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A new fiscal reality

Vernon wraps town meeting with research on neighboring town budgets

VERNON—The voters of Vernon wrapped a marathon Annual Town Meeting on March 5 after three long nights of debate.

The effects of their decisions could ripple for months or years.

Voters slashed the police department budget, rejected the $4.4 million school budget, picked apart the $2.2 million municipal budget, and approved funds for transferring the town pension plan to the municipal equivalent of a 401(k) retirement plan.

The town will schedule a special town meeting to reconsider the school budget.

Annual Town Meeting marked the first town-wide budget session since Entergy announced last summer that it would close its Vermont Yankee nuclear plant later this year. The plant employs more than 600 from the tri-state area at an average salary of $100,000.

With that change looming, voters said they feared for the town’s fiscal health.

“We started this budget asking who we wanted to be when we were all done with this process,” said Selectboard Chair and former State Rep. Patricia O’Donnell.

The Selectboard presented budget numbers that compared Vernon to Dummerston, Guilford, and Putney, which are of similar size. Prior to Annual Town Meeting, the Selectboard reached out to these towns for guidance on budgeting with fewer dollars.

According to O’Donnell, fiscal year 2015 is the first time in 42 years the budget has been cut.

O’Donnell said that after she and the Selectboard compared several of Vernon’s line items with that of its neighbors, “We were absolutely shocked by what we saw. There were some glaring differences.”

In general, Vernon spent more money on core municipal services, and employed more people, than each of the three comparable towns. O’Donnell also remarked that the board was surprised that some municipal workers in the other towns shovel their town hall steps themselves after snowstorms.

For example, in fiscal year 2014, Vernon budgeted $90,276 for its town clerk’s office. Vernon’s budget was some $40,000 to $60,000 higher than the other three towns.

Last year, Vernon budgeted $109,550 for its treasurer. In contrast, Guilford budgeted $40,600 for the same position, the highest of those three towns.

The board told voters that, through cuts in personnel and other areas, it trimmed fiscal 2015’s budget by $400,384, or 15.97 percent, compared to the previous fiscal year.

O’Donnell also noted that the sentiment toward Vernon is that the town has been spoiled by funding from VY.

Still, said O’Donnell, the board tried to balance fiscal prudence with attractive services so that Vernon would remain a vital town that people would wanted to relocate to.

O’Donnell told the audience that this budget is not about “us [versus] them” but rather “about all of us and how we’re going to survive.”

Symptomatic of voters’ worries: the 118-112 vote that slashed the police department’s budget from $262,095 to $40,000. Voters urged the Selectboard to use the remaining funds to contract with either the Vermont State Police or Windham County Sheriff’s Department.

When queried, a ranking member of the Vernon Police Department said at the meeting that, with a $40,000 budget, the town would see a reduction in some police services.

He added that Police Chief Mary Beth Herbert had already cut the budget and altered staff to save the taxpayers $35,628 in fiscal year 2015.

In interviews with other media outlets, VSP and WCSD representatives have said that $40,000 would provide very limited police coverage for the town, roughly about 20 to 30 hours a week of patrols.

The school proposal failed by Australian ballot, 265-257. The school board presented the $4.4 million budget for fiscal 2015 on March 3, the first night of Town Meeting. During the presentation, voters urged the board to keep costs low and asked why expenses continued to climb against lower student enrollments.

Also discussed at length: whether to move the town’s pension funds into a municipal 457(b) plan. O’Donnell said that this issue arose last year when the town needed to find $350,000 to buffer the underfunded portion of its pension fund during a stock market downturn.

The Selectboard told voters that it wanted to change the way it funded pensions because it felt the current funding exposed taxpayers to too much volatility.

O’Donnell said the proposal to rethink the town’s pension fund investment “[is] not a panic because VY is closing. We do not want taxpayers on the hook for something they can’t control.”

Voters approved using $100,000 from the Emergency Capital Fund to put toward the unfunded portion of the pension fund. This money will facilitate pending retirements and the transfer of the pension fund into a 457(b) plan.

Voters also approved funding for town elder assistance and the James Cusick Scholarship Fund but denied Southeastern Vermont Economic Development Strategies’s (SeVEDS) request for funding for economic development activities.

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Originally published in The Commons issue #245 (Wednesday, March 12, 2014). This story appeared on page A1.

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