June 19, 2013
Written by Macklin Reid, Press Staff
Monday, 27 February 2012 05:26
A tax increase with a ‘1’ before the decimal point — although closer to 2%, in truth — is within reach, according to First Selectman Rudy Marconi’s back-of-the-envelope math.
Energy savings are a big part of keeping cost increases down.
Mr. Marconi said Tuesday he’s been trying to figure where the line has to be held on spending to come in with a reasonable tax increase.“I figured 2.71% with the school and 2.4% with the town, with no contribution from fund balance, would yield a possible 1.95% tax increase,” Mr. Marconi said.
The school spending increase he used reflects the school’s board’s $425,000 reduction last week to School Superintendent Deborah Low’s request — although that actually works out to a 2.72% increase, not 2.71%.
The 2.4% town departments’ increase in his calculations does, Mr. Marconi admits, involve a bit of conjuring.
“The Board of Selectmen has not agreed with that number. That is a speculative number on my part,” he said.
In the $32 million in budget requests presented to the selectmen by town department heads are two proposed additions to the town’s “head count” of full-time employees: a new highway department worker and another police officer. The latter would refill a position left empty since 2008, Police Chief John Roche said.
To get the town-side increase down to the 2.4% used in his tax rate calculation, Mr. Marconi took out the two proposed new personnel. A 2.9%-increase had initially been proposed to the selectmen.
“To be honest, I don’t see us adding the number of people that have been requested,” he said.
That 2.4% budget does include the added $150,000 cost of six police cars, spending that traditionally appeared as part of the capital budget, where it doesn’t affect the immediate year’s tax rate.
The selectmen expect to go through the budget carefully, looking for further savings, before sending their request on to the Board of Finance. The selectmen plan a week of budget meetings Monday, March 5, to Friday, March 9.
They will also give the finance board a “non-binding” recommendation on the $81-million school budget request.
“We haven’t looked at the school budget at all. That’s going to be part of the March 26 public hearing that the Board of Finance hosts. But we, as a Board of Selectmen, will have to vote on a non-binding referral to the Board of Finance at the end of the first week of March,” Mr. Marconi said.
“We have to vote on our entire budget, which is operating, all of town capital, and a non-binding recommendation to the Board of Finance on the Board of Education budget, at the latest by March 9.”
Mr. Marconi says energy savings are playing a big role in keeping costs reasonable.
Much of the savings, though not all, has come from energy initiatives approved by voters in recent budgets.
“One of the reasons we’re at 2.4% without doing a lot is we’ve seen tremendous decreases in the cost of our heating, due to switching several of our buildings to natural gas,” Mr. Marconi said. “Secondly, because of our modification of all the lighting in all town buildings, we’re expecting a decrease in electricity there. To that you can add a decrease in the per kilowatt hour cost of electricity.”
The conversions to natural gas include the Venus office building (old high school), police station, firehouse, and town hall.
“We have planned right now both buildings at highway, including the parks and rec garage, and if the extension of the gas main is approved to that list, we will be adding Veterans Park and East Ridge Middle School,” he said.
The additional gas line extension is a $400,000 request in this year’s capital budget.
The $1.5-million energy initiative approved by voters last May included replacement of lighting at every school and town building with more energy efficient units and bulbs.
This year the town is benefiting, as the school system did previously, from moving employees into less costly Health Savings Account insurance programs.
“This is the first year where we’re actually seeing the impact of an HSA to the budget,” Mr. Marconi said, “although we don’t have everyone.”
Non-union employees and two of four union groups have been moved into HSA plans, he said, and the goal is to get the others changed as union contracts come up for negotiation.
The savings could be short-lived — a first year benefit, mostly — if the reshaped plans don’t result in reduced use of medical services. This has to do with cost-sharing provision in the plans, but also people’s health.
“We’re realizing savings by going to the HSA, but if your utilization doesn’t change, we’re going to be confronted with the same problem, with staggering increases,” Mr. Marconi said.
“We can still see large percentage increases due to plan utilization, people getting sick,” he said. “It’s difficult. No one is getting sick intentionally, but we’ve just had a horrendous couple of years on the town side, with serious illnesses.”
Another major focus for the selectmen will be reducing the number of capital requests — paid for with borrowing — before passing that portion of the budget on to the finance board.
“We’ve got to get our capital [requests] down. It’s still hovering at the $5.8-to-$6-million level,” he said. “We’ve got to get it down to that $3-$3.5-million area.
“However, this year we do have some things that have to get done, like finishing the Venus building roof — that’s a must.
“Over the next couple of weeks I’ll prioritize with the department heads and we’ll look to reduce and see what we can do to get our capital requests in line with our projections.”
He felt good about what his math exercises have shown about the operating budget and projected tax increase.
“This is pretty early in the game, and we’re down to 1.95%,” he said.
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