Town Begins Budget Discussions

March 11, 2010 by Josh Morgan

If the Town's budget were to be adopted today, the average resident of Cheshire would see a $158 tax increase next fiscal year.
Town Manager Michael Milone presented the 2010/2011 operating budget on Tuesday night, which represents a 1.57 percent increase from the current fiscal year. To support the $95.98 million spending plan, the mill rate would have to increase, resulting in a tax increase to most residents. According to Milone, the average Cheshire homeowner with two vehicles would pay $6,485 in taxes next fiscal year, an increase of approximately $158.
The overall budget proposal would increase spending by $1.48 million, a majority of which would be allocated to a $1.29 million Board of Education increase that was adopted by its members last month. Milone said he did not alter the BOE request, which could result in 12 to 15 teacher layoffs. Other portions of the budget that would increase under the plan is the Town side of the overall budget, which would go up $695,000, or 2.9 percent. Milone explained that, with fewer capital projects, the Town's debt service is decreasing to the tune of $500,000, which lessened the financial blow this year.
"We are coming off the smallest increase in history, and we already picked off the low level fruit and some of the mid and high hanging fruit last year," Milone said. "But, I'm not saying we can't work with the Council to further cut costs, but that will have policy implications."
Milone said last year's budget increase was the lowest in the past 20 years, and this year's increase represents the second lowest increase. The $695,000 general government increase is made up almost entirely of salaries and employee benefits and insurance costs. All other accounts on the Town side of the budget went up $58,000.
While bleak, Milone said the Town was "a lot luckier this year" because the decline in non-tax revenue was not as steep as it was this time last year.
"We recognized the need to develop a very austere budget," Milone said.
Milone explained that, from the onset, there were some holes in the budget that needed to be plugged. For instance, with last year's revaluation, the Town Council decided to use $600,000 in a taxpayer relief fund to limit the impact, which Milone said was "a one-time revenue." Also, the Town's investment income was down $150,000 from last year.
However, there is still some avenues to create relief, if the Council chooses to.
Milone recommended the use of $600,000 from the Town's Fund Balance, or rainy day fund, to help offset a decline in revenue. He explained that there is still roughly $8.6 million in the fund that the Council could use to further offset costs. Additionally, money from the Town's involvement with the waste-to-energy plant in Wallingford is coming, with $3.7 million already secured, and another $1.9 million expected later this year.
Council Chairman Tim Slocum said there is "a lot of work ahead of us" as the Council works through the budget in numerous workshops before adopting a final one in April.
"Now the fun starts," said Budget Committee Chairman David Schrumm.
The first of many budget workshops will be tonight, March 11, in Town Hall, at 6:30 p.m. A full schedule of the budget meetings, as well as the entire budget, can be found on the Town's Web site, www.cheshirect.org.