The Seabrook Budget Message for FY 2017

Below is my budget message to the Seabrook Board of Selectmen for FY 2017, which begins on January 1, with Town Meeting in March of 2017.

Budget Message FY2017

I am pleased to present the annual budget to the Board of Selectmen for FY 2017.
As the Board considers this Budget it is important to note that health care pricing for the next cycle is not yet available, and will need to be incorporated into our budgetary numbers when the Health Trust provides us with that figure. Another note is that the numbers for our obligation to the New Hampshire Retirement system have spiked dramatically. Our recent discussion with our independent auditors highlighted the “unfunded liability” of the N.H. retirement system, with a $10 million charge to our balance sheet that recognized our portion of that liability. It is likely that the local assessments will continue to rise in order to correct the problem, which is not good news for our taxpayers.
The budget submitted continues to reflect the policy direction set by the Board of Selectmen. The rate of increase for the overall budget is 1.36% over last years budget. It should be noted that even that small increase, when further analyzed, shows that discretionary increases not mandated contractually account for about one half of one percent of the total increase. Contractual and mandated increases, such as the one highlighted above for retirement benefits, account for just under 1% of the total. The number submitted to the Board is exceedingly lean, and during the course of your review I know that you will hear, from our Department heads, legitimate requests for increases to address needs that are important as we provide vital services to our community. In many cases I not only understand, but agree that such increases would be helpful in providing first rate services. My recommendations are not dismissive of these ideas, but a recognition that keeping the overall tax burden stable is vital, and that we face a major unknown as to the ultimate results of the tax negotiation with our largest taxpayer, NextEra Energy.
The NextEra negotiation, still ongoing, is obviously critical. The 2015 tax payment constituted approximately 72% of the Town side expenditure, and while the ultimate outcome of the negotiation is yet to be determined we must brace ourselves for the potential of a smaller payment. Until such time as we know the outcome of that negotiation it will be difficult for me as Town Manager to recommend to the Board the undertaking of new budgetary spending, even where some justification may be evident. 

Our last independent audit showed our unexpended fund balance as over $9 million, a growth from last years number of about $8 million. We funded a major capital project out of that fund last year, and I realize that many feel that the number may be too high. But the direction given has been to create a fund balance sufficient to buffer the community against the potential downsides of a new agreement with NextEra, and this fund balance is designed to give our community that budgetary flexibility. It would be fair to say that we will be in a better position to fully understand our ability to take on additional capital spending, or address additional Departmental needs, in the FY 2018 budget year.
In this budget there has been a reconfiguration, in a minor way, of how some personnel are deployed within DPW. While there is no request made by me for additional full time personnel I have recommended some additional part time personnel within those budgets. Additionally I have not listed the requested swing set for Harborside Park within the submitted budget, but would recommend a $6,000 appropriation for that equipment, within the Parks Department Budget, should the Board wish to include it.
I would like to take the time to highlight the findings of the independent audit, which gave Seabrook strong marks for implementing management reforms, and for fiscal management. The Board of Selectmen have set strong priorities and policies for management to follow, and those policies are paying dividends from a management perspective, which translates into a much stronger fiscal position for our Town.
We have prepared the draft CIP, which will be submitted to you this week. A preliminary draft warrant, and prospective articles, have been prepared for you to examine as you review the municipal budget. I will also give you a review of requested, and dollar amounts, approved by voters for articles in this past three years. We will be able to provide capital spending by Department, which may be helpful in considering this years requests.
We have managed to submit a budget a bit earlier than we did last year, and we look forward to the Board’s review, comments and prospective changes. I would like to thank my staff for all of the hard work that has gone into preparation of the municipal budget. Our Finance Manager Carrie Fowler has done an outstanding job, not only in preparation of this budget, but in producing the audit results cited earlier. The Deputy Town Manager Kelly O’Connor has worked diligently on our budget, and has prepared the warrant articles for your consideration. My thanks to Procurement Manager Shaylia Marquis, who has worked to prepare our CIP. All of our Department Heads have worked very hard to make this budget process a smooth one, even when they hoped for different results. Seabrook is blessed with top quality professionals serving our citizens.

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