UPDATE: Tuesday, Mar. 27, 10:30 p.m.–Below is the live blog from the Board of Finance Public Hearing on the Board of Selectmen’s proposed FY’19 Budget for town operations, that took place Tuesday evening. It has been updated with some information provided after the meeting’s conclusion.
First Selectwoman Lynne Vanderslice presented a proposed budget with a 0.88% increase.
Even fewer people attended tonight’s meeting than showed up for the Board of Education hearing last night. There were 30-35 people in the audience, and many of them were there to speak on behalf of the Wilton Library. In fact, the majority of the comments made this evening by members of the public had to do with the alternative way the BOS has proposed to fund the Library. After the Library made a budget request for a $50,000 budget increase in February, the selectmen brainstormed what they called a “creative” way to answer that request. They issued a challenge to Library officials, offering a “matching challenge grant” of $25,000 if the Library board could fundraise the other $25,000.
At last night’s public hearing, most speakers appealed to the Board of Finance to consider reinstating the Library’s budget request as a straightforward request. They made the case for why such a challenge grant would be a very tough sell and a hardship on the Library. Board president Michelle Klink even noted that because of the way the Library budgets, such a challenge would hamper the Library from being able to remain open on Sundays and late at night, and from being able to continue to provide the level of services the public requires.
Town officials, on the other hand, said that they thought a challenge grant that aimed to get personal donations would appeal to members of the public in light of tax law changes. Because state and local real estate taxes will not be deductible but personal donations will be, officials believe residents would prefer to fund the Library through increasing personal donations rather than through an increase in taxes.
The details of what many commenters said appears lower in this recap.
Several of the supporters of the Library who came to the meeting to ask town officials to restore a straightforward grant request, rather than the challenge matching grant approved by the Bd. of Selectmen
ORIGINAL STORY–We’re about to start tonight’s public hearing for the proposed FY’19 town budget, presented by First Selectwoman Lynne Vanderslice on behalf of the Board of Selectmen.
7:31 pm, Bd. of Finance chair Jeffrey Rutishauser is giving the introduction of the town’s financial situation and what is impacting the budget for fiscal year 2019.
“Prior to the Mill Rate deliberations, Total Funds Requested for both town and school budgets is up by about $3.05 million, or a 2.56% increase over last year.
“On the Revenue side, the Grand List is up 65 Basis Points over last year. What this means is that we had an additional $718,000 of tax revenue due to Grand List Growth to offset the rise in budget expenses.
“That means that we have a Budget Deficit of $2.33 million, or 1.95% of the budget. This deficit can be closed by budget cuts, tax increases or a combination of both.
“This year, the Board of Education is requesting an increase of $1.8 million, which is a 2.24% increase over last year’s budget amount. The BOE budget reflects the continued decline of enrollment that is similar to surrounding towns.
“The Board of Selectmen is requesting an increase of $293,000, or 0.88% over last year’s budget. We are grateful to the efforts of the Board of Selectmen for coming in well below the BOF Guidance target of 1.5%.
“Tax Relief for the Elderly and Disabled will be increased by $50,000 to a total of $1.15 million but this increase is not reflected in these numbers today. The increase will be submitted to the Town Meeting in May as part of the overall budget.”
Rutishauser says the BOF is grateful to the BOS for coming in under the 1.5% recommended guidance, at a 0.88% increase. He has no similar praise for the BOE.
“The General Fund Balance, essentially an accumulation of past budgetary savings and one-time “windfalls” – will be set at 10% of the Operating Budget.
“This reserve is required by Moody’s for the Town to maintain its AAA rating, enabling the Town to borrow money at the lowest interest rate possible.
“Other highlights include a solid performance of the Pension Fund investments so that the Pension Plan is approximately 96% funded, leaving a net liability of $4.1 million
“Other Non-Tax Revenues are down by $287,000, due to the continued decline in municipal and educational aid from the state.
“Debt Service is down by over $845,000 , a decrease of 7.2% from last year as fewer bonds were issued than were retired
“And Moody’s, a major bond rating agency, reaffirmed Wilton’s Triple-A rating on the most recent bond offering last February.”
