Article #2: Milton’s Bloated Slush Fund

By S.D. Plissken |  February 29, 2020

A recent post (January 31) on local social media asked a very good question regarding the so-called “fund balance.”

Last year (2019) the Milton Operating Budget was defeated and the Town operated under a Default Budget. The December Expenditure Report shows a surplus of $739,128.00. Will this be used to offset taxes. or will it be used to fund Warrant Articles in 2020?

Audience members at the Deliberative Session asked related questions. For those who did not already know, the official replies tell quite a tale.

The term “fund balance” might suggest that this amount is only what is left over when the necessary budget categories are covered – a sort of rounding error or spare change. That is only partly true.

The NH State Department of Revenue Administration (DRA) “recommends” that Towns collect a tax overage, above and beyond the tax amounts necessary to cover the Town budget. In replies to audience questions, it emerged that the DRA recommendation was formerly to collect an additional 5% to 15%. This year’s proposed budget is $4,562,047.

So, following the DRA’s recommendation would have the Town collecting this year additional funds above the Town budget of between $228,102 (at 5%) and $684,307 (at 15%). In a town with about 2,300 tax properties, that would be an average tax overage of between $99 and $298 per property.

It emerged also that the DRA has in recent years narrowed their recommended tax overage range to something that tops out at about 8%. This narrower range has been implemented already in various other NH towns, towns whose governments are better than ours.

At the Milton Deliberative Session the various members of the Board of Selectmen (BOS) amended any and all articles that gave an estimated tax impact. They replaced those tax impact estimates with – let us not mince words – the same tired old lie about there being no tax impact or, as former Selectman Lucier preferred it, no additional tax impact, as the money would come magically from the unexpended fund balance.

I am not dim enough to fall for that – at least not more than once – but are you? Just as the fictional Soylent Green foodstuff was found ultimately to have been made out of people [!], we discovered last year that fund balances are made out of taxes [!!]. They are simply the DRA’s recommended tax “overages” from last year, over-collected and never returned.

Now, the thing about “recommendations” is that you need not adopt them. Town officials with any concern whatsoever for the taxpayers they supposedly represent would operate always at the lower end of the DRA’s recommended range. They might even disregard the DRA’s bad advice all together. But we have instead $739,128 worth of Soylent Green in our fund balance.

Obviously, we need to elect officials that put our interests – and particularly our ability to pay – before the fevered dreams of Town departments. We have for many years been disappointed by the various boards and committees, perhaps even feeling something akin to betrayal.

The answer to the social media question above – and the whole point of their removing the tax impact language from the various warrant articles – is “YES, this BOS absolutely intends to spend ‘your’ fund balance on warrant articles and not on tax relief.” But only if you are dim enough to vote for their warrant spending.

Despite the stated rationales when it was created, profligate spending is the entire point of having a CIP plan and of overtaxing us to fill magic fund balances. Remember, by definition, government has no “capital,” as such, with which to “plan.” Everything they spend is removed from your pocket.

References:

Calloway, Cab. (1931). Minnie the Moocher. Retrieved from www.youtube.com/watch?v=8mq4UT4VnbE

Heston, Charlton. (1973). Soylent Green Is People! Retrieved from www.youtube.com/watch?v=6zAFA-hamZ0

 

 

 

Author: S.D. Plissken

I thought he'd be taller.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s