Smoke and Mirrors: A Deeper Dive Into Budget Numbers

With few exceptions, the town’s annual budget-setting process involves the same steps each year: the Board of Finance provides guidance on what budget increase over the current year’s budget they’d find acceptable for the following year. Town and school leaders work with their respective department heads to prepare a budget within those parameters. After a series of lengthy reviews and public hearings, an official proposed budget is eventually brought to town residents and property owners who vote on whether to adopt that budget. That’s an overly simplified explanation, but it’s the basic process.

Last November, the BOF gave its guidance for the FY 2026 budget, recommending a 3% budget increase over the current year for the Board of Selectmen.

In two meetings held earlier this week, First Selectman Toni Boucher and Town Administrator Matt Knickerbocker presented a preliminary FY 2026 budget proposal to the Board of Selectmen to begin the formal review of the budget numbers.

Typically, the usual way the budget proposal is made is by calculating the operating expenses the town will need and the operating capital the town will need for the next year, combining those into one number and comparing the total against the same calculation that was made the year before to figure out the year-over-year increase.

This week, Boucher and Knickerbocker presented a budget but deviated from the usual way the town has always calculated the budget. Instead of just combining their operating expenses and operating capital needs — which would have worked out to a 10.39% increase over FY 2025 — they used an alternative way, deciding to reduce the debt service by $1.4 million and factor that reduction into the calculation, coming up with a 2.99% increase.

GOOD Morning Wilton has published two articles detailing the meetings and how other town officials — namely Selectwoman Kim Healy and Board of Finance Chair Matt Raimondi — challenged Boucher and Knickerbocker.

• Boucher’s Attempt to Meet BOF Guidance Can’t Hide 10.39% Budget Increase (Feb. 11, 2025)
• 10.39% vs. 2.99% Increase: Boucher & Knickerbocker Defend FY’26 Budget Proposal with Questionable Debt Service Reductions (Feb. 13, 2025)

As part of our reporting, we emailed several questions to Boucher and Knickerbocker late Wednesday afternoon about what they had done for their budget proposal and why. Knickerbocker responded to our questions on Thursday afternoon. That email exchange is presented below as a Q&A. In those responses, Knickerbocker justified using the debt service to get to the 2.99% as an “allowable and appropriate” method and that it was “important to respond to the BOF guidance in a positive way.”

When we asked what they would say to people who felt that how they presented their numbers was misleading, Knickerbocker answered, “We believe very strongly that this is more transparent, not less.”

GOOD Morning Wilton took a closer look at the financials they presented. Their preliminary budget, dated Feb. 3, 2025, is available to view in its entirety on the town website. Below is the budget overview on page 8 of the budget document.

Here are some important things to note:

1. The numbers don’t add up, and the information is presented in a way that isn’t entirely straightforward.

The numbers at the bottom of the overview seem to present a comparison between (A) the 10.39% budget increase calculated the usual way with just operating expenses and capital, and (B) a 2.99% budget increase calculated the alternative way by factoring in debt service to meet the BOF guidance.

But looking closely at lines (A) and (B), while (A) is straightforward with operating expenses and operating capital, (B) doesn’t just add in debt service as Knickerbocker and Boucher intimated — it also omits operating capital. That’s $2.2 million that wasn’t factored in. Comparing the two isn’t a fair comparison.

The math doesn’t add up either. If you add debt service (the middle line) to line (A), it doesn’t equal line (B).

2. What happens when you use the actual numbers?

If the calculations had been done so that you could compare the budget increases between the usual way and the alternative way by factoring in debt service and keeping capital in, the resulting budget increase would be 5.01% — not 2.99%, or a difference of two percentage points.

Using the actual numbers in the calculations (i.e. keeping capital in) the budget, the actual budget increase would be 5.01%, which doesn’t meet the BOF guidance.

Interestingly, those numbers are at the top of the budget overview. However, they were not discussed, highlighted or explained during the two budget meetings and Knickerbocker did not draw attention to them in the Q&A with GMW.

Making things clearer

Despite Knickerbocker saying it was “important to respond …  in a positive way” and that numbers were presented in a way that is “more transparent, not less,” the 2.99% figure actually omits $2.2 million of operating capital altogether.

Without including operating capital in that number, the budget does not meet the guidance as Knickerbocker and Boucher have suggested. The 2.99% is pretending to be something that it’s not.

More accurately, the 2.99% is an arbitrary number created by adding two elements that are not usually combined, just to get a result that appears to meet the budget guidance.

• 10.39% — The true number as the town usually has calculated guidance and budget increase [Operating Expenses + Operating Capital]
• 2.99% — The arbitrary number people are led to believe meets guidance, which doesn’t include everything that was implied it does [Operating Expenses + Debt Service]
• 5.01% — The actual number that results from the alternative “allowable and appropriate” way chosen to calculate numbers [operating capital + operating expenses + debt service reduction]

Below is GMW‘s unedited email Q&A with Knickerbocker with his answers to questions we posed after this week’s budget review meetings.

Since receiving those answers, GOOD Morning Wilton has asked Knickerbocker to clarify several points outlined in this story, including why it was implied that the budget met guidance, and why operating capital was omitted from the calculation; why it hasn’t been presented in a more straightforward way and why they didn’t specifically explain the differences in calculations and budget increases; and whether presenting it they way they have is fair to residents.

We have not received a response as of publication time and will update accordingly.

