budget, which proposes an increase of $610,905 or 1.9 percent to $33,572,391. The education budget contains a proposed 1.64 percent ($51,741) decrease in its debt service for a total of $3,097,758. The education capital budget proposal increases $34,155 (8.56 percent) to $433,126.
Starting on Feb. 13, the Town Council began workshops with each department in town to review each department’s individual budget items.
On Tuesday, March 3, the council will meet and make any changes to the proposed budgets. It will then forward a final proposal to a public hearing in April.
At the public hearing, residents can speak for or against either proposed budget, and then the Town Council can make one last round of changes before forwarding the proposed budgets to referendum in May.
New Process
The budget process this year has been streamlined from years past due to changes in the town’s charter. Under the new charter that went into effect in November 2019, the Board of Finance—and the Board of Finance workshops—have been eliminated. Instead, the Town Council is responsible for approving Kilduff’s proposed budget or asking for changes to be made to the budget.
Town officials are hoping that this new process will lead to a repeat of 2019 when both the town and education budget were passed by voters on the first referendum for second time since 2009. During the previous two years the town was forced to hold four and three referendums respectively.
At the referendum, voters cast their votes on the town and schools proposed budget separately. This means it’s possible for voters to pass one budget and reject the other in the same referendum.
If one or both of budgets fail, it is revised by the Town Council immediately following the vote. Another public hearing is held the following week and another referendum is held the week after the public hearing.