Concord ends fiscal year with $1.4 million surplus

Last modified: 11/21/2010 12:00:00 AM
The city of Concord enjoyed a nearly $1.4 million surplus in the last fiscal year, and officials want to squirrel away most of that money for future projects and expenses.

The operating surplus for the budget year that ended June 30 totaled $1.39 million, thanks to 'favorable conditions' and 'diligent budget management by department heads and managers,' wrote Brian LeBrun, deputy city manager for finance, in a report to the city council last month.

The surplus estimate, which has yet to be audited, is nearly twice the $724,000 budget surplus in fiscal 2009 as tallied in the city's annual audit.

But taxpayers shouldn't expect a check in the mail.

The Fiscal Policy Advisory Committee, which is made up of city council members, is recommending that the surplus money be used to bolster reserve funds that pay for things like paving roads and retiree health-insurance costs. Some of the money would be used to pay for immediate projects, including new windows at the police station.

A final decision about what to do with the money is in the hands of the full council, which is scheduled to take up the question at its Dec. 13 meeting.

'It's a good thing to have a surplus at the end of the year in any community, and certainly trying to utilize that surplus effectively to manage issues that may come up in future years is what the council is trying to do,' LeBrun said in a interview Friday.

The city council last summer passed a $46 million general-fund budget for fiscal 2010. At year's end, revenue came in short by $262,000, partially due to an increase in property tax delinquency, according to LeBrun's Oct. 28 report.

But spending came in even lower, estimated at more than $1.8 million under budget. The result is the surplus, plus a one-time movement of $170,000 from an agency fund to the general fund, LeBrun said.

For years, Concord used leftover money as revenue to balance the next year's budget. But the city has stopped that practice in recent years because it hurts the city's credit rating and prevents the creation of a 'true balanced budget,' LeBrun said.

'Concord has gotten away from using surplus to offset the tax rate, which has gotten us in a much sounder financial position,' he said.

The fiscal committee's recommendations for this year's surplus, LeBrun said, represent 'prudent financial sense on the part of the council . . . and looking at trying to take care of needs that the city has and . . . that are going to occur in the future.'

They include a $600,000 contribution to a highway fund that pays for paving projects, $150,000 for a vehicle and equipment fund, and $300,000 for a fund that will cover the city's liability for post-employment benefits like retiree health insurance costs.

An additional $125,000 is earmarked for a fund that covers the cost of a 53rd pay week that, due to a quirk in the fiscal calendar, periodically appears in the city's budget, LeBrun said. The next extra week will appear in fiscal 2012.

Some of the money would pay for projects and training that weren't funded in the current budget.

That includes $75,000 for the police department. Some of that money would be used to replace a number of the aging windows at the headquarters building, 35 Green St., to improve safety and energy efficiency, according to police Chief Robert Barry.

The rest of that appropriation would allow the department to create an emergency dispatch center at the county courthouse, 163 N. Main St., which would 'allow us a backup center at times of emergency,' Barry said. The department's existing dispatch center at the station would remain in regular use.

But not everyone is on board with the surplus plan.

It's all well and good to spend on projects and reserve funds, but most of the surplus money should be returned to the taxpayers, said Chuck Douglas, co-chairman of the Concord Taxpayers Association.

Spending all of it is 'not an appropriate answer to the surplus,' said Douglas, a former congressman and state supreme court justice.

Douglas noted that the city expects to raise $31.4 million in taxes this year, an increase from last year's $30.35 million. Out of the nearly $1.4 million surplus, $1 million could be used to lower the tax rate, he said.

'The people paying the bill ought to get some of the benefit of it,' he said.

(Ben Leubsdorf can be reached at 369-3307 or bleubsdorf@cmonitor.com.)




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