RICHMOND — The Finance Board has concluded its preparation of the Fiscal Year 2019-20 budget, and homeowners will be facing another property tax increase.
The $26.3 million proposed spending plan is a 2.5 percent increase over the current year’s budget, and the current mill rate, the tax rate per $1,000 valuation, is $21.36. The proposed mill rate, which could still change slightly, is $22.20. The increase of 3.9 percent is just shy of the 4 percent cap the state imposes on increases in the tax levy. Outgoing finance Director Kelli Russ said the increase was unavoidable.
“The reason we are going to the 4 percent is that there are one-time revenues that are gone, so you have to make that up,” she said. “For example, they budgeted for the sale of property and they budgeted for the use of impact fees and a little bit of fund balance, so when we calculate our total revenues versus our expenses and our increase, we have to make up some of this.”
“This was a tough budget year,” Town Administrator Karen Pinch added. “We can only raise taxes by so much, and of course we’d prefer not to raise them at all. After we pay for the school, debt payments, capital projects, and modest raises, there really isn’t anything left within the cap.”
The town’s contribution to the Chariho school district will increase by $185,299 to $19.8 million, but this time, unlike previous years, Chariho is not the major contributor to the town’s budget increase.
The most important factor impacting the new budget, Russ said, involves capital transfers. The proposed capital budget is $755,494, which, this year, will be funded by three sources: leftover bond proceeds, the capital reserve for buildings and maintenance and a transfer from the general fund. In previous years, the capital budget has been funded by bond issues, increasing the town’s debt.
“What happened is, last year, we didn’t fund any of our capital with tax dollars,” she said. “This year, we’re going to fund $298,416 as a budgeted transfer to capital, which is 46.02 percent of the [budget] increase…. Even if our capital budget was somewhat level-funded last year, all of it was paid with debt or bond proceeds. None of it was paid from the general fund. This year, we’re funding a good portion of it from the general fund as well, so therefore it’s new tax dollars.”
Town Council Vice President Richard Nassaney praised Russ for discovering and rectifying the procedural issue.
“She’s brought to light stuff that needed to be fixed, that we had no idea wasn’t fixed,” he said. “It’s going to be a tough tax season but we have to implement a fix so that the longevity of the financial stability of the town will be there.”
The town’s other major expenditures are the Police Department and the Department of Public Works.
The most significant component of the police budget is salaries, however contract negotiations are ongoing, so that amount, and therefore, the total police budget, has not been finalized. It is expected that the current police budget of $1.9 million will increase by approximately $73,000.
The Public Works budget of $1.5 million is an increase of $39,450 or 6 percent over the current year. The department has been struggling to remove thousands of dead trees following the severe gypsy moth infestation and will receive an additional $10,000 for tree maintenance, bringing the total to tree budget to $35,000.
“There are small increases, but $17,000 of it is all personnel,” Russ said of the total DPW budget. “There’s a change in pension. We had an increase in our pension costs and the rest are all wages.”
Russ noted that an additional employee requested by the department had not been funded in the new budget because of the overall financial situation.
The DPW’s capital budget has also been reduced, to $565,000. Of that amount, $427,000 is for road work, and $138,000 will be used to purchase new equipment.
“That includes a payment, the remainder, that they made for a new truck and funding of half an excavator,” Russ said.
“It’s not an extravagant budget by any stretch,” Pinch said. “Everything in it is necessary and important, and we’ve cut everything possible and then some. Unfortunately we were unable to give the departments everything they needed, especially public works.”
The budget also calls for a $36,000 capital expense for the town’s information technology department. The funds will be used to upgrade the town’s computer server and a photocopier.
In addition, the town will allocate $40,000 for maintenance and repairs to Town Hall.
“We’re going to budget for this it this year but we have the money,” Russ said. “We’re not taking tax dollars for it.”
Nassaney said the town was facing a tough budget year but he was confident that the situation would improve.
“It’s going to be tight,” he said. “We’re going to have to work through the financial constraints that we’re in and every department has made sacrifices, knowing that we’re trying to do the best that we can for the people and the town. The financial stability is there. It just needs to be re-worked.
Pinch said she was grateful to Russ for her work on the budget, even though she will be leaving soon. The newly-hired Finance Director, Laura Kenyon, will start in June.
“We’d have been lost without Kelli in this budget process,” she said. “I’m grateful for her help putting this budget together on her nights and weekends. It’s been stressful for all of us, but it all came together.”
Residents will have an opportunity to ask questions and weigh in on the new budget at the public budget hearing on May 13 at 6 p.m. at the Town Hall.