Cuts coming

“This is not sustainable. We know that. Obviously, we’re running out of money.”

This statement from Saratoga Town Council member Jon Nelson illustrated the difficulties facing the Town of Saratoga as they prepare to set the budget for the next fiscal year (FY). With FY 2018/2019 nearing an end, the Saratoga Town Council and Town of Saratoga department heads gathered at Saratoga Town Hall for the second budget workshop in a series to discuss FY 2019/2020.

In preparation for the workshop, Nelson had gathered revenue and expenditures from FY 2014/2015 to FY 2017/2018 along with a four-year average and compared them to the FY 2018/2019 budget. Additionally, Nelson removed funds that were not part of the Town of Saratoga’s regular revenue. This included funds from the One Cent Sales Tax (5th penny tax), impact assistance funds and other funds and grants used for specific purposes such as river maintenance or flood mitigation.

The average revenue between 2014 and 2018 came to a total of approximately $1.3 million while an average of expenditures during that same time came to a total of $2.1 million.

“We know that reserves have been dropping. We’ve been overspending for four solid years,” said Nelson.

Further examination during the workshop showed that, despite the trends over the past four years of expenditures, the FY 2018/2019 budget was set higher than what the four-year average showed was sufficient. Planning and zoning, for example, had been budgeted around $40,000 during the previous four years, but was then budgeted for nearly $100,000 in 2018. Additionally, the police department’s anticipated expenditures were listed at just over $1 million despite their average expenditures running around $830,000.

Nelson further explained that, instead of trying to set a budget passed on the previous year’s budget, he went based on the four-year average of expenditures.

“If you go down the expenditures side…I’m not considering what the budget was last year, at all. I’m just pulling that four-year baseline average of expenditures across. The con of that is that all the numbers go down, meaning that everybody’s looking at budget cuts. The pro of that, on the other hand, is that if we’re realistic about that and they are going to match our actual revenues, then that means when we do set these budgets, there’s going to be money in all the pots,” Nelson said. The ‘game’ of not being able to spend your full budget because there’s no money there to spend it—that’s going to go away. We’re going to set reasonable budgets attached to reasonable revenue and there’s going to be money in the accounts for the other departments.”

To be able to achieve that realistic budget, though, Nelson stated there would have to be more than cuts to what the previous year’s budget had been. There would have to be cuts to last year’s expenditures, which were already well below what the budgeted amounts were. He then brought up a chart that showed a proposed budget for FY 2019/2020 compared to money spent in the previous year.

“This isn’t a budget number versus a budget a number. This is a real expense versus, now, a budgeted expense and, as you’ll see, they’re all still going down which means that we’ve got a hard year ahead of us,” said Nelson.

Councilmember Judy Welton asked Nelson if he had found any specific places in individual line items that could be cut. Nelson replied that he hadn’t found any specific places and that it was the purpose of the workshop to find those areas that could be cut. Councilmember Steve Wilcoxson offered an analogy, stating that it was similar to someone who includes overtime pay in their budget, instead of going based off their base income.

While the Town of Saratoga is expecting revenue from impact funding, that money is already committed and will be placed in a enterprise account. It cannot be placed in the general fund. The same goes for any funding received should the Specific Purpose and Use Tax (6th penny tax) pass in May; the monies raised from that tax could only be used for the specific purpose to which they are committed.

“We can’t take that 6th penny money and smear it around the general fund to make our budgets balance. That has to go into a specific project. So, we can’t touch it for the purpose of balancing our general fund budget,” Nelson said.

Following an hour-and-a-half of discussion, the workshop began to wrap up. Mayor John Zeiger gave the direction to department heads to examine their individual budgets and figure out where they could make cuts.

The next budget workshop for the Town of Saratoga will be at 6 p.m. on April 1 at Saratoga Town Hall.