PUBLI BLIC C HE HEARI RING NG PRO ROPOS OSED ED BUDGET ET - FY FY 2018 – 20 2019 19 Janua uary y 10, 2018 April il 17, 2018 1
Jim m Pe Persano ano Chairman, rman, Board of Fi Finance ance WE WELCOME OME 2
WELCOME • The Board d of Finan ance e would ld like e to welcome ome and thank nk you, the citize izens, ns, for atten endin ding g our ur bu budget pub ublic ic hearing ring • Good, , resp sponsiv onsive, e, govern ernment ment depends ds on your interest erest and involv lvemen ement • Would like e to acknowledge wledge and thank k the staf aff f at the Somer mers s Public lic Schools, ols, the Board d of Educati cation, on, and the Sup uperin erintendent endent of Schools ools for their eir efforts ts in n the preparation aration of the Board of Education’s Budge get • Would also so like e to ext xten end a thank nk you to the Town Depar artme tment nt Heads, ds, the Boar ard of Selectmen, ectmen, Finance nce Depar artme tment, nt, and Chief ef Financi ncial al Officer er for their ir help in prepari paring ng the Selectmen’s Budget 3 3
PROP OPOSE OSED D 2018-2019 BUD UDGET PUB UBLI LIC HE HEARING ING This evening’s program will include the following: AGEND ENDA Welcom lcome Board d of Fina nanc nce, , Chairma irman James es Persan ano Bud udge get t Overvie view First st Select lectman man Bud Knorr orr Propos posed ed Bud udge get Chief ief Financia ancial Officer cer Michael ael Marinacc ccio io Board d of Ed Educ ucati tion on Sup uper erint intende ndent nt of Schoo hools Brian Czapl pla Pub ublic c Comm mments nts Aud udience ence Michael ael Par Parker er Wrap Up Up First st Select lectman man Bud Knorr orr 4
Bud ud Knorr rr Fi First t Se Selectman ctman BUDGET OVERVIEW IEW 5
FY 2018-2019 BUD UDGET ET CHA HALL LLENG NGES ES STATE TE ISS SSUES UES • State revenue ue det eterio iorat ratio ion n remains ains a growing ing concern n -- -- Connecticut’s money is moving out out State has shifted ed their r difficult icult financial ancial burden n to the citie ies s and • towns • Hartf tford d bailout ut means ns less aid d for small towns ns • Raises ses concern rns for r further her state funding ding cuts to the Town -- -- both oth in the second d half of the current nt year, , fiscal al 2018 18 and in the next fiscal cal year 2019 • Many towns s have had their bond rating ings s negativ tivel ely y affected d because se of uncertai tainty nty re regarding ding State munic nicipal ipal aid d levels • Message is clear: : Need to reduce e reliance nce on state funding, ding, and expand nd the Town’s revenue base 6
FY 2018-2019 BUD UDGET ET CHA HALL LLENG NGES ES TOWN N CHALLE LENGE GES This year’s budget is heavil vily y impac pacted d by the loss of State • revenue ue and the modest growth h in the Grand d List st Both oth the Boards ds of Selectmen en and Education ation have stri rived ed to • mainta intain n current nt level of essentia ial servic ices s whil ile demons nstr trating ating their r resolve to hold the line on budget et growth th • The Board d of Financ ance has stri rived d to maint intain ain a balanc nce betwee etween n sound d fiscal al health h witho thout ut negativ ively y impac acting ting our communit unity y needs • Only with On h fiscal cal stabil ility ity and economic ic growth th will the Town be able to wea weathe her r the storm 7
FY FY 2019 TOWN VI VISIO ION Public ic Qualit ity y of Financi ncial al Safety ety Life Stabil ility ty Sound d Economi nomic c Budge geting ting Devel elopme opment nt Well Superior ior Maint ntain ined ed School ols Essen enti tial Roads ds Services ices “A Healthy Community” 8
Michael ael Marinacci inaccio Chief f Fi Financ ancial ial Officer cer PROP OPOSE OSED D BUDGET 9
SUM UMMAR ARY • Revenu enue budge dget t • Property y Tax • Use of fund d balance ce • Debt Service ice and Capital ital Projects ects • Selectmen’s Budget • Staf affing ing • Town wn Budge dget t Sum ummar mary • Peer er com ompa pari rison sons s • Mill l rate e growth wth • Tax x incre rease ase impa mpact ct 10 10
