Bringing down the budget: Flat mill rate or total tax levy?
Concession equipment at Weed Beach, a new time and attendance system in the finance department, and cemetery cleanup were among the items the Darien Board of Selectmen discussed deferring from its 2020-2021 budget.
The discussion, which also included talk about bonding items, took place at Tuesday’s Board of Selectmen special meeting.
The reason for the discussion and budget reevaluation was due to the financial impacts to the town, both known and unknown, of COVID-19.
First Selectman Jayme Stevenson was the only member of the board who was physically in attendance at the 90-minute-long meeting. All other members participated virtually.
The discussion will be continued on Thursday, April 30, at 2 p.m., when there will be a final vote on the proposed budget modifications.
At its meeting on April 23, the Board of Finance recommended to the Board of Selectmen and Board of Education to discuss modifications in their originally proposed budgets of $47,875,998 to get to two different scenerios: A flat mill rate increase and a total dollar tax levy.
In order to get to a flat mill rate of 16.47 mills between the Board of Selectmen and the Board of Education, the Board of Selectmen needs to find a reduction of $351,000 in its budget. In order to get to a total dollar tax levy, the Board of Selectmen has to reduce its budget by $591,000.
The Board of Selectmen came up with the following suggestions:
Potentially to defer capital projects
Weed Beach funds for kitchen equipment and consultants, and Pear Tree Point Beach for any potential deferable costs.
Use of cash in uncompleted projects without resulting in penalties or legal actions for Highland Farms, regarding landscaping and walks.
Deferring new hires, three civilian dispatchers and two replacements for retired police full-time employees.
Stop or reduce open consulting projects such as at Weed Beach and others, and reduce pension contributions.
There are four items for which new circumstances have arisen since the Board of Selectmen first proposed its budget:
1- The fire marshal’s office software maintenance and support. The office changed its vendor and reduced the budget by $600.
2- Fire marshal’s office, an additional $50,000 of revenue next year because of projects that are getting a later start date.
3- Medical and dental insurance, actuarial renewals.
Medical insurance, $128,482 reduction
Dental insurance, $7,904 reduction
4 - Unemployment, a recommended increase by $19,092.
Those new circumstances total $167,894 in adjustments that are needed for getting to a flat mill rate of $183,106, and to a flat tax levy of $243,106.
Recommended deferrals, changes
Finance: New time and attendance system, $68,030.
Town clerk: A revenue adjustment to the operating budget, the town would be losing $80,000. Potential reduction in revenues, $158,250
Planning & Zoning: The affordable housing plan, it’s not due until 2022.
Noroton Heights Fire Department: Asbestos removal from the attic.
Parks & Recreation: Deferral of the concession equipment at Weed Beach
Cemetery cleanup: $10,000
Town Hall landscaping: $5,000
Contribution to the fire apparatus replacement reserve this year, entirely: $500,000
Stevenson said she will be asking the Board of Finance to bond the following items:
New fire trucks
Town Hall gymnasium upgrades of windows, $75,000,
New sidewalks, $75,000.
Unknowns, effects of COVID-19
Due to the impact of the coronavirus, the town is in a position right now where it doesn’t have enough information as to what all the negative impacts will be to the town budget, in the near term and further out, according to Stevenson.
“This crisis has hit our low wage earners and our service sector immediately and we are only just beginning to see the impacts to higher wage earners right now as their businesses begin to struggle,” Stevenson said.
She added that from a variety of perspectives, from across the country, “all indicators are that potentially 25 percent of our small businesses will not open their doors again.”
Over the course of the next two years, the town can see a significant reduction in tax revenue from its commercial business community, Stevenson said.
“We don’t really know where we’re going to be regarding building permits, what programs can run, how long they’ll be delayed and when senior, parks and rec, and youth programs will restart,” she said. “We don’t yet know what impacts there might yet be to any state grant funding, or if the state would even consider making changes to sales tax.”
Elections are also an unknown, in regard to how they will be run, as well as if they will happen entirely buy absentee ballot.
“Having our electors vote via absentee ballot would have a substantial personnel increase of time and effort,” Stevenson said.
In regard to contact tracing — the town’s public health department does not have the personnel resources at this time to do substantive contact tracing, so the town may have to hire someone for this, according to Stevenson.
PPE, cleaning costs
The town may have more cleaning costs going forward. “When we bring people back to work here in Town Hall, and our seniors back in the Mather Center, we might have to have more expensive cleaning protocols, and new technology needs,” Stevenson said.
There may be a cost in regard to procuring and storing PPE (personal protective equipment) supplies in anticipation of the next crisis.
Regarding masks, the town is very well situated for all its first responders. There is currently enough masks to handle Town Hall employees, according to Stevenson.
Masks are being distributed to seniors and to all the town’s vulnerable residents through the Human Services department and residents of the town’s assisted living communities.
Town Finance Director Jennifer Charneski said Darien maintains a very healthy fund balance.
“We do have mechanisms for appropriating from our fund balance if needed,” she added.