2017-04-13 / News

Town eyes $23.7M 2017-18 budget

Council slated to vote on plan Monday

The town councilors at their meeting Monday are expected to adopt a proposed budget of approximately $23.7 million for fiscal year 2017-18, representing a $548,000 hike from the current spending plan.

The 2.4 percent increase would entail a 10-cent uptick to the existing $8.58 property tax rate. If approved, homeowners with properties valued at $500,000 will pay $50 more on their annual tax bills.

Despite the increased rate, Town Administrator Andy Nota said it remains the third-lowest in the state behind Block Island and Little Compton. The figure has hovered consistently inside a 20-cent window for four years, which Nota attributes to real estate, and this year should be no different.

“Property values continue to stay strong,” he said. “That’s a great crutch to use when you’re looking to stabilize your rate.”

The property tax levy is $19.23 million, according to Nota’s plan, $378,000 more than the current year.

The municipal side has a proposed budget of about $10.6 million, which represents a 2.7 percent uptick. Although capital improvements have been lowered by $99,500 to $1.1 million, a 16 percent increase to debt service will cost taxpayers $130,000. That’s because the town will start sustaining the $2.5 million it borrowed to expand the fire station and buy a new fire truck.

On the school side, capital improvements are down 10 percent but operations are up $280,000, which is driving the approximately $13.1 million proposal, 2 percent more than 2016-17.

Roughly $62,000 for reimbursement of the East Ferry seawall is absent this year because the harbor board has paid its debt.

In good news on the revenue side, Nota said the school’s income is increasing $32,000, while state aid could increase $36,000, “although always unpredictable,” he added.

One of the biggest outliers in the budget is a $93,500 increase in the personnel account. According to Nota, that includes a $45,000 placeholder while the police union negotiates its contract. Another $25,000 is the town’s first payment into the irrevocable trust for retirees, which does not include $124,700 already earmarked for police pensions.

Combined, the town and school have $1.15 million in the trust, which only can be used for retirement obligations. The investment has thus far earned $21,000 in profits for the town.

Looking at another new line item, the proposal includes a pension for the fire chief, a position governed by the fire department’s nonprofit organization, not the town. Ten percent of the chief’s $58,400 salary has been set aside for a pension.

At the council’s final budget workshop, a projected $30,000 reduction in anticipated healthcare costs was accepted. The councilors decided to zero out that savings by earmarking $10,000 for a roof for the old portion of the fire station, which is separate from the original bond approved by voters. Finally, public health initiatives were increased from $15,000 to $31,500.

One of the biggest challenges, Nota said, is increasing the permit fee at the transfer station sixfold to $150.

Finally, Nota highlighted the town’s hefty surplus, including the unassigned balance of $4.6 million, which is comfortably more than 15 percent of the general fund’s expenditures, a common recommendation. Moreover, that figure remains high after Nota elected to transfer $250,000 from the surplus to underwrite capital projects. In past years, the practice has been to transfer $150,000.

That unreserved fund, Nota said, has raised eyebrows. However, he believes it’s in the best interest of taxpayers to have a healthy surplus.

“It seems like a lot of money to people,” Nota said. “But it’s really paid great dividends for us with our bond ratings and other savings that we’ve been able to achieve.”

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