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Town Admin Proposes 9% Town-side Spending Hike

Expenses—including health care, heating oil and an upcoming revaluation mandated by the state—are up and some projects can't be deferred, Town Administrator Karl Kilduff said in a budget message Tuesday to the Board of Selectmen.

If the town budget proposal presented by Town Administrator Karl Kilduff went into effect, the town-side of the next fiscal year's spending would increase by 9 percent to $42,290,583.

That's a hike of $3,492,098, and it includes both the operating budget, the entire debt service budget for bonds the town is paying off, and new capital expenditures on projects like the final installment of funding for a firefighters training facility, state-mandated property revaluation and continued funding for a "heavy rescue capability" for the .

The town school budget takes up the vast majority of town expenditures and the school debt service of $9.2 million is even included in the town-side budget that Kilduff presented.

The is currently digesting Superintendent Stephen Falcone's proposed $80.6 million looking for cuts in his 5.6 percent proposed increase. (After identifying cuts last week, the board is scheduled to hold a public hearing on Tuesday, Feb. 7, in the Auditorium.)

Kilduff sent a formal "transmittal" memorandum to the Board of Selectmen on Tuesday (see the entire memo in seven images attached to this article). The document outlines the changes his proposed budget would make to town spending. He noted in the memo that town department heads had been reasonable in their budget requests, from which he cut $168,872, but that various important projects and costs were largely responsible for his proposed increase.

Kilduff's proposal can be broken down into operating, debt service and capital expenditures:

2011-12 Budget 2012-13 Proposed Increase % Increase Operating Budget $27,209,702 $28,323,773 $1,114,071 4.1% Debt Service $10,095,356 $11,400,186 $1,304,830 12.9% Capital Expenditures $1,493,427 $2,566,624 $1,073,197 71.9% TOTALS $38,798,485 $42,290,583 $3,492,098 9%

 

Driving up the operating budget

 

Kilduff wrote that sources of higher spending in the operating budget include:

  • Unavoidable cost increases like the added expenses of operating the expanded Police Department building (although the town has just begun reaping the benefits of heating the the building with natural gas, as is now done at Town Hall), and the soon-to-be-refurbished Weed Beach (although increased revenues are expected from that park).
  • The town's three fire departments have raised less from the public as a result of the continued slow economy, and they can't continue deferring some expenses and therefore need more money from the town.
  • While the price of electricity is lower as the town has put the contract out to bid, and the town has turned to natural gas for some buildings, prices are high for heating oil, diesel fuel and gasoline.
  • Health insurance costs are rising, although the town will do some comparison shopping with other insurance companies to lessen the rate increases.
  • The Social Services Department has an increased demand for its services.
  • New contracts with the police union and Town Hall unions, together with the cost of a new contract with the public works union, now in arbitration, are expected to increase costs.

 

Increased debt service costs

 

Sewer debt is up by $73,270 (a 5.72 percent increase), the town's Education Department debt is actually down by $106,089, although at $9.2 million, it accounts for 81 percent of total town debt.

The big rise in debt costs is in the town side of the debt budget, which goes up from $176,259 in the current fiscal year to $1,513,908, a hike of $1,337,649.

Kilduff pointedly minimized the added $262,500 resulting from the controversial Shuffle facilities plan to move Darien Public Schools headquarters to the former library building on Leroy Avenue, then move the Senior Center into a new Mather Community Center, partly at the old schools headquarters in the Town Hall building.

Even though Kilduff stated that the Shuffle "accounts for $262,500 of the increase for debt service (or 2.3 percent of the total debt service expense)," that extra debt accounts for 20 percent of the $1.3 million increase in debt service overall.

But more of the debt is a result of the Weed Beach refurbishing project and the Police Department building expansion.

 

More spending on capital projects

 

"Critical investments in the town's infrastructure must still be made—even during an economic downturn," Kilduff wrote. "[O]pportunities to make operations more efficient should be assessed and funded as appropriate."

