Bridgton Town Manager unveils draft budget

By Lisa Williams Ackley

Staff Writer

The budget for the Town of Bridgton for 2013 was unveiled at the Bridgton Board of Selectmen’s meeting last week by Town Manager Mitch Berkowitz.

“It is a collaboration of the department heads’ budget preparation, an effort to continue core services while locating areas where savings may be achieved and as a policy statement of those items where it be capital equipment, Town infrastructure or reserves to support future investments,” Berkowitz said, during his presentation. “The Fiscal Year 2013 budget also reflects significant outcomes as a result of the work we have done and decisions made over the past 12 months. These include a change in the way we deliver emergency services dispatching, support services for both public safety departments and health insurance modifications.”

“In the six budgets that I have participated in,” Berkowitz said further, “we have attempted to educate and inform our community members of the need to plan ahead, provide fiscal stability and when necessary, support changes that may have included fiscal impacts. We also knew that changes and demands upon our budgets from SAD 61, Cumberland County and the state were going to stretch our local ability to maintain a tax rate that would not increase sharply. Not so predictable was the disastrous global fiscal downturn. The impacts of the past three years have affected the way we view our roles in local government. Despite those fiscal challenges when it became necessary to ask our community to support the core services we also received town meeting approval to adjust the LD-1 limits and were supported by those who voted.”

“The proposed budget attempts to re-set the cost of doing local business and it represents a strong belief to give back to the taxpayers when and where possible,” Berkowitz stated. “This comes from the savings that we have achieved in the past year and had we not moved to do so, this budget proposal would be about $225,000 higher than it is. We hope this savings will continue going forward.”

The town manager then reviewed “the critical elements” that make up the proposed budget.

Berkowitz explained that, “in the most basic terms, a budget should show both revenues and expenses and the shortfall of those revenues is made up through taxes.”

“The town’s revenue picture has been fairly steady despite past state government reductions in local roads, general revenue sharing and the like,” Berkowitz said. “These are calculated and will be adjusted over the next several months so that we have the most current numbers going in to the (June) town meeting.”

Revenue projection $346,000 lower than last year

The Town of Bridgton’s revenue projection for FY 2013 is approximately $2,035,563, or about $345,946 lower than FY 2012, said Berkowitz.

“This, in part, results from changes in those state funded categories as well as a reduction of the use of the town’s surplus by a significant amount,” he said. “From FY 2012 the amount we are estimating to use to reduce taxes is $25,000 or a reduction of over $350,000 which came from surplus. This also has a second benefit in that the town will maintain a healthy undesignated fund balance or surplus.”

“We are attempting to wean ourselves off (using) surplus,” Berkowitz explained.

The town should be maintaining between 15% and 20% of its operating expenses as surplus, the town manager said, which would equate to two to three months of operational cash equivalent.

“Our estimates are that we will have about $2.5 million on the books,” said Berkowitz. “Other material revenues that could affect our tax rate include those funds that come from motor vehicle registrations, general operations such as building permits and the transfer station. We have incorporated these lower numbers as a conservative approach to revenues and are also planning on using very little surplus to lower taxes.”

Expenditures

The proposed budget is $14,720,844, or $92,997 less than FY 2012, Berkowitz stated. This does not include the two enterprise funds — Salmon Point Campground and the Sewer System — that are self-sustaining.

Health Insurance is projected to come in at $342,811 in FY 2013, or $131,081 lower than in FY 2012, due to a reduction in the number of full-time employees and changes in the insurance itself, according to Berkowitz.

Dispatching for FY 2013 is projected to cost the town $132,598, or $85,299 less than in FY 2012, due to switching dispatching services to Cumberland County.

“The FY 2013 budget does not reduce any core services,” Berkowitz stated. “It addresses anticipated increased general assistance expenses especially related to fuel and assures that the Public Safety Department’s support services are properly addressed. The compensation (budget) line items also reflect a 3% increase for personnel who agreed to forgo increases to help during the toughest times. It also reflects an increase in each full-time person’s co-pays for the health insurance program.”

Other factors impacting tax rate

The town manager pointed out that there are other factors “that may have factors to the final (property) tax rate for Bridgton”:

• Property, casualty and liability insurances “have been increasing slightly which mirrors what has been happening nationwide,” Berkowitz said.

• School Administrative District 61 “faces significant challenges as a result of the Essential Program and Services legislation and is likely to receive less state funding in FY 2013,” said Berkowitz. “The alternative to making up the difference locally would be to cut into their curriculum which will have prolonged impacts to the quality of education and the future workforce capabilities of those students.”

• “Any adjustments to our capital investments and reserves schedule may save some funds in the short run but will likely then contribute to a borrowing of funds to ‘catch up’ later on,” Town Manager Berkowitz explained.

• “We are currently down to three more annual payments of about $175,000 each,” said Berkowitz. “Our debt is very low and the current thinking is to avoid debt except when it may make sense and save dollars!”

• The town manager said that, as the State of Maine continues to close its budget deficits “there may be a downshifting of additional costs to municipalities.” “We will continue to watch and through MMA (Maine Municipal Association), participate in the legislative process,” Berkowitz said.

Town-wide property revaluation?

“Our property values are holding and we are actually seeing an increase in the number of building permits for new housing,” the town manager said. “The sales assessment ratio is holding despite the fact that the last several years have proven to be challenging,” said Berkowitz. “However, it is time to begin setting aside funds so that a full town revaluation could occur in FY 2015 or FY 2016 and at an estimated cost of about $200,000. To avoid the full impact of that amount in the one budget year that it would occur, we should begin setting aside funds annually. If we set aside $50,000 each year we would be in good shape and the impact to the tax rate would be about $.05. The timing of this fits with general assessing practices of conducting a town wide revaluation once every 10 years.”

Projected property tax rate

The town manager explained that he had calculated the projected property tax rate before overlay and exemption adjustments.

“Our projections are just that — the best estimate at this point in time,” Berkowitz said. “While this is subject to further review by the Board of Selectmen and the Budget Advisory Committee we see the Town side of the tax rate increasing to about $4.04 and the overall tax rate presuming no change in the SAD 61 tax assessment, going from $12.79 to $12.89, or about 1%. If we set aside funds for the revaluation then this would increase by the nickel. We currently are at $12.70.”

Looking ahead

“One area that we are currently reviewing is that of the transfer station and the recycling efforts thus far,” Town Manager Berkowitz said. “Before the selectmen is a recommendation by the Recycling Committee to emphasize the need to recycle more and reduce our solid waste. This is at the preliminary stage and it would be too early to predict any outcomes or impacts to the expense of the town and the affect it might have on our tax rate. What is known is that the cost to dispose of solid waste, our trash, continues to go up about 3% to 4% per year due to energy charges and the like.”

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