Pink slip leads to red ink

(This story was last edited December 3, 2010)

Taghkanic taxes going up 11% after town left state fund

TAGHKANIC — The Town Board adopted a 2011 town budget November 16, with a tax increase of over 11%. Despite attempts to cut the budget and to offset the increase with reserve funds, the board had to increase expenditures for the town Highway Department. But taxpayers are also taking a hit from an unexpected source.

Expenditures next year include an $18,256 for the town’s contribution to the state unemployment system due to the layoff of a worker in the Highway Department.

 

The town’s liability, which was not discovered until the individual laid off filed for unemployment and the board started receiving bills from the state Labor Department, arose because the town opted out of paying into the state unemployment fund. As a result, when a claim is filed it is on its own for its share of the payments. A search to determine the history of the opt-out decision, which may have been made in 1996 or before, has so far proved unsuccessful.

The roughly $30,000 that could be paid out by the town over two years in unemployment claims effectively erases any gains by the Town Board’s last minute belt-tightening measures. Cuts included slashing all salary increases, cutting library contributions in half, cuts to consultants, and the elimination of funds for town beautification and celebration.

The total town expenditures for the general fund and Highway Department come to $1.1 million. The amount to be raised by taxes next year is $670, 162, up from just over $600,000 in the current fiscal year.

The tax rate in the new budget comes to $2.07  per $1,000 of assessed value, up from $1.86 in the current budget. It would have been higher had the town not taken $30,000 from the general fund reserve account and $20,000 from the highway reserve fund. But those allocations caused some observers to worry that the town is now vulnerable to emergencies, because the transfers reduces the two town rainy day funds to $100,00 in the general fund reserve and $16,000 in highway fund.

During recent budget workshops one of the town assessor’s budget line came under fire. “We have three assessors, yet we are farming out all these chores at a not inconsiderable expense,” said board member Larry Kadish, referring to $41,000 worth of contracts with GAR Associates last year, which he said amounts to $55 per resident.

“We’re way out of line. That’s close to twice what other small towns spend,” said Dr. Kadish, who complained that he has yet to get a satisfactory explanation from Town Assessor Art Griffin as to why the service is necessary.

The Town Board decided to retain the contractual part of Mr. Griffin’s budget in the general fund this year to maintain more control of expenditures in that budget line. Board members reduced the assessors’ budget to $29,000 for the coming year.

The new budget fails to set aside money for a new highway garage or salt shed, the need for which was frequently discussed during the preceding year. It also cut funds for repairs on the town’s ragtag fleet of trucks or for the purchase of the two new trucks that town Highway Superintendent Tom Youhas says are needed to get through the coming winter.

“An information deficit has handicapped us in planning. Why is that not forthcoming?” asked Dr. Kadish, who complained that fellow board member Joyce Thompson had to file a request under the state Freedom of Information Law to get town financial records. A report on a state audit conducted in October has not yet been received.

A new process supported by both parties that will begin this year may help control future expenses. The Town Board plans to adopt an bid request process before hiring contractors, including engineering, accounting, assessor, legal, and insurance professionals. “You don’t by law need competitive bidding but most towns do have RFP’s. That allows us to put more pressure on those who have not been forthcoming,” said Dr. Kadish. An RFP, or request for proposals, is a formal bid solicitation process.

In the 2011 budget, the town cut back funds designated for attorneys and accountants, among other service providers.

Town resident Martha Meier was critical of the board. She quoted from a campaign letter to voters from Richard Skoda and Carolyn Sammons that  promised on-time and under-budget building projects and highway maintenance, transparency, and a rainy day fund.

“I hope you have a plan,” she said. “You pay as you go and finance by going into debt. I have no doubt your intentions are good. Not raising taxes is dear to your heart. But our rainy day fund is now depleted,” said Ms. Meier.

“The cupboard is bare because they have made no provisions for the future,” Dr. Kadish said.

Comments are closed.