SCHOOL COMMITTEE MEMBER JAMES ARRUDA: "VOTE BUDGET #1 FOR FISCAL SUSTAINABILITY"

On May 16th please consider voting for budget #1 for fiscal sustainability. The petitioner budget has conveniently left out some information while comparing Tiverton to its neighboring communities. Thus far the focus has been on the tax rates of those communities and how Tiverton is much higher, and the answer is to offset the tax increases with taking money out of our general fund. Here is a short list of what other communities have in their respective general fund/reserve account:

Portsmouth – 9% (8% is the town policy but in their Financial Report, dated June 23, 2014, suggests to increase their reserve funds up to 16% as recommended by the Government Finance Officers Association (GFOA). See link for reference: https://urldefense.proofpoint.com/v2/url…)

Little Compton – 12% (A per their policies as reported by their budget committee report to for the Financial Town Meeting. As from the report: targets an unrestricted general fund balance equivalent to 12% of annual budgeted expenses (a level which we believe is appropriate to preserve our Town’s creditworthiness). I will note that this was from May of 2013 for the FY2014 budget and still followed.)

Westport – 3% (I wasn't going to compare a Massachusetts town, but since the petitioner did, so will I. Here is an excerpt from a report done by the Massachusetts Department of Revenue from their Division of Local Services: The board initiated the request because the town’s past practice of
using non-recurring revenues to support ongoing operating expenses is not fiscally sustainable. As a
result, Westport has had significant structural deficits. The date of this report is October 2014) Link: https://urldefense.proofpoint.com/v2/url…

Tiverton – 3% (currently by charter, but a policy was put in place by David Nelson and Rob Coulter to increase the general fund balance by 0.5% per year up to 5.0%)

I included the Westport findings to show the path we are being put on, which is a path of Non-Fiscal Sustainability. We do not want to get in the practice of having to go to bond or to borrow for capital expenditures. So I urge voters to please consider the ramifications of these budgets we will be voting on this Saturday. Our Town Administrator said it best “Don't take from the college fund to by a happy meal so that you can be a hero today, at the cost of sacrificing the future.”

Lastly, as a newly appointed member of the school committee, I also want to point out that All-Day Kindergarten HAS TO BE FUNDED in order to receive the increase in state aid. It is NOT, and I repeat, IS NOT a one time expense. The program has to be budgeted every year in order to receive the additional funds from the state to offset the costs. Saying the school department can just use its reserve funds to fund a re-occurring expense is NOT FISCALLY RESPONSIBLE, especially when there are buildings that need extensive repairs.

James Arruda
Tiverton School Committee