Date: Fri 03-Jan-1997

Publication: Bee

Author: STEVEB

Quick Words:

town-audit-surplus-$2-million

Full Text:

Town Audit Reports A $2 Million Surplus

B Y S TEVE B IGHAM

If a town has money left over from its budget from the year before, how much

of it should be used to offset taxes the following year?

It's a question asked often each year around budget time. This year's audit of

the town's accounts for the 1995-96 fiscal year revealed a surplus of just

over $2 million, continuing a recent trend of significant leftover cash.

This year's surplus fell just short of the unprecedented 1993-94 surplus of

$2.3 million. Last year's surplus totaled $1.9 million.

The Legislative Council must now determine what to do with this surplus.

Members are expected to receive a full report of the audit from Financial

Director Ben Spragg this month.

While some have argued in the past that a large surplus reflects

over-taxation, the town has been using some of the excess funds (about

$600,000) to offset taxes. On the other hand, using too much surplus in the

following year's budget can backfire in the town's face, First Selectman Bob

Cascella said.

"If you put all of the surplus into the budget at once and then next year if

you only get a half million dollars in surplus, you have to raise taxes just

to stay status quo," he said.

The town usually uses the remainder of the surplus to pay for large,

non-recurring expenses that would likely cause the town's tax rate to increase

more dramatically year-to-year, Mr Cascella said.

The report states that much of the surplus comes from nearly $1.5 million more

in revenues than had been projected, with the other half million stemming from

unspent budgeted money.

The extra revenues included: an additional $363,000 collected in property

taxes, an extra $500,000 in intergovernmental funds, $77,000 in licensing and

permits, an extra $117,000 in charges for services and $66,000 more in

miscellaneous items.

The report showed property taxes accounting for 77 percent of the general fund

revenue. Taxes were collected at a rate of 96 percent.

The extra savings included: $102,000 in general government, $143,000 in debt

service, $68,000 in public safety, $40,000 in health and welfare, $20,000 in

Planning & Zoning, $54,000 in public works, $24,000 in education, and $71,000

in parks & recreation.

The report also includes other information on the financial status of the

town. The rate of housing construction in town ranked second in the state at

the end of 1995. The growing residential tax base of single-family,

owner-occupied homes grew three percent.

The town's per capita income stayed level from the year before at $22,747,

while the average family income came in at $65,537. Both figures were above

the state average.

Newtown's unemployment rate held at 3.7 percent, well below the 5.5 percent

state average.