The BOF considers all four things, including voters’ views expressed at the hearings and direct communications with the BOF. Let the BOF know what your thoughts are on the proposed budgets.
“As to the last point, the Board of Finance assesses the resources and financial condition of the Town, including our determination of revenue sustainability.”
“As to assessing the levels of debt, we need to recognize the significant increase in debt service, primarily due to the Miller-Driscoll redevelopment project. At this point, we have issued all of the bonds to finance the redevelopment of Miller-Driscoll and in this coming year, we will see debt service drop for the first time in five years.
“As mentioned before, maintaining a AAA rating from Moody’s is a top priority of the town. To do that, we are required to maintain at least 10% of annual operating expenses as reserves in the General Fund. This required reserve amount is $12.9 million, and is generally invested in investment grade short and intermediate term securities.
“In addition, we monitor the unfunded pension liability. After a few years of strong investment performance, the pension plan is 96% funded.
“As to Operating Expense, we evaluate budget requests relative to prior years. We focus heavily on staffing efficiency and headcount control, particularly in organizations that are changing in size like the school system.”
The next slides tell the story of the town’s financial situation:
“At the top you can see the major components of the operating budget, totaling $129.2 million, a 1.0% increase over the current year.
Offsetting these budget expenditures are two items:
- A $4.5 million contribution from non-Tax revenue and
- a $2.6 million drawdown of the Fund Balance in excess of the necessary reserve level.
This reduces the amount needed to be funded down to $122.1 million, a 2.56% increase over last year.
At the top of this page (above) we see the figures carrying over from the prior page. Here’s the $122.1 Million FY19 Budget request, up 2.56 % over last year.
Next we see the impact of the Grand List that provides an additional $718,000 using the current mill rate. So if we didn’t change the mill rate, we would be $2.33 million short between our budget requests and available financial resources.
So that is how we come to the $2.33 million shortfall. At this point, there are only two ways to close this gap – budget cuts, tax increases (essentially raising the mill rate) or a combination of these two.
This chart assumes no budget cuts so that the entire shortfall is rolled into a tax increase, raising the Mill Rate by 1.95% over last year–or 1.99% if we include the increase to the Tax Relief for Elderly and Disabled residents.
Future dates in the budget process:
On April 3 and 4 the Board of Finance will meet for the deliberations on the budget and the setting of the mill rate.
Finally, we will hold the Annual Town Meeting on Tuesday, May 1 where the Unified Operating Budget and Bonded Capital projects are presented to the citizens of Wilton for their vote. There is an additional voting day on Saturday, May 5 as well for those who could not attend the ATM.
He introduces First Selectwoman Lynne Vanderslice, who will present the proposed Town Budget for FY’19.
Good Evening and thank you for coming. For those watching at home, thank you for viewing.
This evening I am presenting the BOS budget on behalf of my fellow Board members: Second Selectman Dave Clune, Selectwoman Lori Bufano, Selectman Mike Kaelin and Selectwoman Deb McFadden.
I would like to thank the Wilton Department Heads for their efforts in preparing this budget. And thank to them and all Town employees for your service to the community.
Many employees have been put to the test over the last few months and as always they rose to the occasion.
For the last 28 months, this BOS has been focused on providing quality services at the lowest possible cost.
• Actual results have consistently been under budget:
• $1 million under budget in FY2016
• $.450 million under budget in FY2017
• Forecasted to be $.500 million under budget in the current fiscal year.
In developing the FY2019 budget, we were mindful that the Town and the State have still not recovered from the recession. There remains uncertainty as to whether and when prior Income levels and housing values will return.
Eight years out:
• Earnings were only up 1.1% for residents with an AGI of less than $200,000. Those residents more than half of residential taxpayers.
• Earnings for those with an AGI greater than $200,000 was still down 16%.
