Financial Update
The Town has officially closed its books on Fiscal 2015
(07/01/14 – 06/30/15). Fiscal 2015
was ended with a modest surplus. Fiscal
2016 is now underway with a budget that is balanced and the most modest increase
in taxes since 2007. Although twelve
vacant positions were not filled in the new budget, Town services are restored
back to the pre-crisis level.
The MA Department of Revenue has informed the Town that
there will be no certification of “free cash” until the Town presents audited
financial statements for Fiscal 2013, 2014 and 2015. Our new Town Accountant is working to reconstruct financial
records for these years so that the Town can present reliable information to our
auditors. Along the way, there
have been some surprises. Last
week, the Accountant found a dormant bank account containing $120,000. That the Town had lost track of this
account is embarrassing, but the good news is that Town finances are being
comprehensively reviewed and put into good order.
Once the Town can present audited financial information to
the Department of Revenue, they will certify free cash. I expect an abundance of certified free
cash based upon the $414,000 tax title auction and reimbursements from the MA
School Building Authority for 60% of the $500,000 borrowed for design for the
proposed new elementary school in Templeton Center.
The Selectmen, the Advisory Board and I are in agreement
that at least 2/3rds of free cash should be held as reserves or in the
Stabilization Fund as a hedge against any future emergencies. This is a prudent and conservative
approach which will also enable the Town to secure a better bond rating. The remaining 1/3 of free cash will be
proposed for capital purchases or other onetime expenses. The main problem underlying the fiscal
crisis in 2014, the use of free cash to float the operating budget has been
resolved. The elected and
appointed leadership of the Town are agreed that there will be no use of onetime
free cash to support the annual recurring expenses in the operating budget.
Once the Revenue Department has certified free cash along
with timely filing of Schedule A and the Tax Recap, the Town will be able to
get its bond rating restored. This
will be important should the taxpayers approve construction of a new elementary
school and a proposed addition to the police station.
...submitted by Bob Markel, Town Administrator
This comment has been removed by a blog administrator.
ReplyDeleteyes it is puffy and it began back in 2011 with an election that took a few weeks to complete.
ReplyDeletequestion is, what happened to the situation of completed balance sheets would do for certified free cash? Now we are back to audited books to certify free cash. So now the town can approve the borrowing of 50 million dollars to build a school for Templeton and whom ever else is allowed to attend from other area Towns.
ReplyDeleteThere is a lot of good news for Templeton in this financial update. There are unanswered questions as well.
ReplyDeleteIn order to support a new elementary school the voters should expect and demand a full accounting of the money spent on the project thus far - $1,050,000. This is the amount that has been approved by the voters thus far for the elementary school project.
A detailed explanation should be forthcoming on the process by which a voter's are asked to borrow money when the town does not have a bond rating. In my opinion, it is fool hardy to ask for a capital override if the town does not have a bond rating. Sorta like the situation where we built a playground in Templeton Center because the town was "promised" money from the state...kinda like that.
Setting aside a good chunk of free cash ( once it is certified...when?) is a great intention. I seem to recall something about a road to hell and good intentions. Time will tell.
Supporting education and the development of our young people is key in my book. Supporting schooling is something different and needs to be examined before we drive ourselves further into debt while taking away our children's future. Have a look and see if you agree. Schooling
ReplyDelete