A $65.6 million East Hampton Town budget for 2012, up from almost $64 million last year, was the subject of a hearing before the town board last Thursday night.
The proposed budget sets property tax rates for town residents at $26.58 per $100 of assessed value, and $11.10 per hundred for village residents. Because of expected revenue from sources other than taxes, it projects a $2.32 savings for owners of a house in the town with a $500,000 market value, and a savings of $8.12 for those with houses valued at $1.8 million. Savings would be higher for village residents, at $46 for a $500,000 value or $161 for a value of $1.8 million.
Several modifications of the original budget were made, Len Bernard, the town budget officer, said at the hearing. Projected revenues from town recreational programs were dropped by $10,000, for instance, and $10,000 added to the amount expected from permit fees collected by the town clerk, based on this year’s figures. Several oversights, such as the omission of $58,000 for planning board members’ salaries, were corrected. The bottom line remained essentially the same, Mr. Bernard said.
None of the changes were based on comments submitted to the town by the New York State Comptroller, who must review the town budget according to terms allowing East Hampton to borrow some $27 million to pay back a deficit that had been allowed to accumulate under the previous administration.
The town is required to explain to the comptroller why budget suggestions have not been followed. At the hearing, Mr. Bernard outlined the comptroller’s concerns and the town’s response.
In response to the comptroller’s concern that the budget assumed revenues from property sales for which contracts have not yet been signed, Mr. Bernard said that several sales are being negotiated. The board, he said, could adjust the figures pertaining to the sale of East Hampton’s interest in the Poxabogue Golf Center to Southampton Town, its joint owner, but suggested that if members feel confident that the contract approval is imminent it should be left as is.
Several speakers urged the board to give as much money as possible to Project MOST, an after-school program for youngsters based at Springs School. “I believe Project MOST is a wise investment in the long run,” said Michael Hartner, the Springs School superintendent. “The children that come to Project MOST are the children of the workers of this town,” said Dan Hartnett, a social worker in the East Hampton school district. “For me, the question is the priorities of our town. What better bang for the buck could you get than funding Project MOST?”
In a letter to the board read at the hearing by Averill Geus, Stephen Grossman, who lost a bid for town justice on Election Day, also supported Project MOST, questioning an expenditure of $80,000 for security at the town court “while underfunding or not funding preschool care.” He also questioned whether the salaries of the justices, who work part time, were justified.
Sylvia Overby, who will take office in January after winning a seat on the town board last week, questioned the deletion from the budget of money to run the scavenger waste plant, which the board anticipates privatizing, as reported elsewhere in this issue. We haven’t determined what we’re doing,” Councilwoman Theresa Quigley told her. “Should it be deleted from the budget if you haven’t determined,” Ms. Overby asked. The town must correct environmental violations before turning the plant over to a new operator.
Ms. Overby also suggested that a 20- percent increase in the architectural review board budget be reallocated to the Planning Department, which lost two staff members and will experience a 15- percent cut under the new budget. A planner who resigned would be willing to continue as a part-time worker, she said, and would be an asset to the town.
Supervisor Bill Wilkinson said that cutting jobs enabled him to trim the budget. “That’s an important dynamic to continue,” he said. “We try to do more with less,” he told David Buda, a speaker who decried a budgetary and staff reduction in the Ordinance Enforcement Department.
In written comments distributed this week, Zachary Cohen, a Democrat whose bid to unseat the Republican Mr. Wilkinson as supervisor depends upon still-uncounted absentee votes, outlined his own concerns.
Several amounts included in the budget as one-time revenue will create problems in the future — specifically, a need for a tax increase — he said, and reflect “poor finance.”
He cited an appropriation of $705,000 from a highway fund surplus, to help pay the annual operating expenses of the Highway Department next year. “A better use for the surplus would be to avoid more borrowing in the future” for road repair and equipment replacement that has been underfunded, he said, in recent years. Similarly, Mr. Cohen said, “The use of $1.1 million of appropriated surplus in the sanitation [solid waste] fund solely to provide a tax reduction is also poor finance.”
He also suggested that lacking a firm contract, money from the sale of assets such as Poxabogue should not be relied on for next year’s budget.
“A good general rule of municipal finance is that one-time revenue events, such as the sale of assets or appropriated surplus, should only be used to fund one-time expenses, such as equipment purchases or to lower borrowing needs. Whenever one-time revenue is used as general operating revenue, it builds a tax increase into the next year’s budget equal to the amount of revenue recorded,” Mr. Cohen wrote.
Like his running mate Ms. Overby, he questioned the budgetary decisions regarding the scavenger waste plant.
Mr. Cohen also provided an analysis of “chargebacks” from one town fund to another. The proposed budget, prepared by Mr. Wilkinson and Mr. Bernard, includes sums to be paid into the general operating budget by other, stand-alone, town funds: $253,912 from the highway fund, $277,640 from the solid waste fund, and $185,014 from the airport fund.
The practice, being employed for the first time, provides that payment for particular services being performed for departments with their own funding sources, such as legal work, is paid from that source, rather than from the general fund. The state comptroller approves of the practice, according to notes accompanying the budget, as long as there is documentation.
Mr. Cohen commented that the three funds from which money is to be transferred into the operating fund are those with surpluses, a portion of which will be appropriated next year.
“There is an obvious implication that these chargebacks are a gimmick to artificially reduce taxes in the whole town fund by moving surplus from highway, solid waste, and airport into the whole town fund,” Mr. Cohen wrote. He also questioned the estimated chargeback amounts.
According to state law, the town board must adopt a budget for next year by Sunday. A vote is expected to take place at a board meeting tonight, although it was not on an agenda for the meeting reviewed by the board on Tuesday.