• In total residents, were earning $200 million less than in 2007
• The 2017 Average Sales Price from Single family homes is down 17.5% vs 2007. At the time of the 2012 revaluation, the decline in value for single family homes was 20% so we are not seeing significant improvement in prices
We are mindful that high earning residents are leaving Wilton and surrounding Fairfield County communities and the State
In Calendar Year 2016, there was a net loss of 12,700 federal tax returns with a Connecticut address. 2,473 of those net losses had Fairfield County addresses
Residents who are leaving have higher earnings than those coming into the State and Fairfield County. In Calendar Year 2016, there was a net loss of $2.7 billion in Statewide Adjusted Gross Income. $1.5 billion of that loss occurred in Fairfield County
So where are the high earners going? No surprise, they are going to states with no income tax and or warm weather….. you see Florida, California and Texas as the top states for the top earners.
We all know they are leaving, in part, because of the State’s financial issues:
Extraordinary high debt, much of driven by years of unfunded pension.
Accounting to the Legislature’s Commission on Fiscal Stability, Liabilities are stated as in excess of $80 billion and are growing, but realistically the amount is more than $100 billion and growing
So mindful of all I have presented, the BOS is requesting a budget of $33.5 million, which is $293,000 or .88% higher than last year’s budget
This request, plus the prior two budgets submitted by this board, represent an annual average increase of 1.1%
Despite increasing wages and medical costs we achieved this budget due to several cost reduction or cost avoidance measures including:
- Consolidation of DPW Director and Facilities Director positions
- Shared CFO with Board of Education
- Elimination of one police officer mid-year
- Reduction in required OPEB funding due to the funds high funding level, which is the highest in the state
- Favorable changes in employee benefits and employee contributions achieved through contract negotiations
- Creativity with the Town grant to encourage direct donations to the WLA as the board recognized the impact of the changes in the tax law
- Further reduction in the Trackside Teen Center grant as they move to financial independence
As you can see from this chart, Medical costs are the biggest driver of the increase, up $263,000 or 7.4%. Despite the positive steps we have taken, medical costs continue to be a challenge. This year we are looking at alternatives to our current self funded plan.
Despite wage increases which ranged from 2 to 2.25%, wages are only up $84,000 or .596% because of reductions in the labor force.
As you can see on this Headcount slide, as of this budget we have eliminated 4 positions. Next year we will have eliminated 4.5 as we realize the full reduction of this year’s elimination of one police officer mid year.
We are also thinking outside the box, as we address outside changes which impact our residents. As you may know, the Town funds approximately 75% of the Library’s operating costs through an annual grant.
• Prior to the new tax law, residents were indifferent to this funding mechanism versus direct funding through a personal contribution, as both forms of funding were deductible on their federal tax return.
• Of course with the change in the tax law, that may not longer be the case, as for the majority of residents, who previously were able to fully deduct property taxes or a portion there of, they are no longer eligible for deduction.
• Without the ability to deduct
- The proposed grant will have a $2.778 million cost to the all taxpayers when paid through property taxes.
- If paid through personal contributions, the cost could be as low as $2.15 million assuming all residential taxpayers itemize and receive the deduction
The difference of $600, 000 is significant to our community. Those additional monies could otherwise be available to put back into Wilton’s economy through spending or through donations to non profits like the Library.
Therefore the BOS wants to encourage residents to donate to the Library to help reduce the amount that must be paid through taxes.
The challenge grant and the associated communications are the beginning of that effort by the Board of Selectmen.
Included in our budget is just under $1.2 million in operating capital. We attempt to manage our purchases so that the amount remains fairly consistent from year to year. This slide and the next two are the details of that five year plan.
You will see typical items, police cars, computer software and hardware, dump trucks and mowers and one-time items like the document management software and office equipment.
I’m happy to answer any questions.
Steve Hudspeth: I support this budget, thank you for the work that’s gone into it. Questions: Glad to hear you’re doing the paving program. It’s been so critical. Our DPW and Parks and Rec people, our Emergency Services people, what they’ve done, we want to express our appreciation to them. Behind them are the people working in town hall to facilitate it all.
I’m concerned about the reduction in a police officer, it’s an unusual thing to do at this time. And what are the thoughts about renovating the Police Station? We see the need, what’s being done to advance that issues?
