{"id":3064,"date":"2022-07-05T17:29:14","date_gmt":"2022-07-05T21:29:14","guid":{"rendered":"https:\/\/norwichobserver.com\/?p=3064"},"modified":"2022-07-05T17:29:16","modified_gmt":"2022-07-05T21:29:16","slug":"town-projects-budget-surplus-of-250000-no-plans-to-use-cash-for-property-tax-relief-or-employee-retention-bonuses","status":"publish","type":"post","link":"https:\/\/norwichobserver.com\/index.php\/2022\/07\/05\/town-projects-budget-surplus-of-250000-no-plans-to-use-cash-for-property-tax-relief-or-employee-retention-bonuses\/","title":{"rendered":"Town projects budget surplus of $250,000. No  plans to use cash for property tax relief or employee retention bonuses."},"content":{"rendered":"\n<p><\/p>\n\n\n\n<figure class=\"wp-block-image size-full is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/norwichobserver.com\/wp-content\/uploads\/2022\/06\/m2i8N4m2i8b1A0i8.jpg\" alt=\"\" class=\"wp-image-3066\" width=\"440\" height=\"270\" srcset=\"https:\/\/norwichobserver.com\/wp-content\/uploads\/2022\/06\/m2i8N4m2i8b1A0i8.jpg 720w, https:\/\/norwichobserver.com\/wp-content\/uploads\/2022\/06\/m2i8N4m2i8b1A0i8-300x185.jpg 300w\" sizes=\"auto, (max-width: 440px) 100vw, 440px\" \/><\/figure>\n\n\n\n<p>The Town projects to have a budget surplus of $250,000 for the fiscal year that ended on June 30, 2022.  At its June 22, 2022 meeting, the Selectboard passed on two suggestions for using that money. One was to pay bonuses to current employees. The other, returning money to taxpayers. <\/p>\n\n\n\n<p>The lack any real interest in either topic mystifies me. As detailed below, the Town is flush with cash. However, some Selectboard members noted concerns about future expenses. Apparently. Tracy Hall and the DPW garage need major renovations. <\/p>\n\n\n\n<p>But, keeping Town employees is important too. As is returning surplus funds to its owners &#8211; taxpayers.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Numbers <\/h4>\n\n\n\n<h5 class=\"wp-block-heading\">Awash In Cash<\/h5>\n\n\n\n<p>By my count, the Town is sitting on <em><strong>excess<\/strong><\/em> cash reserves of nearly $400,000.<\/p>\n\n\n\n<p>Finance Director Fielding Essensa spoke about the anticipated $250,000 surplus at the June 22 Selectboard meeting. See <a href=\"http:\/\/norwich.vt.us\/wp-content\/uploads\/2022\/06\/draft-minutes-062222.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">draft meeting minutes<\/a>. He also indicated the money mostly came from not paying wages and benefits for staff positions that went unfilled. <\/p>\n\n\n\n<p>In addition, he mentioned the Town had an existing surplus of  roughly $1.1 million. See <a href=\"https:\/\/catv.cablecast.tv\/CablecastPublicSite\/show\/24775?channel=2\" target=\"_blank\" rel=\"noreferrer noopener\">CATV<\/a>, discussion begins at 1:34:00. My understanding is that the million dollar number is an audited figure.  Audit is <a href=\"http:\/\/norwich.vt.us\/wp-content\/uploads\/2022\/03\/FY2021-Audit-Report.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">here<\/a>.<\/p>\n\n\n\n<p>The surplus of $250,000 is a projection, not a final number. Moreover, if a large, unanticipated invoice showed up between June 22 and June 30, the surplus gets reduced. An independent audit is several months away.<br><br>All told, the Town likely holds surplus cash of over $1.3 million. [$1,100,000 (existing surplus) + $250,000 (anticipated surplus)]. <\/p>\n\n\n\n<p>However, my understandable is that some, but not all, of that money is spoken for.  Voters approved shifting $110,000 to the Operational Performance and Development Fund at Town Meeting. See <a href=\"http:\/\/norwich.vt.us\/wp-content\/uploads\/2022\/03\/2022-Town-Mtg-Election-Results.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">Election Results<\/a> at Article 8.<\/p>\n\n\n\n<p>In addition, the Town maintains an Unanticipated Expenses and Emergency Reserve Fund. Town policy says an amount &#8220;between 12-16 percent&#8221; of the annual budget should be held there.  See <a href=\"http:\/\/norwich.vt.us\/wp-content\/uploads\/2021\/03\/Master-Financial-Policy-signed-11-18-2020-w-amended-Fund-Bal-Policy.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">Master Financial Policy<\/a> at 30;  <a href=\"http:\/\/norwich.vt.us\/wp-content\/uploads\/2022\/03\/2022-Town-Mtg-Election-Results.