Midway through the year, East Hampton Town is not only “on budget” for 2014, but is expected to end the year with surpluses in all its major funds, Len Bernard, the town budget officer, reported this week.
“The town’s financial recovery over the last four or five years has been impressive,” Town Supervisor Larry Cantwell commented after Mr. Bernard’s financial report to the board on Tuesday. In 2010, the town had to seek state approval to borrow close to $30 million to cover a deficit that accrued under former Supervisor Bill McGintee, and efforts to straighten out financial accounts took years.
Mortgage tax, a major source of revenue, could reach $4.7 million this year, Mr. Bernard said, but even using a more conservative estimate of $4.1 million, and factoring in spending and other revenues, Mr. Bernard said he expects a surplus in the whole-town general fund of $1.6 million when 2014 ends. In the part-town general fund, which pays for only those services not used by residents of the incorporated villages, a $302,610 surplus is expected.
Mr. Cantwell, who took office in January, credited former Supervisor Bill Wilkinson, Mr. Bernard, who also served in the Wilkinson administration, Charlene Kagel, the chief auditor, and other members of the Finance Department with the turnaround.
As of June, three of four $160,000 commercial insurance payments had been made, health insurance was covered for the first half of the year, and 72 percent of debt payments were made, with interest, by one of the two main general operating funds, with 89 percent of the payments owed by the other main fund already made, totaling $7.3 million of the $9.8 million owed this year.
Revenue from almost every fee is expected to increase this year, he said.
Building permit fees are expected to raise more than was budgeted.
Fees for applications to the zoning and architectural review boards and fire alarm fees, are above projections, and so far, according to the budget officer’s report, there has been no need to tap into a $185,000 contingency line.
Mr. Bernard also ran down the funds that are expected to wind up with surpluses. “The highway fund is going to finish the year in good shape,” Mr. Bernard said. “We have a pretty innovative highway superintendent.” A $498,034 surplus at year end is expected. Last year, some of the surplus that remained in the town’s sanitation fund was used to cover other budget items, “so this is sort of a come-back year.”
Fees for dump permits and tipping fees are expected to meet or exceed the revenue projections in the budget, he said, and some of the Sanitation Department’s costs, such as those for health insurance for retirees and motor vehicle repairs, are running below estimates. If Mr. Bernard expressed caution, it was about the weather. Hurricane season or early snow could change the Sanitation Department’s bottom line. At present, the budget officer expects that fund to end the year with a $590,865 surplus.
The town’s scavenger waste fund will be affected by the waste treatment facility’s closing. A $74,000 surplus is expected, Mr. Bernard said, and there may be additional savings should the plant close before the end of the year, although some of that money might be used for the costs of decommissioning.
Even the airport fund is in good shape, Mr.Bernard said, calling it “very fluid.” It is expected to end the year with a bit extra in the bank — $31,290.
There were 299 full-time town employees on Jan. 1, the budget officer reported, and there are 309 at present. Eight of the 10 positions filled this year were included in the annual budget, and two — a director of public safety and the supervisor’s executive assistant — were added. However, neither Alex Walter, who is working for Mr. Cantwell at a $30,000 annual salary, nor Dave Betts, who was hired as the safety director to replace Patrick Gunn, is availing himself of town-sponsored health insurance.
Mr. Bernard also reported on the town’s overall indebtedness, which he said is expected to continue to decrease through 2017, to about $90.5 million. Of $17 million in bond sales to take place next month, he said, $4.8 million will raise money for new projects initiated by the present administration, while the rest is to restructure debt for previously authorized work.
Also on Tuesday, Ms. Kagel reported on an annual financial report for 2013. The balance in all of the town’s major budgetary funds had increased as of the end of the year, with the exception of the sanitation fund, where surplus was appropriated to cover expenses, and the scavenger waste fund, which began and ended last year with a deficit. That deficit decreased, however.
Ms. Kagel said the town’s “net position” — measured by the value of its assets over its liabilities — improved during 2013, “as cash balances increased and principal debt was decreased.”