Vanderslice: Elimination of an officer was discussed with the Police Commission. It’s something Chief John Lynch and the Commission are comfortable with.
Looking at the building, what are the trends and where are we going to go. John feels staffing will never go beyond what we have had, and technology allows us to go down. We would never do this if we didn’t have John’s support.
For the building, it has transitioned from a study group looking at the entire Town Hall Campus. A smaller group did a study, and now we’ve expanded the committee and it’s moved into a Building Committee phase. It has taken us a longer time, but that’s not a bad thing. The thought is that the administrative offices will move into the unfinished space. We have bonded money to get that done. That will allow us to move some people into town hall out of the annex. We would do an addition onto the police station, there is already a concept of how it would work.
All those buildings are in bad shape. My office, the area where I am is closed as we do some work on our ducts and ceiling tiles. We are doing that through the whole building. We continue to pour money into Town Hall and Annex unless we address underlying issues. The plan is that the footprint will be smaller than it is today, when it’s done.
Judy Zucker: Do we have a five year capital plan?
Vanderslice: It hasn’t been approved yet by the BOS, that’s happening Monday, we don’t approve it and send to the BOF until April. That will be brought to the Town Meeting.
Rob Sanders: I have my Library hat on. Thanks to all, we have amazing volunteers that make all the institutions in town run.
I am a selectman’s representative to the Library board. Tonight I come with a comment that the scenario that is proposed for the Library to generate funds, leaves me with a concern. This is setting up a scenario in a world we’re trying to figure out tax policy, and we don’t fully understand the impact on volunteer giving and cash flow of these organizations. Yes the town supports 75% and the other 25% is given by residents through volunteer giving.
I think if the citizens were presented with the question of, will you support the Library through taxes or volunteer giving? Volunteer giving supports 600 programs. That citizens are “indifferent” surprises me. If the question was put to the town, perhaps they’d be less indifferent. As citizens we all benefit from the Library. There is no fairer way to support the Library than through taxes. Every citizen benefits from the Library. One of the most broad based institutions in town, for the cohesiveness of the town.
As your BOS representative, I asked what we’ve done to control costs in the Library:
- Solar panels, $17,000 savings per year
- LED lights changes
- switched HVAC contractors
- renegotiated refuse collection
- selling valuable books to generate funds
The Library is constantly looking for ways to squeeze pennies out every year. WE are combining positions to reduce headcount. The budget request was solely based on increase on 2% wage increase and health care. The rest are all donated dollars.
We do want to encourage residents to donate. But the new tax scenario, may result in significantly reduced donations to all non-profits. Everyone in the room is facing limitations on deduction and individual giving. The town needs to understand that the Library is our premier institution of the town. I would encourage the BOF to restore the Library funding.
Vanderslice: I agree, if we eliminate funding, I don’t know if residents will step up. A significant portion of the town does not donate. We’re dealing with the reality of where we are. We’re concerned about the impact of the federal tax law. But we hope through this challenge grant it opens people’s eyes to understand.
Tom Curtin: The BoS rejection of a modest increase for the Library raises a question of whether it is a financial burden or one of our most valuable assets.
Your vision is about a vibrant town, a vibrant Wilton Center.
Our downtown is not vibrant. Where are the amenities for all ages? the most vibrant place for Wilton and the place that provides for gathering for all is the Library.
Look at 40 things we love, number 1 is schools, number 2 is the Library.
What is driving people to the town is the Library.
Michelle Klink: Library Board president. I’m here addressing the additional $50,000 that was requested and the town’s offer of a challenge grant. The increase the Library is requesting is to cover primarily salary increases and health insurance. The Library presented a bare bones budget, every opportunity for cost savings. It’s our understanding the town has earmarked the $25,000, and we would earn that if we could solicit $25,000. That is over the $750,000 we already have to raise.
We budget on cash basis, and can’t count that. We would have to take immediate cost cutting measures–closing earlier during the week, closing Sundays, not provide extra hours during exam week, cutting innovation station program. It would have an effect on revenue earning–room rentals, etc.