Kilduff mentioned these projects as some of the reasons the capital expenditures budget increased by 1,073,197, or 71.9 percent:

  • State mandated property revaluation must be done in time for the Oct. 1, 2013 Grand List.
  • A grant of $210,000 for the fire departments' training facility must now be joined by town government spending.
  • Parking lots should be refurbished to help downtown merchants. (The Public Works Department budget includes money to refurbish the Leroy Avenue East and West parking lots and, on the other side of the Post Road, the North Center Street lot.)

The Board of Selectmen started reviewing Kilduff's proposed budget last week while meeting with various department heads to get further details. Those meetings continue this week, with the next one tonight at 7:30 in Room 206.

For a copy of the proposed budget and other budget documents and meeting schedules, see "".

Correction: Superintendent Stephen Falcone's proposed education budget is $80.5 million, as this article now states, not the 73.6 million originally stated here.

Jim Coley February 01, 2012 at 01:54 PM
Sorry to be so negative, but 9% tax hikes on top of what is coming on the Federal side (CBO indicated yesterday that federal taxes are projected to increase by 30% of the next two years, especially on higher income earners which will certainly impact Darien residents) in simply foolish in this economic environment. While I understand that some of these increases are 'built in', town officials and the RTM should be aggressively pursuing cuts in other programs and/or target revenue generating policies that directly relate to particular services. The MATH is unsustainable; at 9% increases, taxes will have to double every 8 years. As the population ages, you will force retirees out of Darien, thereby creating an exodus which will be hard to offset given the demise of the financial services industry. We should not be so short-sighted to think we can just continue to increase taxes at this clip. The way of the near term future is to be fiscally conservative.
Michael Brennan February 01, 2012 at 02:20 PM
Agree wholeheartedly with Jim, although you forgot to include state taxes which will continue to increase. You can only go to the taxpayer well so many times before it runs dry.
David Gurliacci (Editor) February 01, 2012 at 03:11 PM
The 9 percent spending increase, if it passes the Board of Selectmen, Board of Finance and Representative Town Meeting, represents a fraction of overall town spending. The town-side budget would then be $42.3 million. The education side of the budget (if no cuts are made in the superintendent's proposal) would be $80.6 million (itself a 5.6 percent increase). Total proposed budget: $122.9 million. Total proposed increase: $7.8 million, a 6.3 percent increase, roughly (I've done some rounding.) I didn't think to add that to the story, but it probably would have been useful. Normally, the boards cut these proposals.
Jim Coley February 01, 2012 at 03:37 PM
David, Thanks for pointing that out--so the 9% increase will not necessarily translate in a 9% increase in the mill rate. My original thought, though, is still in tact in that local governments need to be very careful as to tax increases given the increasing Federal burden and as Michael Brennan correctly pointed out, most likely increases at the State level.
Jim McCann February 01, 2012 at 04:34 PM
Overall growth rates in debt service/capex are scary looking out three years ad assuming that real estate values decline or even stay flat............
Vickie Riccardo February 01, 2012 at 05:39 PM
"Kilduff pointedly minimized the added $262,500 resulting from the controversial Shuffle facilities plan ..." For many who are concerned about the Town's aggregating capital costs and related debt service, the Shuffle was the last straw. Growing from a $3.5 million idea to a $7 million appropriation, it was seen as a too expensive/complicated means to replace our crumbling Senior Center. By the numbers, the Shuffle was soundly rejected by Darien's taxpayers, and prevails only due to the Charter's super-majority requirement for a successful referendum. The BOS and BOE face tough choices about what Darien can and can't offer in light of choices they have already made. Is scaling back the Shuffle by keeping the BOE in its current HQ and renovating vacant Town Hall space for a Senior Center a reasonable choice, when also considering the longer term growth rates in debt service that the Shuffle, Police Station and Weed Beach projects represent? The Station and Weed Beach improvements are nearly complete. We can't turn back. But Shuffle construction hasn't begun yet. Other views?