REVENUE BUDGET 20 2017-18 18 2018-19 19 Increa crease se/ % Adopt dopted ed Pr Propos oposed ed (Decrea ecrease) e) Property Taxes $21,453,004 $23,530,333 $2,077,329 9.68% State/Federal Grants 9,180,900 7,696,138 (1,484,762) (16.17%) Use of Fund Balance 803,174 0 (803,174) (100%) Other Financing Sources 795,915 1,032,106 236,191 29.67% Totals tals $32, $32,232 232,99 ,993 $32, $32,258 258,5 ,577 $ 25, 5,58 584 4 0.08% 8% 3.2% Ta Taxes es 23.9 .9% State Ai ate Aid Othe Other F Fin inancing ing Sources es 72.9 .9% 11
PROPERTY TAXES TOTAL BUDGET $23,530,333 • Increase of $2,077,329 or 9.68% over last year’s budget • Proper perty ty Taxes es account nt for 73% of the FY 2019 r revenue nue in the bu budget • Stat ate e OPM database base shows s that at out of 169 Towns, s, Somer mers s th in proper ranks ks as 157 th erty ty tax x revenue nue per capita ta (Low) w) • Based ed on pr n prior or collection ection hist stor ory y we have assume sumed a 98.5% budgeted ed tax x collec lecti tion on rate • Continue tinue to expec pect t modest est increases eases in delinq inque uent nt tax x revenue nue colle lections ctions • Grand nd List st increased reased approxima imately ely $10 million llion or 1. 1.1% higher her than last st year r ($862 milli llion n vs. $852 million); llion); results esults in n additi itional onal tax x revenu nue of abo bout ut $254k 12
STATE E AID ID – DE DEEPER PER DI DIVE GRANT ANT ESTIMA MATE TES FY 2017 7 - 2018 18 State e adop opted ed FY20 2018 8 Bud udget t in October ober 2017 7 (bienn iennial ial bud udge get t for Fisca cal l • Years s 2017-18 8 and 2018 8 -19) 9) OPM anno noun unce ced d Post t - Holdback dback Bud udget t in Novemb ember er 2017 7 (Am Amou ounts nts after er • the Governor’s holdbacks and lapses) – affect ects Town wn FY 2017-18 18 Reduction in town aid in State budget plus additional OPM “holdbacks” • resulted ed in a comb mbined ined State e revenue enue shor ortf tfall ll of $1.1 1 million ion or 1. 1.31 1 mill equivalent in Town’s 2018 fiscal year vs the Town’s adopted budget FY 2018 18 - 2019 Town wn initial tially ly developed eloped its FY 2018 8 -19 9 Revenue enue Bud udge get t based sed on year r two o • of State’s adopted FY 2018 -19 9 bien ennia ial l budge get t Governo ernor r annou nounce nced d propos osed d adjus ustm tmen ents ts to the e States es adopted d Fisc scal al • Year 2018 8 -19 9 bud udge get t in Febr ebruary y 2018. 18. Town wn modif odified ied state e aid estima imates es based on Governor’s proposed cuts. His cut uts s reduc duced ed our ur project jected ed FY 2019 9 aid by $731,38 387 • Aid in Town’s FY 2019 Budget based on Governor’s proposed amounts • 13 13
STATE E AID ID – COM OMMON ON MYTHS HS GRANT ANT ESTIMA MATE TES You u are going ng to recei ceive Grant t estimat stimates that t have e been een voted ed on and passed ed • by lawmak maker ers The Governor can’t unilaterally reduce or holdback aid passed by lawmakers • Year over r year ar aid compari pariso sons ns provided vided by the e state e OPM are accur urat ate • only take int nto conside sideration ration the adopted d amounts nts • they don’t not make comparisons to actual funds after cuts and holdbacks • They can’t be accurately compared t o the Town’s adopted budget • All grant Al t fun unding ding is the e same me • All state funding is earmarked for the Town’s general fund • Operati ating ng Grants ts or Statut tutory y Formula ula Grants ts (PILOT, , Mohegan n Pequ quot ot, , ECS, Muni nici cipa pal • Stabilizat zation) n) incl clude uded Capital tal or Bond Funded ded Grants nts (Town Aid d Road, Muni nici cipa pal Projects ts, , LoCIP) not ot included uded • Local cal offici cials als are not ot held ld accounta ountable ble • Must certify and send copy of Town’s adopted budget to state • Must st certi tify that t capita tal and bond funded ded grants nts are used d in accordanc dance with th stat ate statu tute • and for eligib gible e projects cts Grant t accounti nting ng must st be ac accura rate and in accordan dance Governm nment ntal Ac Accounti nting ng Standa ndards ds • Must st unde dergo rgo scrutin rutiny y of annual State Sing ngle Audit t • 14 14
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