Town Administrator Thatcher Kezer said during his State of the Town presentation to the Select Board that the process for developing the next town budget has started.
He provided estimated numbers for town revenue with the amount for property taxes is $82,181,362.
Total state aid being received is estimated to be $8,250,071. Total funds to reduce tax rate will be $9,199,000. This brings the grand total of revenues for the 2024 fiscal year to $105,257,642.
The amount of free cash the town will have has declined, Keezer said. For the 2023 fiscal year, the town had $10.2 million and for 2024 there is estimated to be $8.5 million.
“In the near future we’re going to run out of free cash or we’re gonna have a significant decrease in free cash, that has happened for this year,” Kezer said.
For expenses, Kezer provided three different scenarios, outling town expenditures with cost increases at 3 percent, 4.5 percent and 6 percent. The 4.5 percent scenario is “middle of the road that we think is probably close to reality,” he said.
The total spending under that scenario would be $108,388,368, leaving the town in a $3.13 million deficit for the next year. He showed the deficits increasing each year with fiscal year 2028 estimating a $15.8 million deficit.
“We are hoping given what the feds are doing today on interest, some indication that the economy is slowing down, inflation will come down, it will improve those numbers, but they’re definitely still going to be negative and they’re still going to be sizable,” Kezer said.
One of the current challenges for the Town right now is the decline of free cash, he said.
“The point has come where we are not replenishing free cash at the rate that we’re spending it and that’s driving a big part of the deficit, so it is significantly hitting revenues,” Kezer said.
Select Board Member Alexa Singer said she felt “frustrated” seeing a structural deficit in the 2024 budget.
“We keep talking about a balanced budget and what that means, but really, we’ve known that there was this significant shortfall coming in 2024 and we’ve been using free cash to bridge the gap,” Singer said.
It is time, Singer said, for the Town to stabilize its budget process and “keep up to date with the capital improvement plan with the five year outlook,” and look at other options for funding. There have also been turnovers in the finance department, she said.
“I also think it’s important to note that we’re not unique, every town has turnovers and it really underscores the need for this board to take an active role in ensuring we’re in line with the best practices of our financial management process,” Singer said.
Chairman Moses Grader said that although this year is very different from past years in terms of the budget, “thankfully we all hired Thatcher Kezer, who has been through this process himself, understands exactly what needs to be done.”