Edelson Weighs in on Upcoming Budget Referendum

First Selectman Ed Edelson issued the following “First Selectman’s Message” leading up to the budget referendum vote this week:

The operating budget prepared by the Town of Southbury for Fiscal Year 2014 (July 1, 2013 through June 30, 2014) is 0.9% below the budget approved for the prior fiscal year.  This is the result of hard work on behalf of the staff, the Board of Finance and the Board of Selectmen to identify efficiencies, meet our employee obligations and strengthen specific areas noted below.  I encourage everyone to read this message, review the detailed proposed budget on the town website and vote on May 8th.  The referendum vote will take place at the Central Fire House (461 Main Street South) from 6:00 AM to 8:00 PM.

Below are some highlights of the most significant changes:

Efficiency Improvements 

• Medical Insurance Pooling:  As a result of progressive actions in June 2012, we have been part of a regional medical insurance pool with Region 15 for the past year.  Using the enhanced purchasing power of this pool of over 600 employees, the pool solicited competitive bids from five insurance carriers for fully insured and self-insured coverage.  Based on the decisions made by the respective Boards, Southbury will save about $182,000 for the same employee medical coverage.  
• Energy Savings: As a result of an aggressive push to reduce energy costs by investing in electrical controls (set back thermostats, variable speed fans) and switching to natural gas, we will save $78,000.  Many think this is conservative but until we have more experience with natural gas, we are staying with this estimate.
• Trash and Recyclables:  After a thorough search of alternative waste handling companies, we chose to move our trash and recyclable handling to a new company, Covanta.  This lowered our per ton fee to handle municipal waste.  They also provided us with a $7,500 outreach grant that we will use next year to encourage more recycling.  Our target is another $20,000 in reduced fees from expanded recycling.  Overall, our trash and recyclables will save $50,000 when compared to last year’s budget.
• General Government:  Due to a mix of many improvements, the cost of general government (tax collection, fiscal office, town clerk, legal, liability insurance) is budgeted at $129,000 lower than last year.
• Reserve Funds and Debt:  A careful review of the reserve funds set aside for vehicle replacement, infrastructure replacement, planning studies and revaluations identified savings relative to last year.  Last year’s refinancing of the debt also provided reduction.  Overall, this area is reduced by $115,000.

Areas Strengthened

• Increase in police force:  After careful deliberation and in light of recent horrific events involving gun violence, the Boards agreed to increase the number of police officers by two.  This is offset by reduced overtime for police department and other efficiencies.  The net increase for Police Department is $36,000.
• Pension Payments: In addition to the recommended minimum contribution to the pension fund, the Board of Finance recommended that an additional $155,000 be contributed.  Although our pension fund used to be funded at a level over 90%, the impact on our investment portfolio from the Great Recession dropped that to 70%.  Our goal is to get this back over 90% over 5 years.  This is a prudent and responsible action.
• Parks and Recreation:  The budget has been increased to allow expected growth in our very successful programs like summer camp, basketball and swimming.  All of this increase, however, has been offset by expected increases in revenue – so there is no net effect on property taxes.
• Capital: An increase of $36,000 for capital projects is included.  We will also be making more effective utilization of capital funds provided by the State of Connecticut to address issues related to our parks (outdated and dangerous playgrounds), fire department, police and public works.
• Labor Cost:  Our dedicated employees are budgeted to receive approximately a 2% increase in compensation, which is in line with recent inflation.  Some of this is by negotiated contract (Public Works), some will be negotiated (Police) and others will be done by the merit based system used for non-union employees.  There is, as you might expect, variation in what each employee will receive.

Overall, the budget decreases by $174,000 to $18,980,055 from $19,154,055.

The Mill Rate and Your Taxes

As I have pointed out over the last year on several occasions, the recent revaluation would have an effect on all property owners.  The revaluation results in the Grand List of total property to be taxed.  The new Grand List total is about $2,090,065,930, which is 20% below the prior year grand list. The mill rate is determined by dividing the revenue required to fund the town and Region 15 operations (after offsets from other revenue sources like those we receive from the State of Connecticut) by the Grand List.  As the Grand List goes down in value, the mill rate goes up. However, not every property went down by this amount – it is an average.  Therefore if your property value went down by more than the 20%, the new mill rate (based on the average) will cause your taxes to be lower.  If your property value went down by less than 20%, you will see an increase.  I would expect that all car taxes will go up as it is based on the same mill rate.

In conclusion I want to thank all of the staff, Board of Finance and Board of Selectmen for their hard work over the past five months as we prepared, debated and approved the Town of Southbury budget that will be on the ballot on Wednesday, May 8th.  I believe it is a carefully considered, responsible budget that shows our commitment to continuing to make Southbury a great place to raise a family, own a business and retire. Now it is up to you to do your own assessment of the budget and make sure you take time out to do your civic duty – Vote on May 8th.

Ed Edelson
First Selectman