Q&A with Matt Knickerbocker

GOOD Morning Wilton: Why did you feel the 2.99% number was important to emphasize in your presentation? 

Matt Knickerbocker: We believe it is important to respond to the guidance issued by the Board of Finance in a positive way. I and our entire town hall staff take that direction seriously. Every member of our team is sensitive the impact our budgets have on taxpayers.

Having recognized that, however, the fact remains that we are challenged with some extraordinary one-time increases this year that make it difficult, if not ultimately impossible (as we are still combing for reductions) to meet the 3% target without resorting to savings in the debt line.  As noted in [Wednesday] night’s BOS meeting, this year, due to the sharp increases in health insurance, minimum wage law, etc. the increase in just wages and benefits alone added 2.81% to the budget, so right from the start we have very limited ability to respond to the need for additional fire fighters, nor the new police radio system (+180,000), nor any of the items recommended by the TSNAP committee. 

And just to be clear, it is completely allowable and appropriate that we show debt reduction in the “town side” of the budget. Regardless of which line it appears on the annual financial report, debt service is a “town” obligation and carries the burden for both “town” and “BOE” facilities.  At the end of the day, what impacts voters the most is not just the budget, but its effect on the mill rate, and no matter where in the financial report we account for it, the debt cost is part of that calculation. Therefore, if we can meet our operational goals and utilize savings in the other line to do so, the taxpayers win.

GMW: Operating budgets typically don’t include the debt service in the calculation or in meeting the BOF guidance. I don’t think we’ve ever seen it presented that way. Why did you present the budget this way when your operating and capital expense increases were really 10.39%?  

Knickerbocker: I hope I covered this adequately above. Please let me know if you have more questions.

GMW: What do you say to people who believe the way you presented numbers was misleading?  

Knickerbocker: We believe very strongly that this is more transparent, not less. Again, all of the major budget lines, BOS, BOE, Capital and Debt, are combined to calculate a mill rate. It is simply unrealistic to expect every one of those components can be “controlled” and held to the same level of increase every year. As we are seeing this year, there are challenges that are beyond our control. We need to use every possible tool we have to maintain essential services but at the same time minimize the impact to taxpayers. Applying the savings in the debt line makes that possible.

GMW: What do you say to the suggestion that you are passing the buck to the BOS members and not making the reductions yourself before bringing a tighter budget to the table?

Knickerbocker: We are not asking the BOS to “do the hard work of deciding what to cut.” Also, this is standard operational procedure. Following the presentations by town staff, it is always the case that the Board of Selectmen deliberate the budget and make their own adjustments. Our operational managers are perfectly capable of crafting budgets that will meet any guidance given to them. However, this year, due to the extraordinary external factors I’ve described above, doing so could negatively impact services that residents expect. Our staff is not “passing the buck”; they are asking for input on priorities.

GMW: Were you surprised by the pushback from Selectwoman Kim Healy?  

Knickerbocker: Not at all, and I would have to respectfully reject the use of the word “pushback.” This is just healthy, robust discussion and debate, part of [the] job all of our elected officials have, and it is most welcome.

GMW: How optimistic are you that the Board [of Selectmen] can reach consensus on specific cuts that will bring you closer to the BOF guidance? 

Knickerbocker: I am very confident that upon conclusion of the process, we will have a budget to submit to the Board of Finance that we agree will meet our community’s needs.

GMW: Where are the areas you see as priorities to keep and where do you think the BOS will have to seek cuts?   

Knickerbocker: Anything and everything that is not subject to a contractual or legal obligation is “on the table.” Prior to submitting this budget to the BOS, our management staff spent a great many hours combing through every one of the thousand or so lines, cutting entries as low as $50 to squeeze costs down.

GMW: I didn’t think that debt service was forecasted to decrease in FY’26. We also thought borrowing was supposed to happen in FY’25, not get pushed to FY’26. What would the impact be from the debt service moves after FY’26? Do you have projections that show the impact on FY’27/beyond?  

Knickerbocker: To be clear, if you recall last year’s budget presentations, our town faces a crisis with regard to its infrastructure, as noted in the two engineering reports on town and school buildings. We have also been very upfront with our strategy, very clearly outlined in all of last year’s budget presentations, that we have debt load “falling off” as older bonds are paid off, and that we would use that additional bonding capacity to address the critically needed physical repairs and upgrades to our schools and town buildings. That new debt was “programmed’ into the FY’26 budget right from the start. All we are doing in this proposal is delaying the sale of new bonds to July, which puts the first principal payments in the following fiscal year. 

Two additional points: this delay would have probably happened anyway, since there is a tremendous amount of planning and engineering work to be done before most of these projects can be started, and little time to get it all approved and put on paper. Secondly, it does not necessarily impact the FY’27 debt figure. Due to other factors, like the fact that older debt continues to fall off over the next several years, we are confident that we can mitigate any impact to FY’27 debt figure.

GMW: Why was borrowing moved to July?  

Knickerbocker: Explained above.

GMW: Isn’t this kicking the can down the road and creating additional problems — and something being done to back into the 2.99% number?  

Knickerbocker: Explained above. I think the main point is that we need to shift our thinking to look at our budgeting and mill rate processes holistically. The tax burden is determined using input with several components, and it is simply not realistic to expect that every one of those components is always going to fit neatly into the target guidance, as we are seeing this year. This is especially true when making cuts to one of those components potentially could result in reductions in important services or amenities that voters rely on.