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State of the Town (2018 annual budget meeting)
Welcome and good evening. As I stand before you today, I am pleased to report that the state of the town is excellent.
Old Saybrook has its fiscal house in order: our expenditures are controlled, our revenues are steady and strong, most major capital projects are complete, our public debt is declining, our Rainy Day fund balance is the highest it has been in the last 15 years, our yearly capital accounts are being funded, and our local business community, despite Connecticut’s weak economy, is vibrant. Old Saybrook has so much of which to be proud. A strong volunteer community commitment, well kept infrastructure and a government that has identified professional fiscal management as a priority.
Over the past six years, my administration has set out to create a General Government budget through a methodical, thoughtful and inclusive budget process to ensure appropriate funding to meet the service needs of the Town while creatively redesigning operational processes, prudently reviewing and renegotiating all town contracts, and addressing long term capital needs and liabilities. Our general government operations budget for 2018-19, the seventh budget under my administration, shows an increase of less than one half of 1%. We have re-financed the town’s long term debt twice in the last two years saving nearly $1.2m in future interest payments. Our general obligation debt will see a precipitous decline over the next five years and we should not need to access the capital markets for
any government construction. The Town budget, when combined with the Board of Education budget, demonstrates Old Saybrook as a whole continues to be fiscally prudent. Based on the expenses and revenues as presented, this budget, if passed next Tuesday, will result in a lower mill rate and lower taxes for Old Saybrook residents.
Yes, lower taxes.
A majority of the overall Town budget goes to our schools. Over the course of the 16 years that I have been involved in Town Government, we have never considered Old Saybrook to be a divided government: one consisting of General Government and one consisting of the Board of Education. That is why we present our budgets to the public together. Our Board of Education has worked hard under Superintendent Jan Perruccio and Chairman Kelley Kennedy to present a responsible budget and I support their efforts.
This budget is a planning document. Let me tell you where we are investing and what we have planned.
- Capital Accounts-We have created dedicated sinking funds for ongoing capital needs. This budget and the six before it places funds aside for public works equipment replacement, Fire Department apparatus replacement, for future state mandated revaluations, roof repairs on our buildings and other projects. As a result, we are and will be able to meet the equipment and infrastructure needs of our town on an ongoing basis. Planning for the future smooths out budget fluctuations while meeting both short and long-term operating obligations in a cost effective manner.
- Future and Unexpected Capital Needs- We continue to fund our capital non-recurring account for unplanned capital needs that as they arise during the course of the year. In the past, these funds have paid for seawall repairs after Hurricane Sandy, energy efficiency initiatives, upgrades at the YFS building, heat pumps at the library, our streetlight replacement project and renovations to P & R facilities. This fund has been a valuable tool since it was introduced fully in 2011, my last year as chairman of the B of F.
- Water Pollution Control Authority-Shortly after being elected in 2011, the first septic system upgrades commenced as per the COURT JUDGMENT against the Town. Now, 7 years later, due to the good efforts of current and past employees, we expect nearly two thirds of the program sites will be addressed by the end of 2018. Sewer avoidance is complex and unique. However, our team will continue to act in the best interests of the town in what is a difficult environment.
- Employee health benefits-We have promoted market based health insurance for all our employees. This has helped the town reduce costs of premium and driven our employees to make better health care choices. We will continue down this path as we engage our employees in collective bargaining negotiations in an attempt to stave off the continually escalating costs of health insurance.
- Pension- Over the years, I have spoken of my continuing effort with the Town’s Pension and Benefits Board to implement a 401a plan (401k) for all new town employees. Keeping a traditional defined benefit pension plan is impractical and we need look no further than the State of CT to see what havoc these long term liabilities cause. As of July 1, 2017, we have implemented this plan for new employees. At the same time, our traditional pension plan is funded at nearly 90%. Old Saybrook continues to plan for its future while we are financially strong; Old Saybrook is not waiting to change our ways until a crisis is upon us as the State, and many other municipalities, have done. With our new 401a plan, the town will have a yearly obligation that is not tied to a good
or bad stock market, and one that also does not look to the taxpayer as the payer of last resort. This new plan offers financial protections for our Town for the next generation and thereafter.
- Human Resources- We are making better human resource and personnel decisions through process; we are not growing government but instead, we are making better decisions when we replace employees. From an operational standpoint, many Town departments have been reorganized including the offices of the Selectman, Accounting, Building, Town Hall and Fire Marshal offices, and in doing so we have reallocated or eliminated salary and fringe benefit expense. The hiring process has been formalized by creating search teams and a rigorous candidate review process. By bringing on strong team members, the operational efficiencies have been enhanced through new ideas and the automation of previously manual processes. The Town’s long term information technology strategy
enhances service to our residents, while keeping costs down by bringing more Town Hall services on-line and available to the community from their homes 24/7.
- Grants: The Town has appropriately leveraged state and federal grants for the benefit of town infrastructure and town taxpayers. Most recently, we have seen this in the $1.3 million dollar grant to rebuild North Main Street which was recently completed, a $200,000 Brownfield Area Revitalization Grant to further explore what Mariner’s Way (aka Route 1 East) will look like as we continue to encourage economic development in this part of town and $7m dollars to dredge North Cove, a harbor of refuge and a seasonal economic engine for our community. The grants we pursue are purposeful targeted carefully planned funds that will benefit our Town for years to come and continue to make Old Saybrook a place where people want to live, work and play. We have made great progress over
the last 6.5 years in moving the town forward with economic development, quality of life improvements, excellent public safety, good schools and tax rates that rival any town in the State, all while keeping Old Saybrook’s small town charm.
As we look to the future, Old Saybrook finds itself in an enviable position due to the superior financial condition of our town. We need to seize upon this opportunity. While other towns are contracting finances due to overreliance on state aid, or simply fear for the future of Connecticut, now is the time for our town to invest in quality of life improvements that will prove to make a difference. Connecticut’s economy will rebound eventually, I believe, but the time is now for us. Whether it is better sidewalks all over town, new recreational options for the young, middle-aged and elderly or increased environmental sustainability, we have an opportunity to further differentiate ourselves as a special place. We must be prudent with our finances, but not be afraid to invest in a better future.
This budget prepares OS for the rough waters ahead as our State, sadly, continues its slide into fiscal chaos. We have anticipated less revenue from the state this coming fiscal year, nearly a million dollars less than just 3 fiscal years ago. Our schools have also have braced for reductions in state funds and have taken prudent steps in anticipation of what lies ahead. Despite this, Old Saybrook places before the voters a budget next week that is historic in that it proposes to reduce taxes, something that no First Selectman has been able to say in over 25 years. Please vote on May 15. Thank you.
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