Town Budgets Mild Winter

[Chubby]

Think of all the surplus in the municipal budgets with no snowplowing and unusually warm weather this winter reducing heating costs. How soon will the taxpayers... never mind.

[John Mercier]

Unused funds would be rolled over into next years budgets under most cases...
Not sure if the City works like that, but all the towns should.

The budget you approve is not the amount to be raised in taxation all the time, many times it is top line and does not include offsets.

[TiltonBB]

Many department heads spend every dollar allotted in their annual budget and return little or nothing to the general fund at the end of the fiscal year. They do it so that it will look like the entire amount was needed to keep the amount for the next year from being reduced. It would not surprise me if DPW heads do the same thing after a mild winter.

I was on a call fire department for 25 years and every end of budget year saw a flurry of purchases, many that were not absolutely necessary. Some things that were purchased were not needed at all, but the money was spent anyway.

[tis]

Originally Posted by TiltonBB

Many department heads spend every dollar allotted in their annual budget and return little or nothing to the general fund at the end of the fiscal year. They do it so that it will look like the entire amount was needed to keep the amount for the next year from being reduced. It would not surprise me if DPW heads do the same thing after a mild winter.

I was on a call fire department for 25 years and every end of budget year saw a flurry of purchases, many that were not absolutely necessary. Some things that were purchased were not needed at all, but the money was spent anyway.

You are absolutely right. They don't want their budgets to be reduced for the next year so they find a way to spend what was alloted for the present year. It starts at the federal government and goes right down to local.

[garysanfran]

Originally Posted by tis

You are absolutely right. They don't want their budgets to be reduced for the next year so they find a way to spend what was allocated for the present year. It starts at the federal government and goes right down to local.

This practice should audited and the taxpayers should insist on it.

[JayR]

Originally Posted by tis

You are absolutely right. They don't want their budgets to be reduced for the next year so they find a way to spend what was allocated for the present year. It starts at the federal government and goes right down to local.

The government wastes so much of our money, Tis had to go and post that comment TWICE and I completely agree!!

[tis]

Originally Posted by JayR

The government wastes so much of our money, Tis had to go and post that comment TWICE and I completely agree!!

Indeed!! Thanks though, I deleted one of them because I didn't realize I posted twice.

[John Mercier]

Originally Posted by garysanfran

This practice should audited and the taxpayers should insist on it.

I guess it depends on the town. Ours internally and externally audits.
Our road manager generally goes before the BoS at the end of spring, and requests that left over funds be allocated to specific road repairs and material from unforeseen spring related damage.

[Major]

Originally Posted by John Mercier

I guess it depends on the town. Ours internally and externally audits.
Our road manager generally goes before the BoS at the end of spring, and requests that left over funds be allocated to specific road repairs and material from unforeseen spring related damage.

John, it seems like you live in a very transparent and well-run town.

My experience with State and Federal governments is different. In the off chance we had money left over in the National Guard (fiscal year ending September 30th), we had strict instructions to spend EVERY penny for fear of not being allocated a similar or greater amount next year. This meant that if there was a conference in Hawaii, you had a green light to attend. The thought of giving the money back to the treasury wasn't there.

It would be interesting to know how Laconia treats this type of situation.

[tis]

Originally Posted by Major

John, it seems like you live in a very transparent and well-run town.

My experience with State and Federal governments is different. In the off chance we had money left over in the National Guard (fiscal year ending September 30th), we had strict instructions to spend EVERY penny for fear of not being allocated a similar or greater amount next year. This meant that if there was a conference in Hawaii, you had a green light to attend. The thought of giving the money back to the treasury wasn't there.

It would be interesting to know how Laconia treats this type of situation.

Exactly right. They are not going to announce it. And it might not be wasted, it might be something they will use in the future. But just to spend money to make sure your budget doesn't get lowered the next year isn't the way it should be---but it is.

[VitaBene]

Originally Posted by John Mercier

I guess it depends on the town. Ours internally and externally audits.
Our road manager generally goes before the BoS at the end of spring, and requests that left over funds be allocated to specific road repairs and material from unforeseen spring related damage.

That sounds magical... Shangri-La?

[Descant]

Originally Posted by John Mercier

I guess it depends on the town. Ours internally and externally audits.
Our road manager generally goes before the BoS at the end of spring, and requests that left over funds be allocated to specific road repairs and material from unforeseen spring related damage.

