BET Republicans note important areas in budget

FI-Letter-to-the-EditorTo the Editor

Editor’s Note: The following letter was submitted by the Republican caucus of the Board of Estimate and Taxation. 

Next year’s budget will be considered and voted on by the Representative Town Meeting on May 12.   This budget represents the collaboration of First Selectman Peter Tesei, the Budget Committee of the Board of Estimate and Taxation (BET), and the full BET.  Constructive input was received from many residents during two public hearings.

General fund operating expenditures are $383.5 million, an increase of 3.4%.  The Town will benefit from increased revenues from conveyance taxes and building permits.  The mill rate or property tax rate will be set by the BET later in May.  The increase is likely to be 2.75%, for the third year in a row.  Some of the important topics this year are education, employee benefits and pensions, the Fire Department, Nathaniel Witherell, and capital spending.

Education: Education is the largest item in our budget: $143.9 million.  If the related employee benefits were to be included, the sum would be about $180 million.  The Board of Education proposed this budget, and it was a well-thought out one, with an increase in spending of 2.1%.  However, school enrollment is projected to be down 1% next year.  At the BET, a motion was made to reduce the operating budget by 0.25%.  This change was not adopted but a number of BET members will be carefully watching changes in full-time and part-time positions over the next fiscal year.

Fixed Charges and Benefits: Fixed charges and benefits are a challenge every year.  Employee benefits total $89.9 million, an increase of 8.0%.  This is a budget-buster.   Health care is expensive.  The Town has tempered health care increases by shifting to high-deductible plans for employees, but cost pressures continue.  The annual pension fund expense is $22.7 million, an increase of 14.5%.  It has gone up a lot recently, caused by effects on the fund of the 2008 financial crisis and a prudent reduction in the assumed rate of return on the investments.  The growth of this expense is expected to flatten, with the contribution reaching $23.5 million five budgets from now.

Fire Department: Greenwich’s fire protection is provided by seven firehouses within the Town and a cooperative relationship with the firehouse in Banksville, NY.  The Department’s budget of $14.3 million represents an increase of 3.2%.  The BET considered a request to add nine additional nine firefighters, at an eventual annual incremental cost of $3 to $4 million.  The BET declined this request, satisfied that the proposed budget adequately supports the Town’s excellent fire protection services.  The Department is planning to improve the utilization of the Town’s committed volunteer firefighters.

Nathaniel Witherell: The Nathaniel Witherell Nursing and Rehabilitation Center has nearly completed Project Renew, its $27.2 million renovation and expansion of its facilities.  The Witherell originally requested a subsidy from the Town of $2.5 million in this budget to cover its loss from operations and debt repayment. Fortunately, the planned revenue from a one-time sale of $4 million in tax credits eliminated the need for the annual subsidy this year.

Capital Spending: Next year’s budget shows a strong commitment to maintaining Greenwich’s infrastructure.  Three major projects budgeted in earlier years are now underway: the Central Fire Station ($23.0 million), MISA ($46.0 million), and Project Renew.  Capital projects approved in this budget add up to $53.9 million.  These include replacement of the Town’s emergency radio system; a new centralized telecom system; an increase in the contingency funds for MISA; a portion of the soil remediation at Greenwich High; street paving, road and bridge maintenance; substantial annual school refurbishment; and many smaller projects.  Spending of $3.7 million is planned in this budget for soil remediation at Greenwich High.  Larger amounts will be needed in subsequent budgets, once the full remediation plan has been developed and is approved.

Funding: The budget increases the capital projects tax levy by $4.0 million, to $39.4 million.  This is the portion of residents’ current taxes which is designated for capital spending.  However, the Town will still need to borrow through short-term notes and bonds for those capital projects not covered by the capital tax levy.  New borrowings in this budget will add $17.7 million to the Town’s debt, net of repayments of principal.  This debt must be managed in a way that simultaneously serves the community, while continuing to maintain our Town’s strong financial position, protecting every taxpayer.  Total borrowing will remain within the $210 million debt ceiling established under the BET’s Debt Policy.

Our policy of modest and predictable tax increases is a benefit to all of our citizens.  Modest taxes broaden the appeal of our town and strengthen our real estate values.  The proposed budget provides strong support for our community’s priorities and will help Greenwich remain a wonderful town in which to live and raise a family.

 

Michael Mason (Chairman), Bill Drake, Marc Johnson, Art Norton, Leslie Tarkington, and Nancy Weissler
Greenwich

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