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">Election Results<\/a> at Article 7. The annual budget for the current fiscal year is $4,958,865. Thus, at the high end end the Town wants a emergency fund of about $795,000. [$4,958,865 x 16%].<\/p>\n\n\n\n<p>To sum up, $110,000 goes to the  Operational Performance and Development Fund and a max of $795,000 to the Unanticipated Expenses and Emergency Reserve Fund. Therefore, it seems  that from the cash surplus of $1.3 million, the Town has <em>excess<\/em> reserves of $395,000. Fun money?<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Retention bonuses<\/h5>\n\n\n\n<p>A retention bonus is a bonus paid to current employees. It is a lump sum of money an organization &#8220;pays to an employee to stay with the company for a specific amount of time,&#8221; according to the <a href=\"https:\/\/www.indeed.com\/career-advice\/pay-salary\/retention-bonus\" target=\"_blank\" rel=\"noreferrer noopener\">job website Indeed<\/a>. &#8220;Generally, companies create a contract specifying how long the employee will remain with the company in exchange for the bonus amount.&#8221;<\/p>\n\n\n\n<p>The Selectboard in Berlin, VT recently approved retention incentives totaling $9,000 to the three remaining members of its DPW, according to a <a href=\"https:\/\/www.timesargus.com\/news\/local\/road-crew-get-retention-incentives-in-berlin\/article_fd43c730-2265-570c-b4ec-abbb41511f07.html\" target=\"_blank\" rel=\"noreferrer noopener\">June 21 article<\/a> in the <a href=\"https:\/\/www.timesargus.com\/news\/local\/road-crew-get-retention-incentives-in-berlin\/article_fd43c730-2265-570c-b4ec-abbb41511f07.html\" target=\"_blank\" rel=\"noreferrer noopener\">Times Argus<\/a>. The Town Administrator told the Board it could use money the town received under the American Rescue Plan Act (ARPA), said the article. Also, the State is paying some of its employees a $1500 bonus if they stick around through January, as part of a new union contract, according to a <a href=\"https:\/\/www.wcax.com\/2022\/06\/22\/vermont-state-employees-contract-offers-pay-hike-retention-incentive\/\" target=\"_blank\" rel=\"noreferrer noopener\">WCAX report <\/a>on June 22.<\/p>\n\n\n\n<p>What would bonuses to current Norwich employees cost? The Town &#8220;has a total payroll of $1,600,000 covering 22 full-time and 30 part-time or seasonal employees,&#8221; according to an RFQ recently approved by the Selectboard. See <a href=\"http:\/\/norwich.vt.us\/wp-content\/uploads\/2022\/05\/packet-2022_0525.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">Selectboard packet for May 25, 2022<\/a> at 75.  So \u2026 an across-the-board bonus of 5% bonus costs the Town $80,000.  Ten percent is $160,000.  A $2000 bonus to every full-time employee costs $44,000. <\/p>\n\n\n\n<p>As noted above, the Town has excess surplus cash to pay such sums. Further, it was the Finance Director that broached the topic of paying bonuses to employees at the June 22 SB meeting. He did not mention any dollar amounts. However, no other public official took up the issue. <\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Taxpayer Relief<\/h5>\n\n\n\n<p>At the June 22 meeting, a resident suggested that the anticipated surplus of $250,000 go back to taxpayers. Makes sense to me. At the risk of sounding like a Tea Party convert, a budget surplus is not to fund future projects. Voters approved a budget and taxpayers funded it. If the money is not spent, then return it.<\/p>\n\n\n\n<p>The topic did not generate much discussion from the Selectboard. No Board member supported a buy down of the tax rate or other taxpayer relief. <\/p>\n\n\n\n<p>For this tax year the Town Manager is proposing to increase the municipal tax rate by about 5%. From 0.5659 to 0.5940. Using $75,000 of surplus &#8220;buys down&#8221; the tax rate by about one penny. By my math, taxpayers see no increase in the tax rate if Town officials used about $217,000 to buy down the tax rate. <br><\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Voter approval <\/h4>\n\n\n\n<p>Once the fiscal year closes, it is too late to use any anticipated surplus from that fiscal year  to pay employee bonuses. Thereafter, voter approval is necessary for that purpose, and likely for tax relief. It is now too late to put the measure on the ballot for August. Some forethought could have resulted in August ballot measures. However, as the discussion (or lack thereof) on June 22 indicates, using the money for employee bonuses or property tax relief is not a topic of particular interest to the Selectboard or Town Manager.