Wednesday, February 10, 2016

Town Seeks Assistance On Finances

Town Seeks Assistance On Finances
Applies for grant for part-time fiscal expert
‘What caused a crisis here about three to four years ago was financial management.’ — Bob Markel, interim town administrator

Tara Vocino
Reporter

TEMPLETON –– With the town trying to get assistance through a new program sponsored by the governor’s office, hopes are high that a grant will be obtained to help with the town’s financial practices.

The Community Compact is a program introduced last year by Gov. Charlie Baker’s administration. Communities select three areas they want to focus on improving, which the state then agrees to help them with.

The three areas are taken from a list ranging from environmental policies addressing climate change to housing programs. In return, the state promises to try to give assistance.

For the purposes of the Community Compact, Tem­pleton is selecting the budget, financial policies and long-range planning/forecasting.

With an application pending for the Community Compact, Templeton hopes to obtain a grant through the state’s District Local Technical Assistance program in the category of best financial practices.

The grant would provide Town Hall with a staff person who is certified in accounting or municipal fin­ance, to provide assistance in ensuring that the town is using the best practices in financial management.

Interim Town Administrator Bob Markel said Templeton could use the financial management grant to have the budget specify all revenues and expenditures, and to provide a narrative describing priorities and financial challenges.

“It’s an opportunity for the town to get state funding in order to hire expertise in order to assist us in our ongoing efforts to improve our financial management practices,” Markel said.




He said that if he had to put a number equivalent on it, it would amount to about $20,000 in staffing.

The town’s pact priorities are all in financial management.

“What I was asked to do when I came here was to do a complete reorganization of, and improvements to, Templeton’s financial practices,” Markel said. “What caused a crisis here about three to four years ago was financial management. That includes the budget document, financial policies and long-range financial policies/forecasting.”

He filed the paperwork to join the Community Compact just before Jan. 29. The grant application itself is due Feb. 29. The funds are administered each year through a competitive process managed by the Metropolitan Area Planning Council. Funds are set aside by the Legislature to encourage cities and towns to either improve in the areas they’ve selected through the Community Compact or which encourage shared land use objectives or shared services.

In one aspect of the grant, sound financial policies would provide important structure and consistency around local fiscal policy decisions, and it would ensure that they are documented and followed. That would fall under the financial management category.

The best practice is achieved by evidence of documented fiscal policies, including reserve levels, capital financing and use of free cash.

Markel said the state Department of Revenue encourages communities to set aside 5 percent of the operating budget as reserve funds.

He said the stabilization and free cash accounts help the town’s bond rating and provide a cushion in case of an emergency. However, the debt load in Templeton is rather small.

“Templeton doesn’t have a problem with debt, but many towns do,” he said. “We should have a policy to address this.”

Markel said one of the policies that Templeton could adopt is to make a formal policy not to use free cash in the operating budget.

The grant suggests the town use long-term financial forecasting and long-term planning to detect fiscal challenges earlier, to develop strategies to address issues that emerge, and to provide the context for analyzing multiyear contracts and other financial trends.

However, Markel isn’t a fan of such long-range planning.

“I’m not enthusiastic,” he said. “It’s not that valuable to you other than having it. But it is interesting to see how things change.”

Markel said a grant was awarded in the fall to enable the Planning Department to use Metropolitan Area Planning Council staff to complete an update of the master plan.

“It was the first update of the master plan since the late ’60s,” Markel said.

The grant can be used toward any one of the following best practices categories: finance, education, energy/environment, financial management, information technology, regionalization/shared services, as well as transportation and citizens safety. However, Templeton is only applying in the area of best financial practices.

Markel said the town’s participation in the Community Compact and its pact priorities will definitely help it to be awarded the grant.

“We had a balanced budget last year,” Markel said. “We have a balanced budget this year, and we’re in balance for fiscal 2017. We achieved financial stability in the town. The next step is to ensure that the town is using best financial practices.”

2 comments:

  1. On the surface this is a great idea!

    But isn't financial assistance what the Division of Local Services and Department of Revenue are supposed to provide? So why now do we have to become members of the Community Compact, and then apply for a grant for financial expertise? If Templeton is awarded the grant and things get tight for the Commonwealth, can they pull the funding for the grant?

    Maybe this "financial expertise" can figure out a way for the town to borrow money for the elementary school project, when Templeton does NOT have a bond rating!

    Globally, central banks are resorting to negative interest rates to keep the economic ball of wax running..while the price of oil declines (can you say wood chip boiler) and oil tankers are stalled at sea because of the glut in the oil market. But I digress, that has nothing to do with Templeton.

    Templeton is in its own happy bubble! Unaffected by such details as a bond rating or lack thereof. What happens on a state or national , never mind global level has nothing to do with Templeton.

    What's in YOUR wallet? or so the saying goes. I fear the emperor has no clothes!

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  2. As the price of oil falls to historic lows we will all soon see the banks who bought into the bubble get a real wake up call. With our national debt so high we are not in any shape to help bail them out and i hope the outrage if we do make the politicians that for to help them get their walking papers.
    Hows that economy in Texas doing now with oil at 27.50 per barrel?

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