Donors are not supportive of funding operating dollars unless you are in a capital fundraising, and we’re not.
We understand you’re trying to send a message to residents that direct donations will benefit the town organizations and get deductions.
This challenge grant is the wrong mechanism. Allow us to help educate the public; work with us to educate the public. Instead of the uncertainty of a challenge grant, which would inhibit us from operating, we request that you fund the budget as requested.
Vanderslice: If we reinstate the money, and we educate the public, and you raise the money, above the $50,000. Would you return the money we gave you
Klink: we have a hard enough time to raise the money we do. We don’t know if we can raise the additional funds in the current climate. We can’t operate without it.
Nick Davatzes: Everybody thinks it’s a public library. When I found out that 25% of the funds had to be fundraised, I was astounded.
How do we know what people will do with this tax law? Contributions are going to be limited, with deductions you can take.
The town has a right to be concerned about costs. But it should also be deciding to force where it wants to make its investments. If you talk to real estate agents, the Library is the second thing they’re selling. Think about the priorities you’re supporting.
Do a survey… Do people think it’s a public library?
I don’t agree the tax code is going to allow you to do what you think it’s going to do. NO one knows what’s going to happen in terms of the tax law.
The town people think it’s a public library. Only recently has the Library tried to educate the public. What is Wilton without a good library?
Elaine Tai-Lauria: Resident and executive director of the Library. A few days ago we got an email from a former resident. My husband’s work moved us to Florida. The Library was such a big part of our lives in Wilton. You have brought so many great programs, the Human Library program gives me goosebumps.”
We frequently hear from people like this. The program she said had 200 enthusiastic visitors. Immediately after, we rearranged chairs for 150 for the classical performance. 1100 people stepped through our doors on Saturday.
Almost 1,000 programs the Library brings to the community. Last Saturday we enriched our town with world class events. We’re told by restaurants they love when we have programs because our patrons go to them. This is an ignored fact–we also contribute to the local economy.
For a community that’s under 19,000, our library attracts over a quarter million people annually. Our programs cater to all ages. They’re made possible by frequent and vigorous fundraising.
We cannot and should not be an outdated library. We must strive to remain a modern, vibrant, active oasis of information, serving the community and open when they need us.
$50,000 may not seem like a lot but for us it is significant.
Allow us to use privately raised funds to support programs and books and things to fill the libraries. Help us sustain what we have built rather than begin a process of slow deflation.
Pat Hessel: I’m an elder. I’ve lived here since 1970. The Library was the reason I came to Wilton with my family. I went to four towns: Darien, New Canaan, Westport, and Wilton. to talk to the Librarian. It wasn’t the schools, Kiwanis park, Merwin Meadows, the church, but the people themselves. This is what Wilton had. I found out from the Librarian. She told me about the patrons, the town, she knew Wilton, and made it come alive to me.
All these people believe in the Library. I’m grateful for the elderly tax relief, but I won’t take it, I want our Library to continue to grow. I want my taxes to go to the Library. The staff that cares about the books, the children. Let’s honor our library and its people, most of all the people who use it.
Maybe more people will come to Wilton because of our services and the people, which is reflected in the Library. The children have independence there. It’s the one place they can be who they are.
Jim McSweeney: I moved here in 1975. I have a question for the BOF: How is the total budget arrived at?
Michael Kaelin: Framing this debate as a for the Library or against the Library, I’m shocked that the BOS decision has been framed as one that I’m against the Library. The Library is in my will, no one has given more than me to the library in this room (except for Nick Davatzes).
The state is in terrible financial situations, and it’s going to trickle down to us. We’re going to have to do something different.
Given that real estate taxes aren’t deductible and charitable donations are, it’s a creative idea.
I know for a fact it’s not going to put the Library at risk, because I know the budget as well as you. Including how you raise money.
What I wanted to accomplish by this proposal was to get everybody in town to think differently, to try things differently. Why can’t we innovate and experiment and work together instead of making it you’re for the Library or against the Library, because that’s the surest way to turn people against the Library.
Meeting ends at 9 p.m.