Finance board sends voters 1.8% tax hike
A 1.8% tax increase to support a $144-million proposed 2018-19 budget — with spending increases of about 2.5% for both schools and town — will be sent to voters for approval in May.
On a series of unanimous votes Monday, April 2, the Board of Finance trimmed the school spending increase to 2.55%, approved the town departments and roadwork budget at the 2.49% increase sought by the selectmen, and proposed pulling $1.6 million from the town’s $14.5-million surplus fund balance for use as non-tax revenue to help hold the mill rate down.
On Tuesday, the finance board approved a separate $3,861,000 capital budget for larger projects and purchases.
“We wanted to keep taxes under 2%,” finance board chairman Dave Ulmer said Monday night. “It’s a tough year.”
“I think the finance board did a good job,” First Selectman Rudy Marconi said after the voting Monday. “A ‘two-and-a-half’ for the Board of Selectmen and the Board of Education is a good increase.”
School board chairwoman Frances Walton seemed less enthusiastic.
“The Board of Education adopted and submitted a budget which reflected the needs of our students, and our contractual obligations,” Walton said in an email Tuesday morning. “In an effort to contain costs, we have been reviewing and revising our health care benefits. The board will need to consider every aspect of the educational budget to meet the BOF (Board of Finance) target and sustain our great schools. We have scheduled a special meeting on April 16.”
Walton said the public meeting on April 16 would be at 7:30 in the school board’s meeting room in the Town Hall annex, although there may be a closed-door executive session at 6.
The $95,000,000 school budget approved by the finance board for next year is up $2,366,000 from the current year’s $92,635,000 budget. That 2.55% increase is slightly more than the 2.5% school increase suggested by the selectmen in their non-binding recommendation.
The size of the finance board’s reduction to the school budget increase can be viewed as either about $1.5 million or a little over $1 million, depending on which version of the school budget is used as the starting point.
The school board originally approved a $96,555,000 budget request that would have meant a $3,922,000, or 4.23%, increase. But the school administration revised that down twice — first to $96,442,000, for a 4.09% increase, as described at last week’s public hearing, and then to $96,090,000, for a $3,456,000, or 3.73%, increase.
The finance board reduction is about $1,555,000 from the $96,555,000 budget increase the school board initially voted to approve. But starting with the school administration’s final revised budget of $96,090,000, with a 3.73% increase, the finance board’s $95,000,000 budget represents a $1,090,000 reduction.
Not a ‘budget’ cut
In the end, finance board member Dick Moccia emphasized, the proposed budget gives the schools $2,366,000, or 2.55%, more to spend than they have this year.
“One point for the record,” Moccia said Monday. “We did not cut the Board of Education budget — their request was cut, not their budget.”
Finance board member Sean Connelly recalled that last year board members had gotten “70 or 75 letters” — most of them “strong in support” of the school budget.
“That has not been the case this year,” Connelly said.
Ulmer noted that school enrollment continues to decline. It’s expected to fall by 74 students from this year’s 4,912 to a projected 4,838 next year.
“We do have declining enrollment, there’s no doubt about that,” Ulmer said. “Increased spending is problematic.”
The school board’s budget presentation contains a chart showing per-pupil spending in the “DRG-A towns” — affluent Fairfield County suburbs with which the state groups Ridgefield for comparisons. It shows per-pupil spending ranging from $23,439 in Redding to $19,727 in Darien — with Ridgefield trailing all eight other towns at $17,653. The average cost per pupil in the nine towns shows as $20,410.
Despite the higher spending in the comparison towns, Ulmer said, measures like tests scores or college acceptances show the school system’s students performing as well as their peers in similar suburban towns.
“There’s very little significant difference between the results we get and the results in Greenwich or Westport,” Ulmer said.
“You do have a great success rate,” Moccia told the delegation of six school board members at the meeting. “And people move to town here because of the education.
“But we also want to keep the people who live here now,” he said.
