BRATTLEBORO—Town Manager Peter B. Elwell kicked off the annual budget season at the Nov. 7 regular Selectboard meeting by offering a preliminary view and highlights of the municipal Fiscal Year 2019 budget.
The proposed budget for FY19 is $17.5 million.
“This is where the fun begins,” noted Board member John Allen.
Elwell and his staff formulated the budget proposal “within the context of the continued implementation of the action items of the Comprehensive Review of Town Operations and the updated long-term financial plan.”
Part of Elwell’s CRTO plan is to proactively plan to fund capital needs before they become emergencies. He told Board members “we’ve made some strides” in the past few years with funding more capital projects “with real-time revenues [and] with current cash,” and, “that’s important because it makes us more financially stable in the long run."
To that end, Elwell alerted Selectboard members to “two significant items we’ve addressed as concerns [...] for our long-term financial health that we’ve not made significant progress on."
“We don’t have a realistic and sustainable capital plan,” Elwell said. Currently, capital funding is budgeted at $1 million per year, but the town’s needs are between $2.5 million and $3 million per year. “That substantial gap is something that’s going to be a continuing challenge for us,” he said.
The other issue is connected to the first. “We have a limited ability to make progress” on a sustainable capital plan, Elwell said, because under state law, the town “has a heavy reliance on the property tax.”
’We still have heavy lifting to do’
When making incremental increases or executing new initiatives, “more often than not the cost has to be borne by increasing property taxes,” Elwell explained. “State law limits what options municipalities have available to us for collecting other kinds of revenue,” he added.
“We still have heavy lifting to do in these two areas,” Elwell said.
One wild card is the municipal center. Although the building’s renovation project — which includes preparing a large portion of the building for rental to the state — will be part of the budget discussion, Elwell said he doesn’t have enough cost information right now to include any figures in the preliminary budget.
But he believes the state’s financial contribution to the upgrades and the rent they will pay will cover most of the debt the town will incur to complete the renovations. This project will represent “a limited financial impact to the town’s budget,” Elwell said.
“What we do know,” said Elwell, is “the overwhelming majority” of the revenue raised to cover the $17.5 million budget — $14.5 million — will come from property taxes. The other revenue sources include rooms and meals taxes and other funds. Elwell noted he expects the rooms and meals tax income to increase, as this has been the trend for the past three or four years.
If the Selectboard sends the proposed budget to Representative Town Meeting, and that body passes it, property owners will see a 2.8 percent increase in their municipal taxes, or, for every $100,000 in assessed value, $8.55 more per quarter.
The revenue items of the FY19 budget are scheduled to be reviewed in detail at the Nov. 21 Selectboard meeting.
On the expenditures side, Elwell noted “a preponderance of our costs are staffing costs,” because serving townspeople’s needs requires employing people. The proposed budget sees a 1.25 percent increase in staff salaries and benefits over last year.
New town employee?
Elwell proposed adding a new employee to the town’s roster: a human-resources professional. He said “a town of this size and complexity” needs someone in this role, and this person will also support the Selectboard’s goal of increasing diversity and inclusiveness in municipal staff.
Elwell budgeted $60,000 for this person’s salary, but noted this doesn’t include benefits because those are unknown. A more detailed discussion about this change will come in a future budget meeting, he noted.
Some important questions for the Selectboard to consider as budget season progresses, Elwell said, include whether the town should slightly decrease the fund balance to help pay for a new ladder truck for the fire department, whether the town can afford other capital equipment purchases, whether the town should hire a human-resources professional, and whether the town is making enough of an investment on social-equity and energy-efficiency projects.
Elwell noted the Selectboard identified this as an important part of its work.
If there’s not enough investment, “something’s gotta give,” either by raising property taxes, or achieving “savings someplace else.”
“We will wrestle hard through that balancing act” throughout budget season, Elwell noted.
In a series of Selectboard meetings, both regular and special, Elwell and the Selectboard will work on the FY19 budget. These meetings are set to begin Nov. 21 and happen nearly every week until Jan. 23. He announced an extra budget meeting, lasting “several hours,” on Saturday, Dec. 2, where he will review each department and its budget.
“There will be a lot of opportunities for the public to make comments,” said Selectboard Chair Kate O’Connor, who noted, “there are, at this point, nine meetings scheduled.”