<\/p>\n\n\n\n<h2 class=\"has-text-align-center wp-block-heading\">*  *  *<\/h2>\n\n\n\n<p class=\"has-text-align-center has-blue-color has-light-gray-background-color has-text-color has-background\"><em>Contact the Norwich Observer at norwichobserver{AT}gmail.com.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Town projects to have a budget surplus of $250,000 for the fiscal year that ended on June 30, 2022. At its June 22, 2022 meeting, the Selectboard passed on two suggestions for using that money. One was to pay bonuses to current employees. The other, returning money to taxpayers. The lack any real interest in either topic mystifies me. As detailed below, the Town is flush with cash. However, some Selectboard members noted concerns about future expenses. Apparently. Tracy <a class=\"more-link\" href=\"https:\/\/norwichobserver.com\/index.php\/2022\/07\/05\/town-projects-budget-surplus-of-250000-no-plans-to-use-cash-for-property-tax-relief-or-employee-retention-bonuses\/\">Continue reading <span class=\"screen-reader-text\">  Town projects budget surplus of $250,000. No  plans to use cash for property tax relief or employee retention bonuses.<\/span><span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":3066,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[74,13,29,22,78],"tags":[],"class_list":["post-3064","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-article-7-2022","category-budget-town","category-property-tax","category-undesignated-fund-town-finance","category-workplace-issues"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Town projects budget surplus of $250,000. No plans to use cash for property tax relief or employee retention bonuses. - Norwich Observer<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/norwichobserver.com\/index.php\/2022\/07\/05\/town-projects-budget-surplus-of-250000-no-plans-to-use-cash-for-property-tax-relief-or-employee-retention-bonuses\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Town projects budget surplus of $250,000. No plans to use cash for property tax relief or employee retention bonuses. - Norwich Observer\" \/>\n<meta property=\"og:description\" content=\"The Town projects to have a budget surplus of $250,000 for the fiscal year that ended on June 30, 2022. At its June 22, 2022 meeting, the Selectboard passed on two suggestions for using that money. One was to pay bonuses to current employees. The other, returning money to taxpayers. The lack any real interest in either topic mystifies me. As detailed below, the Town is flush with cash. However, some Selectboard members noted concerns about future expenses. Apparently. Tracy Continue reading  Town projects budget surplus of $250,000. 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No plans to use cash for property tax relief or employee retention bonuses. - Norwich Observer","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/norwichobserver.com\/index.php\/2022\/07\/05\/town-projects-budget-surplus-of-250000-no-plans-to-use-cash-for-property-tax-relief-or-employee-retention-bonuses\/","og_locale":"en_US","og_type":"article","og_title":"Town projects budget surplus of $250,000. No plans to use cash for property tax relief or employee retention bonuses. - Norwich Observer","og_description":"The Town projects to have a budget surplus of $250,000 for the fiscal year that ended on June 30, 2022. At its June 22, 2022 meeting, the Selectboard passed on two suggestions for using that money. One was to pay bonuses to current employees. The other, returning money to taxpayers. The lack any real interest in either topic mystifies me. As detailed below, the Town is flush with cash. However, some Selectboard members noted concerns about future expenses. Apparently. Tracy Continue reading  Town projects budget surplus of $250,000. 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