Debra Ritchie February 01, 2012 at 06:38 PM
Yes, the shuffle debt service is forecasted to be 0.6% of the total proposed BOS budget and a mere 0.2% of the total town budget including the proposed BOE budget. When you do a complete analysis, eliminating the shuffle debt service in 2012-13 will have little impact on the overall proposed BOS budget. In fact the proposed BOS budget still goes up by 8.3% without shuffle debt service. We may not be able to "turn back" on Weed Beach and the Police Station, but we can certainly strive to achieve better operating efficiencies when possible. Both of those projects result in higher opertating costs to the town whereas the future shuffle project does not.
John Sini February 01, 2012 at 06:43 PM
Vickie, I’m sorry you are having trouble accepting the fact that Darien operates under a representative government. All necessary branches of the town's government approved the facilities transfer (including the RTM by a 2:1 margin). Moreover, subsequent to the RTM vote there was a town-wide election during which the shuffle was hotly debated. Those candidates that opposed the shuffle lost the election by an overwhelming 2:1 margin (in some cases, more). Finally, there was the referendum effort which subsequently failed due to lack of voter participation (a participation requirement that has been cleared by wide margins in previous referendums). Now, there's many a reason our charter requires a MINIMUM number of voters to overturn the RTM’s decision (NOT a super-majority as you falsely claim). The most important one is so the town isn't forced through a referendum effort every time a minority of voters disagrees with the final product that our elected officials deliver. Voters have had many a chance to make adjustments in this town’s direction over the years through elections -- including a chance to revise the Charter during a relatively recent general election. Voters resoundingly decided a Charter change wasn’t needed. I suggest you begin to accept those facts and move beyond simply focusing on 0.2% of the proposed Town Budget, but look for more meaningful ways to address the pressing budget issue
John Sini February 01, 2012 at 06:52 PM
Vickie also fails to mention the BOS would have had to make some sort of other repairs or arrangements for the senior center, which might not have been capitalized, perhaps having an even greater than 0.2% impact to this year's budget.
James Palen February 02, 2012 at 03:48 AM
Vickie continues to focus almost exclusively on the 0.2% of the budget related to the debt service associated with the capital cost of the facilities program even though a portion of that amount would have been spent regardless of the proposed project due to necessary repairs and deferred maintenance on the senior center. I find it quite interesting that there is no mention of the items that actually drive the largest dollars in our taxes. Operating costs continue to rise and drive perpetual increases in our taxes. New Police Stations, Senior Centers, Schools and Public Beaches are assets per se on the town's balance sheet and although they depreciate, the rate of depreciation is nowhere near the rate that the town amortizes it's debt - we call that deleveraging. The persistent increases in the operating expenses, namely those in the BOE budget, are what drive higher long-term taxes --- not a "new" senior center or a "new" investment in our schools such as an elementary foreign language program. This misdirected focus exists in both Hartford, CT and Washington, DC and is one of the reasons why there are so many problems.
sebastian dangerfield February 02, 2012 at 06:27 AM
Yes-- The budget is nearly set in stone, save for one item. The Shuffle. The push for affordable housing at 35 leroy has gone on long enough. Mrs Klein forgot to count the moratorium points and used a moratorium as the bait to get AH there. Then the option to lease. Then the one developer who bid--good enough--- then years of an inability to focus on anything but that property--and after every weapon in their arsenal is used, including a referendum, they still need to focus on one thing-and one thing only. Democrats--please--you guys lost this one. Its time to move on. It was time to move on in 2009 when the majority turned.
Vickie Riccardo February 02, 2012 at 05:53 PM
