2003-Annual Town Report - Laserfiche WebLink

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The FY05 estimate also contains no capital Report of the improvement spending. Consideration of FY04 capital Finance Committeeprojects was postponed until the October Town Meeting to see what funds may be available from cer. tified free cash. A total of $261k was committed.In To the Honorable Board of Selectmen the past three fiscal years (including FY04) a total of and the Citizens of the Town of Mashpee: $1.1 m has been appropriated for capital improve. ments. Requests for FY05 amount to over $2.4m.We should not expect funds to be available except for the The Cost of Town Government most immediate needs and decisions again will proba. As a result of conservative fiscal policy and close bly be based on available free cash. cooperation of all elements of town government, the rate of growth of government cost has shown appre- On June 2 2003, at a special town meeting, the ii ciable reduction. A firm adherence to level-funding in town voted to confirm payment of 75% of medical FY2003 and FY 2004 operating expense budgets and insurance for retired employees and their dependents a judicious hiring policy have been much needed con- and to include surviving spouses of retirees in this ben- trols. efit. In the table below, which shows the growth of all employee benefits costs, one can see the initial effect TOTAL APPROVED BUDGETS (1) of the town's vote. The FY05 estimated budget includes $26.7m for salaries, wages,benefits—71%of FY Millions %Increase PopulationiL % Growth the total outlays. 01 33.4 - 13,400 - 02 35.3 5.7 13,918 3.5 COST OF BENEFITS ($000) (4) 03 37.1 5.1 14,079 1.1 04 38.2 3.0 14,057 0 FY05 OS 37.8 (1.0) - _ BENEFIT FY02 FY03 FY04 jgq. County Retirement $913 $954 $1,084 $1,332 The FY05 estimate(3)is computed using only the Medical Insurance $2,408 $2,798 $3,078 $3,448 i level-funded budget requests from all departments and Medicare $253 $266 $266 $271 F assumes debt service remaining essentially level, an Unemployment $15 $15 $60 $60 increase in employee benefits of 15%, and no capital Group Insurance $12 $12 $13 $13 improvement expenditures.Consequently,a very mod- est increase in outlays may be realized. What is not TOTALS $3,061 $4,045 $4,501 $5,124 �j shown in these values is the impact of a budget that lets contractual wage and salary increases continue Stabilization Fund while curtailing expenditures on necessary processes Our stabilization fund continues to be a reason- and equipment. able source of funds to offset potential budget deficits. A healthy stabilization fund is one which is main- If debt service and employee benefits are not tained at about 5% of anticipated town revenues.The considered,then the total operating costs for FY04 are surpluses of recent years have enabled the fund to $28.2m and for FY05 $28.0m. Salaries and wages grow to a level of$3.3m in FY03. Because of severe i, continue to grow in FY05, while direct outlays in reductions in state aid,there was a$1.3m deficit in the materials diminish. In the FY04 budget, department FY04 budget. That has been overcome by judicious expenses totaled approximately $7.1m. In FY05, it is use of free cash,overlay surpluses,and commitment of anticipated expenses will amount to only $6.3m, an $750k from the stabilization fund. The fund is now overall decrease of$800,000. Again,these projections about$2.55m. are based on early estimates and may not prove true, but a negative impact on operations can be envisioned. While a sound management practice in an emer- This relatively small saving can prove costly over gency, the deleterious effect of using the stabilization time:preventive maintenance may be sacrificed result- fund is that there will be less free cash available to ing in equipment and machinery shortages; routine but replenish it in the succeeding year. The revenue out necessary safety inspections may be curtailed; look for FY05 (at this writing in January 2004) con- employee education and training could be under- tinues to be bleak. The best that can be expected is II mined; infrastructure and roadways continue to deteri- level-funded state aid to the town which will probably orate; a broad range of school programs may be result in a similar deficit as in FY04. With no surplus g severelyreduced or eliminated. cash expected from FY04, little if any free cash can be expected to carry over to FY05 at the end of this fiscal 8