APRIL 14, 2011
At a REGULAR SESSION of the Town Council of the Town of South Kingstown, County of Washington, in the State of Rhode Island, convened at the Town Hall, in and for said Town on the 14th day of April 2010 at 7:05 PM.
PRESENT: TOWN COUNCIL
Ella M. Whaley, President
Carol Hagan McEntee, Vice President
Mary S. Eddy
Kathleen A. Fogarty
James W. O’Neill
The following members of the School Committee are present: Maureen E. Cotter, Chairwoman, Kevin Jackson, Richard Angeli, Raissa Mosher, Elizabeth Morris, and Stephen Scott Mueller.
Also present: Stephen A. Alfred, Town Manager, Alan Lord, Finance Director, Dr. Kristen Stringfellow, Superintendent and John Ritchotte, Business Manager, School Department.
Notice having been duly given a Public Hearing, with School Committee participation, is held relative to the Town Council’s Preliminary Budget for FY2011-2012 as adopted on March 21, 2011. This Public Hearing addresses both the General Fund and the School Fund.
The budget process is guided by the Town Charter amendments as approved by the electorate on November 7, 2006. The Town Manager discusses the Town Charter provisions as they relate to the adoption of the budget that the Town Council and School Committee have participated in to date, and the provisions to follow the public hearings to be held this evening and tomorrow evening.
The Gross Tax Levy is $66,120,691. The difference between the $500 Motor Vehicle Exemption and $3,000 Motor Vehicle Exemption is the amount that would be generated from the property tax levy associated with motor vehicles. If a $500 exemption is used we would levy $4,213,207 and if a $3,000 exemption were used we would levy $3,182,964. If the $3,000 exemption is employed the tax levy doesn’t change, it means that the amount of money required from the real estate roll and personal property roll has to increase. Under the $500 exemption you would raise $61,907,484 from real estate and personal property roll, and it would require a $14.30 tax rate or $0.11 over the current year. Under the $3,000 exemption you would raise $62,937,727 from the real estate and personal property roll and it would require a $14.54 or $0.35 increase compared with the current year. Again, the increase in the levy doesn’t change the levy increase from the current year to next is $621,258 or 0.95%. The current year’s levy increase was 1.54% compared with the prior year.
The Town Council will need to make a decision on whether to employ the $500 or the $3,000 value credits in advance of June 15, 2011 when the roll is certified. At a $500 value there would be 28,804 cars that would be taxed and at a $3,000 value there would be 25,008 cars. The 3,800 vehicles that would go untaxed under the $3,000 value are vehicles that would have been within the $2,500 range between the $500 and $3,000 and that is what account for the $1,030,000 reduction in tax levy available.
The total municipal program includes the General Fund, the School Fund, the Water Fund, the Wastewater Fund, the Solid Waste Fund, the Peace Dale Office Building, the Neighborhood Guild and the Senior Service Program. The overall budget for the municipal program is recommended at $89,774,895 for FY 2011-2012 representing a 0.12% increase or $109,000 over the current year budget program.
The General Fund total operating program is recommended for the FY 2011-2012 at $19,812,157 or a 2.9% increase compared with the current year. The driving cost associated with the General Fund increase is directly associated with employment benefits and service costs. Principally changes in the retirement percentage share increases that occurred for the FY 2011-2012 will require an increase of about $258,000 over what the base year funding level was. Health care increases are about $49,000. Between those two areas we are seeing about a 6.5% increase over the current year cost. It is anticipated that there will be sizable increases for the FY 2012-2013 too. Debt Service increases in the General Fund are down, these are reductions that the Town Council has been directing over the past five years as we have reduced the amount of borrowing that the Town has been involved with both for the school and municipal purposes. We are looking at reductions in the amount of $293,000 or a 6.6% decrease. The capital budget is up about 1.47% or $18,000. The transfer to the School Fund is up 0.64% or $306,000; that provides for a total General Fund of $73,372,050.
The income statement associated with the General Fund has two areas that have seen substantive change. From the state revenue transfers we are anticipating an increase in aid over what we budgeted in the current year in the amount of $157,000, directly related motor vehicles reimbursement and we have budgeted about $160,000 for FY 2011-2012. Another line item that is in a state of decline is transfer from other funds; the decline is associated with three accounts that are economy related. One is a reduction of $125,000 in open space funding available through the real estate conveyance tax; a $13,000 reduction in impact fees used to pay down debt service; and $30,000 from the South Road School when the school stopped being used as a school facility.