My point: The Shuffle is one more thing topping a mountain of increasing capital and operating expenses that accumulate based on our elected officials’ decisions. Those decisions, many good, some bad, are made. Done. Now we face the consequences. How big should the pie be? Who eats and who starves as the pie is divided? Darien has a terrible history of deferring maintenance on its facilities. The Senior Center is in lousy shape because our officials didn't maintain and update it properly for two decades. Done. Contrary to Mr. Sini’s assertion, I suggested an alternative to leaving the Senior Center in its current, deplorable condition, which (yes, John) will cost money. But less than the Shuffle because it doesn’t include moving the BOE to an expensive, new HQ at 35 Leroy. I agree it shouldn’t be easy to override decisions made by our government representatives, and that there should be some minimum turn-out threshold for referendums. I think our 1959 Charter’s protective provision is excessive, but that’s my opinion. The majority constituting > 25% rule remains in force, and is the reason the Shuffle vote failed. That does not, however, wipe away the fact that more people rejected the Shuffle than approved it, which offers some cover if our elected officials (thinking short and long term) decide it’s prudent to find a way to scale back.
Joe Pankowski February 02, 2012 at 06:03 PM
Ms. Riccardo: Your statement "more people rejected the Shuffle than approved it" is simply not factually accurate. On December 13, the "Stop the Shuffle" group had to get 3,100 people to show up and vote "No" in order to overturn the 58-28 vote of the RTM which approved the bonding of the Shuffle. The referendum failed by more than 600 votes. The Shuffle is moving forward and our town will have a wonderful new Community Center opening in the summer of 2013. I'm hoping our town can now move beyond the referendum, too.
John Sini February 02, 2012 at 06:31 PM
Vickie, you fail to acknowledge that as the referendum rules stand, for those that supported the overturn of the RTM's decision there was a MUCH greater incentive for people to vote (and also get out the vote) to reach their objective versus those who content with the status quo. It is a bit disingenuous to imply that the tally the failed referendum effort reflects the overall will of the taxpayer at the same time ignore the overwhelming results of both the RTM vote and the general election a few weeks prior, when, as you well know, the topic was very publicly debated. Just think, in effect you are asking this BOS to unilaterally ignore the votes of the BOF and RTM which approved the plan to move forward with the facilities transfer. Ironically, the Clock Hill Homes affordable housing complex faced a referendum back in its planning stages. Interestingly, that referendum also failed due to lack of voter participation -- despite a 2-1 vote against the plans for the development. I’m pleased that the First Selectwoman at the time decided to pursue the right course of action (despite the meaningless referendum tally) and I encourage the current BOS to do the same with this project.
sebastian dangerfield February 02, 2012 at 07:00 PM
I think Riccardo's statement that more people rejected the shuffle than voted for it is true. Not sure how you can say its factually inaccurate. That being said, I think the true statement is: " that not enough people cared about the shuffle one way or another to vote." They simply dont care about 250k spread amongst nearly 7,000 taxpaying property owners or 35 dollars a year. (3 bucks a month). If home ownership in Darien is affected by a 3 dollar a month charge -and this is the ONE thing that the extreme dems are trying to point to--then I think the safe conclusion is that extremist faction of the dems in Darien--the Klein loyalists-are far more interested in obtaining a feather in their cap, than treating the senior citizens with any measure of dignity. That property will always be argued about disingenuously. (by both sides by the way). The thing is--its gone. Ms riccardo wants to argue that what is done is done (not so much as to actually agree-but to avoid the legitimate questions about fiscal responsibility with resepct to all other capital projects.) Its Done. Move on.
Joe Pankowski February 02, 2012 at 07:25 PM
Luca: we'll agree to disagree on Ms. Riccardo's statement. The fact that 2,400 people showed up to vote "No" doesn't mean that "more people rejected the Shuffle than approved of it." More "voters" did, surely. However, the majority of Darien's eligible voters didn't vote at all, suggesting (as you note) either not caring about the Shuffle or, just perhaps, approving of the RTM's 58-28 vote.

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