Municipal Budget Proposal Town Meeting, March 6, 2018

Today’s AgendaSummary of FY 2019 budget

Describing the budget increase and review of

significant cost changes

Discussion of the municipal operations

Review of Reserve Funds & Unassigned Fund

Balance

What the public pays for; debt service

Questions, Concerns, Anything more to discuss

Town Budget Overview• Spending increases from FY 2017-2018

$208,101 (5.88%)• By section:

-General Fund (overall) up $199,020 (10.04%) -Highway Fund up $9,082 (0.58%)

• Non-tax revenues INCREASE by $122,711, offsetting an additional 2.7¢ of the tax rate

• Municipal tax rate increase 1.83¢ to $.6941• Total increase of $85,390 in tax revenue

Factors Driving FY 2019 IncreaseThe most significant factors in the budget increase are:• General Insurance costs up $18,000 • Fire Protection Fees to Water Resources up

$12,941 • Police Vehicle Costs increase by $15,260• Employee Health Coverage increases by

$45,957, largely due to increased participation

• General Cost-of-Living of 3% for employees

Aging Fire Station• Firefighters withdrew department from

the Public Safety Building concept• Existing station built in 1970 and

expanded over time• Station requires safety and other

improvements which are in the process of being evaluated

• Utilizing $90,000 of our own savings towards this in the next fiscal year

Municipal Tax Rate Increase• Prior year projected tax rate of $0.6858 reduced

to $0.6758 (1¢) through added Grand List value• This year, the proposed tax increase is

$0.0183 (1.83¢) over the current rate to $0.6941

• Impact based on home value: »$150,000 = $27.45 per year ($2.29/month)»$200,000 = $36.60 per year ($3.05/month)»$300,000 = $54.90 per year ($4.58/month)»$400,000 = $73.20 per year ($6.10/month)

Municipal OperationsHere is an overview of the various Richmond Town departments, staffing, primary functions• Clerk/Administration/Finance – these three areas operate

very closely to manage revenue, payments, payroll, policies and projects

• Police – Chief + 5 FT officers; Community Policing• Fire – All-volunteer department, are paid for response• Planning/Zoning – FT Planner, PT Zoning – Town Plan

and Permits• Highway/Recreation = Foreman + 4 drivers/operators• Library – Governed by the Board of Trustees• Water Resources – Governed by the Water Commission

What Do You Get For Your Dollar?

• This budget preserves existing programs, services and capital planning

• Major capital purchases in Highway Department of a Tandem Dump Truck and Replacement Grader, although some debt comes off the books this year

• Personnel related costs, insurance and capital equipment are driving the bulk of the spending increase in FY2019

Projected Town & School Tax Rates 2019

0.6941, 31%

1.5520, 69%

Town Rate

Homestead Education

Sources of Town Tax Revenue

Tax Rates Over The Years(adjusted municipal rate only)

Richmond Town Budgets

Budget Allocations by Department FY2019

Administration,  

$750,566 

Assessors,  $29,950 

Planning/Zoning,  $101,671 

Police,  $690,033 Library,  

$222,725 

Fire,  $307,068 

Recreation,  $61,050 

Charitable,  $17,818 

Highway,  $1,567,105 

Reserve Funding• Reserve Funding functions like savings

accounts• We put money into the reserve through

the budget every year• We can spend money from the reserves

outside of the budget at any time• Largely functions as a safety net for

large capital purchases

Reserve Funding• The amount we save and the intended

uses of those reserves is decided by the voters

• Town departments list priorities on saving and capital purchases, which may be spent now or at some point in the future

• Reserve spending fluctuates based on current year goals

Current Reserve Balances

$0.00

$50,000.00

$100,000.00

$150,000.00

$200,000.00

$250,000.00

$300,000.00

Total Reserve growth over the years

$750,263 

$818,687 

$1,000,938 

$1,075,416 

$1,206,516 

$1,362,688 

600000

700000

800000

900000

1000000

1100000

1200000

1300000

1400000

1500000

2012 2013 2014 2015 2016 2017

Are we spending or saving?• The Reserve accounts with the highest

balances are:• Bridge and Culvert ($314,475)• Conservation Reserve ($308,719)• Town Center Maintenance ($251,683)• Highway Reserve ($122,463)• Reappraisal Reserve ($122,231)

Planned Spending of Reserves• The Bridge and Culvert Reserve will be

used for storm water replacements on East Main and Bridge Street, as well as accomplishing deferred maintenance on our bridges

• The Conservation Reserve Fund will spend $235,000; more applications are pending

Planned Spending of Reserves

• The Town Center Reserve is used for maintenance and repairs of Town Center, the Post Office and can be used for the Library as well

• Recently, the parking lot and roof have been redone, costing $200,000

• The Facilities Review will determine how to spend more of this fund; deferred maintenance on the Post Office is due

Other Reserve Plans• The Highway Reserve can be used to

place a larger down payment on the Highway Dump Truck and Road Grader than what is allocated in the proposed budget

• There is no planned revaluation of the Town, so no planned use of the Reappraisal Fund

Minor Reserve Funds

• Most other funds have modest balances

• Used for facility repairs• May be restricted for specific

purposes such as the Adam Mueller Flag Fund, the Recreation Funds etc.

Unassigned Savings• Positive results of our annual

operations – ie, “Surplus,” reverts to what is known as Unassigned Fund Balance

• Our auditor reports that having an Unassigned Fund Balance equivalent to 25% of the annual budget is “healthy”

• Having this savings greatly helps during unanticipated crisis and need for cash flow

Use of Savings• Reinvesting our savings into Capital

Expenses is the wisest use• Using these savings should be seen as

“one time revenues” not to be repeated• Subsidizing operational expenses for

the sake of a lower tax rate defers those decisions to a future time, a time where those expenses grow and savings shrink

What is Richmond Doing?• In recent years we have reinvested

some savings into Highway Equipment• In the current proposal, the $90,000 in

Fire Station repairs is offset by Fire Department Revenue, which is actually using our Unassigned Fund Balance –this capital outlay does not impact the tax rate

• Could more be done? Should more be done? What do you think?

Change in Unassigned Fund Balance

$417,858 

$392,963 $391,489 

$565,493 

$768,457 

$911,121 

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2012 2013 2014 2015 2016 2017

General Town DebtDoes not include Water System Debt

• 2005 Fire Truck = 2026; $15,000/yr• 2015 Fire Truck = 2021; $56,000/yr• 2015 Dump Truck = 2020; $20,325/yr• 2016 Dump Truck = 2021; $22,000/yr• 2017 Fire Truck = 2025; est. $58,000/yr• 2019 Dump Truck (Proposed) = 2024; $25,000/yr• 2019 Road Grader (Proposed = 2024; $35,000/yr• Jericho Road = 2032; $66,500/yr• Stormwater ARRA = 2032; $8,000/yr• East Main Street = TBD; est. $35,000/yr

Impacts of Budget Proposal

Home ValueCurrent Tax Rate/Bill

FY2019 base increase over FY2018

Total New Town Tax Bill

$0.6758 $0.0183$0.6758+$0.0183

$150,000  $1,014 $28  $1,042

$200,000  $1,352 $37  $1,389

$300,000  $2,027 $55 $2,082

$400,000  $2,703 $73 $2,776

Additional Discussions?

Future Capital Needs?Growth Concerns?

Goals?