The School Fund has been revised by the School Committee and it is presented tonight at $58,434,545 down $213,000 from the current year expenditure statement. Subsequent to the presentation of the Town Manager’s budget but before the Town Council adopted the preliminary budget, the Governor’s budget was delivered. The Governor’s budget provided a need for restructuring the revenue statement within the School Fund based on the revenues that would be coming from the state government. Essentially there was approximately $383,557 more coming through various state and federal programs than had been anticipated in the development of the budget. At that time we were balancing the budget with $383,000 less from state aid and increasing our dependence on funds held in the undesignated fund balance that was originally targeted at $775,000. Based on a recommendation from Town staff, the School Committee agreed to reduce the undesignated fund balance transfer to $392,066. All other accounts on the expenditure statement remain the same. It is important to note that the School Fund as revised shows a reduction of $463,000 from what had been originally submitted by the School Committee based upon review of some of the line items within the school budget with the School Administration.
The Town operates the Peace Dale Office Building which we purchased in 1983 as a special revenue fund. The increase in program cost is 10% and is directly related to the Town incorporating $8,000 in capital budget expenditures that are anticipated in FY 2011-2012. The revenue statement shows we will be producing more income than what expenditure requirements will be for Peace Dale Office Building. Revenues for that fund come from rental income, and the use of some undesignated funds.
The Neighborhood Guild is also operated as a special revenue fund. The program increase is approximately 2% for FY 2011-2012. Most of that increase is directly associated with program expenditures increasing but at the same time user revenues increasing. We are expecting more participating in programs on a fee basis. Trust funds that are managed by the Trustees of the South Kingstown School Fund provide for $424,000 of the total cost, essentially the objective with the Guild is to have the cost of heat, light and maintenance provided through the Trust Funds and for the various programs that are operated to be self-sufficient. Most are self-sufficient and we are able to expand this budget depending on what the demands are by the public for the various programs that we offer.
The Senior Services Program is also a special revenue program. Within the Senior Program we identify four specific programs: the Senior Transportation Program, Adult Day Services, Senior Services Center, and the Meals Program. The overall program is recommended at $726,208. It is important to note that this program has become regional in nature; Narragansett is contributing $100,000 to reimburse costs associated with residents of that community participating in the Adult Day Services Program or the meals or activities at the Senior. The Town of North Kingstown is contributing about $37,000 for FY 2011-2012 and that money is for reimbursement of costs associated with their residents participating in our programs. Again, revenues are equal to what the expected expenditures are.
The Water Enterprise Fund for FY 2011-2012 is recommended at $963,949, about $4,589 more than the current year. It is important to note with each of the Enterprise Funds full depreciation on assets is taken as a budgeted expense on an annual basis, that is why when you look at other expenses it shows at $336,000. Of the $336,000, $184,000 is budgeted for depreciation, debt service is budgeted in the amount of $86,000 and the capital budget is $57,000. The rest of the program is in the source of supply: all water that is purchased for the Middlebridge Water System and the South Shore Water System come through United Water. We are anticipating that a mid-year rate increase will come through United Water based on their anticipated filing with the Public Utilities Commission (PUC). A rate increase in the minimum base unit charge from $165 to $175, an additional unit charge increase from $65 to $75 per year and an excess charge increase from $2.71 to $2.91 per 100 cu. ft. is required for FY 2011-2012.
The Wastewater Enterprise Fund for FY 2011-2012 is recommended at $3,201,247. Again, full depreciation on assets is taken as a budgeted expense on an annual basis. We are anticipating a $45,000 reduction in the energy costs associated with the operation of the treatment plant in the FY 2011-2012 year. We also have a grant application pending in an attempt to bring natural gas up Westmoreland Street in Narragansett to get away from the use of diesel fuel. It is recommended that the minimum yearly user fee be increased from $220 to $225 for a single family dwelling; and from $2.75 to $2.85 for the excess rate per 100 cu. ft. for consumption in excess of the 10,000 cu. ft. minimum allowance.
The Solid Waste Enterprise Fund for FY 2011-2012 is recommended at $719,603. No rate increases are proposed. The Solid Waste Enterprise Fund not only operates the Transfer Station it also provides a means of paying costs associated with closure of the Rose Hill and Plains Road Superfund sites.
The Town Manager discusses the Reserve Fund Transfers associated with each of the eight funds.
Adjourn at 7:41 PM.
Dale S. Holberton, CMC