Date: Fri 07-Mar-1997

Publication: Bee

Author: STEVEB

Quick Words:

council-budget-Spragg

Full Text:

Council May Dip Into Capital Fund To Get It Through A Tough Year

B Y S TEVE B IGHAM

The Legislative Council's finance committee has been busy this week trying to

find a way to adjust the budget in an effort to reduce the town's $3.3 million

revenue shortfall.

Finance Director Ben Spragg's number crunching has indicated that the town's

$53 million budget, as proposed, represents more than a two mill increase in

the tax rate over last year, or a 7- to 8-percent increase in taxes.

"The feeling of the finance committee was that was much too high," said John

Kortze, the finance committee chairman.

A shortage in state aid and a lower-than-expected grand list has forced the

council to come up with a plan to avoid a large tax increase without making

any major cuts. Council members say there is not much to cut.

"It's mostly a salary and operating budget," said longtime council member

Melissa Pilchard.

The finance committee wants to whittle the tax rate increase down to about one

mill. It has recommended that the extra million dollars in this year's budget

for road improvements be left alone, but its members are recommending that

certain other expenses be funded outside the operating budget, mainly by the

capital and non-recurring improvement expenditure account. Though this reserve

fund is normally used to fund capital projects and equipment, the council has

been putting money into it in recent years earmarked for tax reduction in

anticipation of financially tough years.

"Because revenue is flat, this is a good year to do this," Mr Spragg said.

Mr Spragg has so far come up with about $900,000 worth of items from the

budget that could be funded by the capital and non-recurring account. He said

the finance committee might consider funding $100,000 worth of road

improvements in this account to cover the balance.

Mr Spragg said the town has never used money from the capital reserve for the

purpose of reducing taxation, but said it's a good use. In the past, money

from the account was used to pay for part of the library project, the Newtown

High School gymnasium, the NHS greenery, the street lights in Sandy Hook, etc.

There is about $1.4 million in the reserve that has been earmarked to offset

tax increases.