TEHKUMMAH—The initial estimate of the tax increase facing this year’s Tehkummah budget deliberations set the town clerk treasurer back in her chair when she first saw the number. For any municipal official or politician, the prospect of a near-63 percent increase in the municipal budget is enough to engender heart palpitations, if not a more serious reaction.
“I couldn’t believe it,” said Clerk Treasurer Karen Gerard, “I really couldn’t. I thought there had to be some mistake in the spreadsheet, so I went back to square one. Checked everything. All the formulas were correct.”
It turned out there was an error, but the tax increase was still over the top. The less heart stopping number was still unpalatable at best.
The bottom line was that the town was facing a $1.8 million operating budget. To cope with the sudden increase after several years of zero percent increases in the budget, along with at least two years of steep deficits, the town council and staff had some serious pencil sharpening to do.
In the end, items were deferred to next year’s budget (some $190,000 in capital expenditures) and $220,000 was drawn from the town’s rapidly depleting reserves to soften the blow. Luckily, revenues were higher than anticipated by about $220,000.
The bottom line was a five percent increase in the municipal mill rate. Still a hefty hike in light of the many years of zero percent increases, but a lot easier to take than the first number out of the block.
The town is also facing some serious issues that will not prove easy to defer, including a health and safety issue at the fire hall where an exhaust system needs to be upgraded.
The budget was clearly and evidently on the minds of council members when they voted to send out requests for proposals (RFP) to perform a full financial review of the municipality’s operations.
Council also voted to send out an RFP to provide auditing services to the municipality. The current auditors have been in place for several years.
Councillor Paul Bowerman said that he did not understand how the municipality’s finances, reserves and deficits and banking account balances were possible and where the money was, and how it was possible to transfer thousands of dollars into reserve accounts when there was plainly no money in the bank accounts to match that amount.
“I don’t understand and it makes me sick to my stomach,” he lamented.
Also coming down the pipe in the coming days was the hearing on the town’s dispute with a contractor over the bill for a local bridge—along with a potentially hefty bill should the town’s position fail at the dock.
Costs for the financial review were estimated at between $15,000 and $20,000.