2006 Budget Challenges Additional Increases in Pension Contributions = +$451,200 Additional Assessment from RVSA = +$315,000 Increases in Fuel and Utility Costs = +$90,000 Increase in Group Health Insurance = +$299,000 Union Contract Increases = +$536,700 Public Library Increase = +$205,468 Debt Service Increase = +$60,500 Animal Control Services = +$15,000 No Increase in State Aid Decrease in Municipal Court Revenues -$170,000

The Municipal Budget Process Information Gathering Department Requests Financial Projections Review & Discussion Public Presentation & Initial Approval Auditor Review & State DCA Approval Public Hearing & Adoption

Information Gathering Is a continual process from the completion of one budget to the start of the next Salary Projections - Negotiated Union Contracts - Existing Staffing Levels Employee Benefit Costs Debt Requirements Utility Costs and Other Projections

Department Requests Submitted in mid November Request Operating Expense Needs consistent with existing trends Detailed justification for trend variances Line Item Requests itemized according to classification of expenditure Review of Staffing Levels

Financial Projections December is wrap-up month Revenue Projections to year-end - Tax Collections, % from prior years - State Aid received in full - Miscellaneous (Parking, Construction, Court etc…) Expense Projections - Determine Cancellations & Reserves - Unspent Prior Budget Closed to Reserve Departmental Budget Meetings, review requests

Financial Projections (continued) Project Year End Fund Balance State Aid does NOT increase Miscellaneous Revenue based on current year’s projected totals Fund Balance used as Revenue to the extent prudent - Must maintain adequate reserve balance Tax Revenue calculation

Budget Review and Discussion January Finance Policy Committee meets with Auditors for 2005 budget wrap-up and 2006 projection analysis & priorities February Initial draft budget submitted to Finance Policy Committee February & March 2006 include policy discussion sessions: - Staffing Levels - Spending Priorities, or Cuts - Budget Impact on Tax Rate - Services or Programs to Add, Continue or Discontinue

Public Presentation and Initial Approval First Reading, Introduced to the Public Public Hearing Date Announced Budget Summary Advertised Auditor Review & DCA Approval Statutory Compliance and Clerical Accuracy Budget Discretion is solely by the Town Council – Auditor and DCA opinion is limited to legal compliance Approval on Statutory Compliance required before Public Hearing and Adoption

Public Hearing and Adoption Opportunity for the Public to Comment Final Vote to Town Council occurs after listening to public comments Budget can be approved, amended without extending public hearing, amended with additional public hearings, tabled pending discussion on possible amendments, or rejected

2005 Total Tax Collections $107,806,714.26

2006 Appropriations Breakdown Statutory/Required Appropriations - Pensions, Social Security, Unemployment, Library, RVSA, Group Insurance, Street Lighting, Fire Hydrants Non-discretionary Appropriations - Salaries & Benefits - Debt Service Payments - Miscellaneous & Reserve for Uncollected Taxes Discretionary Appropriations - Departmental Expense Budgets

2006 Appropriation Breakdown

2006 Appropriations Highlights Departmental Operating Budgets down 2%  - $89,260 Salaries Budget up 2.9%  + $461,728 Debt Service down 2.6%  - $39,500 Statutory/Required Expenditures up 14.6%  + $1,263,968 Reserve for Uncollected Taxes down 3.8%  - $70,000

2006 Appropriations Analysis Departmental Operating Budgets Administration- $20,000 (8.5%) Fire Dept.- $14,812 (8.4%) Public Works- $51,000 (4.4%) Building Dept. - $49,000 (46.4%) TV36- $15,180 (45.5%) Utilities+ $90,000 (16.8%)

2006 Appropriations Analysis (continued) Salary Budget Administration - $39,661 (9.9%) Police Dept.+ $217,600 (3.9%) Fire Dept.+ $224,000 (7.6%) Engineering+ $5,299 (0.7%) Public Works- $4,903 (0.2%) Building Dept. + $26,482 (6.7%) Crossing Guards+ $20,000 (5.3%) Health Department+ 23,020 (4.5%) TV36- $9,250 (12.4%) Parking Dept.- $66,254 (22.7%)

2006 Appropriations Analysis (continued) Debt Service Bond Principal & Interest + $60,500 (4.7%) Deferred Charges - $100,000 (45.5%)

2006 Appropriations Analysis (continued) Statutory/Required Expenditures Library + $205,468 (11%) PERS+ $58,200 (138.6%) PFRS+ $393,000 (105.4%) RVSA+ $315,000 (18.8%) Group Insurance+ $299,000 (9.2%) “Budget Busters”

Did You Know… The Municipal Budget includes appropriations for: Street Lighting$270,000 Public Fire Hydrants$480,000 Senior Transportation Services$102,500 School Crossing Guards$400,000 Reserve for Uncollected Taxes$1,790,000

2006 Revenue Breakdown Revenue Sources - Property Taxes - State Aid - Miscellaneous Revenue - Grants (offset by appropriations) - Fund Balance

2006 Revenue Breakdown

State Aid Analysis YearState AidInc./Dec.% of Budget 2001$4,232, % 2002$4,229,618 -$3, % 2003$4,250,784+$21, % 2004$4,484,903+$234, % 2005$4,484,903+$013.86% 2006$4,484,903+$013.24%

State Aid Analysis (continued)

Did You Know… Anticipated Revenue Sources include: Municipal Court Fines and Fees$530,690 Parking Permits, Meters & Pay Stations$1,520,000 Building Department Fees$890,000 Interest on Income & Investments$490,000 State Aid$4,484,903 Delinquent Taxes$867,000 Fund Balance$4,000,000

Tax Calculation Formula Total Appropriations$33,896,440 minus Anticipated Revenues$14,877,300 equals Local Purpose Tax$19,019,139 divided by Total Assessed Value$1,851,680,092 equals Local Tax Rate1.027 per $100 assessed value

Tax Cost Comparison 2005 Average Assessed Home = $178, Average Assessed Home = $179, * County Tax$2,206$2,289 School Tax$6,522$6,818 Local Tax$1,702$1,847 Total Tax$10,430$10,954 * 2006 Tax Costs Estimated

Continued Examination … Regional Health Department Management of RVSA Assessments Existing Staffing Levels Group Health Insurance Effective Contract Negotiations Shared Services Review of Revenue Sources Efficiency Studies

Increases for 2007 Budget Additional 20% increase in Pension Contributions (PFRS 80%, PERS 60%) Additional Assessment from RVSA Increases in Fuel and Energy Costs Group Health & Casualty Insurance Union Contracts Continuation of Services (Leaf Collection, Snow Removal, Street Lighting, Recycling, Police & Fire Services, Conservation Center, Infrastructure Improvements, etc…)

2006 Budget Challenges Met Health Insurance Costs Reduced by Effective Contract Negotiations Public Library Board partners with Council to long term cost savings to taxpayers Debt Service decreased by reducing Deferred Charges Decrease in Court Revenues due to State Surcharges Staffing Levels decreased where possible. Five F/T position reduced to 2 P/T positions Reduction of Reserve for Uncollected Taxes Comprehensive examination of total budget producing real savings in all departments