As published in the Record Journal Tuesday January 1, 2013
WALLINGFORD - The town more than doubled its operating surplus for fiscal year 2011-12 over the total from the previous 12 months, closing out the year $1,682,000 under budget, according to an annual audit.
Still, even though the town closed out in the black, Mayor William W. Dickinson Jr. warned that looming state and federal budget cuts could be a problem.
“Given what’s going on at the state level and the federal level … there could be a reduction of services,” Dickinson said. “At what point in there is the town going to need to pick up those previously funded services?”
Dickinson and Comptroller James Bowes presented the results of an audit done by Blum Shapiro of West Hartford during an annual end-of-theyear press conference Friday. A handful of town councilors were there, as well as some town staff.
Wallingford’s total operating budget for 2011-12 was $141,448,848.
Bowes said the surplus was primarily the result of two major factors: a mild winter that required little in the way of supplies, equipment and overtime costs for snow and ice removal; and a municipal revenue sharing grant the town received from the state to plug some of the financial holes created after the state ended a longtime program that gave cities and towns money in exchange for not taxing machinery. The town had approved its budget for the year before the new grant was included in the state’s budget, and had planned to lose the $800,000 it ended up receiving.
Bowes said he was unsure whether the state would be providing a similar grant in the coming year.
In other increases, the town’s tax collection rate was a bit higher than budgeted, Bowes said.
But there were losses, as the town’s interest revenue continues to decline. It earned about $100,000 less in interest in fiscal year 2011-12 than in previous years, Bowes said.
Bowes said the fiscal picture was in doubt at times during the year as the town waited to hear if it would receive reimbursement money from the Federal Emergency Management Agency for Hurricane Irene and winter storm Alfred.
“If the federal government doesn’t come through with FEMA … it can swing you from a healthy year to a loss,” Bowes said.
The town eventually received the reimbursement it sought.
The surplus, $1,682,000, will go into the town’s general fund.
“The credit ratings agencies like to see that you have funds in reserve, that you are not on the brink of borrowing money whenever anything occurs,” Dickinson said.
But Democratic Town Councilor Jason Zandri said he’d like to see the roughly $1.7 million surplus go toward improving parking in the downtown area.
“This is like found money,” he said. “Rather than putting it into the general fund — where it almost never comes out — why not utilize it?”
Republican Councilor Craig Fishbein said he supported putting the money away to prepare for possible cuts in state aid.
“We have to protect our taxpayers,”he said. Democratic Councilor John Sullivan said he was pleased to see a surplus in tough economic times. “Most people should be happy,” he said.
And as for putting the money away or spending it, Sullivan said money should be saved because there is “too much uncertainty” at the state and federal level.
“We don’t know if what was funded this year will be funded next year,” he said.
The audit Friday also covered the town’s utilities. The Electric Division saw a net loss in the 2011-12 fiscal year of $565,000, which Bowes said was anticipated and due mostly to power purchase costs. The Sewer Division also had a net loss, of $230,000, which Dickinson attributed to the values of its equipment depreciating. The Water Division had a surplus of $436,000.
Dickinson was pleased but cautious.
“We’re holding our own,” Dickinson said. “We’re able to address the needs of the community, but again this current year had a tax increase; that’s a reality that goes along with good finances.”