The selectmen’s budget for town departments — police, fire, highway, parks and recreation, town administration — is $36,484,000, which works out to a 2.62% increase. But the selectmen’s budget also contains a separate allocation for roadwork and infrastructure projects under the Americans with Disabilities Act. The roads and infrastructure allocation would remain flat at the same $1,840,000 as this year — and with it included, the selectmen’s overall town increase works out to 2.49%.
Finance board members were impressed with the job Marconi and the selectman had done, which included the elimination of all staff increases — except for one transition from part-time to full-time for an employee in the planning and zoning office.
“We looked at this,” Connelly said of the proposed town spending. “It just tracked like you did good work to have a good budget.”
“The way it was put together,” said finance board member Jessica Mancini, “you had the trends, you had the data.”
“Anything you want to increase?” joked selectman Bob Hebert.
Elderly tax break
The finance board and selectmen did discuss — without taking any action — the request by the president of the senior citizens group the OWLS to increase the tax break given to senior citizens.
Currently taxpayers over age 65 may take $1,048 off their Ridgefield property taxes, and Dr. John Fisher of the Owls had asked that the amount be raised to $1,200.
Ulmer said the elderly tax relief program currently costs the town’s other taxpayers about $1,600,000 a year.
“To raise it $50 would be another $100,000,” said Marconi.
He also mentioned Fisher’s two other requests on behalf of the OWLS. One was a “tax freeze” that would protect taxpayers from further increases once they reach age 75. The other was an increase from $55,000 to $65,000 in the level of annual income that serves as the cut-off point for the town’s “tax deferment” program — people making less than that may defer their taxes to the town year after year, and taxes will be collected when the house is eventually sold because the person either moved or died.
The proposal to raise the $1,048 tax break that all seniors receive at age 65 got the most discussion, though Ulmer noted that this was something the Board of Selectmen, not the Board of Finance, would act on.
“Maybe you should think about indexing it,” Ulmer said to the selectmen.
“It’s been a good five, six, seven years since we increased it,” Marconi admitted.
The town’s fund balance — currently about $14.5 million — is an accumulation from past years’ surpluses that functions a little like a family’s savings account.
Most years the finance board puts some money from the fund balance into the budget as revenue — on the theory of returning the money to the taxpayers.
The board has a policy guideline to keep the fund balance at about 8% to 9% of the annual budget.
The thought is that it’s good to have some financial cushion, but if the fund balance grows too large the justification for tax increases is diminished — why raise taxes on people while sitting on a fat surplus?
The current year’s budget uses $1.8 million from the fund balance as revenue. The finance board decided to use $1.6 million from the fund balance as revenue next year.
That use of $1.6 million would lower the fund balance from 10.35% to 9.2% of the budget.
“It leaves it slightly over our guideline,” Ulmer said.
Being cautious makes sense, Ulmer urged, in view of all the uncertainties surrounding the state’s finances — and a likely continuing decline in grants the state provides to various town programs.
Annual Town Meeting
The budget will next be discussed — and some aspects of it voted on — at the Annual Town Meeting on Monday, May 7, at 7:30 in the East Ridge Middle School auditorium. The annual meeting is usually at the Ridgefield Playhouse, and Marconi made a point of mentioning the changed location at the March 26 public hearing on the budget.
In addition to voting on capital projects of up to $100,000, citizens at the annual meeting will set the date, hours and place of referendum voting on the operating budgets and more expensive capital items.
Both Ulmer and Marconi spoke of this year’s budget and tax decisions as having added significance for many in town as a result of the federal government’s new limit on the amount federal income taxpayers can deduct for state and local taxes — called SALT deductions.
While federal tax rates were lowered, a typical Ridgefield family might have had $20,000 in “SALT” deductions in the past, and that will now be limited to $10,000. If they’re in the 25% tax bracket, Marconi said, that amounts to $2,500 in taxes.
“People are going to be upset about that,” Marconi said.