Similar here (Merrimack). We're on a July 1 fiscal year, so we can see better what needs are and have last quarter planning, compared to a 12/31 fiscal year where you are spending in January, hoping to pass a budget in March, and maybe using Tax Anticipation Notes (TAN). Years ago, we put money for capital reserve funds in the operating budget. These line items gave the BOS flexibility in when to add to the CRF and perhaps add to the salt fund in a mild winter. Now, DRA requires (maybe they always did?) that CRF contributions be a separate special warrant article. The danger there is that if voters don't want to add to a particular CRF, they might vote "no" and kill contributions to all CRF.

For those that don't know, the NH General Court has a group called the Legislative Budget Assistant. They do audits of each department, and give legislators an analysis on the fiscal impact of proposed legislation. Less well known is that they do "performance audits" to see if departments really need all their employees, or if they need more in places where the legislature needs to authorize more and if existing laws need to be updated. Little known, but valuable service. Note that, in our citizen legislature we have a large number of experts from doctors to carpenters with hands on experience, where many states fill their legislatures with lawyers. I'm proud of how we manage ourselves in NH.

[John Mercier]

We also have TransparentNH.
It is a bit wonky as you have to understand the buying process that goes into much of what you are seeing...

[John Mercier]

Originally Posted by VitaBene

That sounds magical... Shangri-La?

No. I think it is the way the department heads try to keep from getting themselves in a bind.

[tis]

I think most towns have audits but that doesn't prevent a department from buying a lot of stuff ahead if they see their budget is below expectations. If you don't think it happens you are naive and your town (or school or state or fed )is indeed called Shangrai La. When I personally witnessed it, I never would have realized if they hadn't told me what they were doing.

[Descant]

Originally Posted by tis

I think most towns have audits but that doesn't prevent a department from buying a lot of stuff ahead if they see their budget is below expectations. If you don't think it happens you are naive and your town (or school or state or fed )is indeed called Shangrai La. When I personally witnessed it, I never would have realized if they hadn't told me what they were doing.

Yes, outside auditors review towns, schools, village district's books. This is mostly for accuracy of accounting, not for propriety of activity. So, yes, they would detect embezzlement, but if the school buys 200 pencil sharpeners when they only need 20, I'm not so sure. The same applies if, when there are salt funds left from a mild winter, and extra paving is done, I don't think it would raise an eyebrow as it is all within the purview of the department, and there is no personal gain by any individual. (In the old days, we paid an individual $3000/year to be the "road agent" but rented plows and graders , etc from the same individual, since Jim owned the only grader in town. Love our small towns.)
The irony is, a politician pledges to keep a sharp eye on the budget, but when s/he is up for re-election, the voters want to hear that s/he built them a new bridge and brought in 400 new jobs.

[John Mercier]

Originally Posted by tis

I think most towns have audits but that doesn't prevent a department from buying a lot of stuff ahead if they see their budget is below expectations. If you don't think it happens you are naive and your town (or school or state or fed )is indeed called Shangrai La. When I personally witnessed it, I never would have realized if they hadn't told me what they were doing.

So when you do an audit... you can't see an unusually high expenditure level in the last quarter? Or you don't think to question it?

You had to be told...

[John Mercier]

Originally Posted by Descant

Yes, outside auditors review towns, schools, village district's books. This is mostly for accuracy of accounting, not for propriety of activity. So, yes, they would detect embezzlement, but if the school buys 200 pencil sharpeners when they only need 20, I'm not so sure. The same applies if, when there are salt funds left from a mild winter, and extra paving is done, I don't think it would raise an eyebrow as it is all within the purview of the department, and there is no personal gain by any individual. (In the old days, we paid an individual $3000/year to be the "road agent" but rented plows and graders , etc from the same individual, since Jim owned the only grader in town. Love our small towns.)
The irony is, a politician pledges to keep a sharp eye on the budget, but when s/he is up for re-election, the voters want to hear that s/he built them a new bridge and brought in 400 new jobs.

200 pencil sharpeners when you only needed 20 should show in inventory acceleration.

[tis]

Originally Posted by John Mercier

So when you do an audit... you can't see an unusually high expenditure level in the last quarter? Or you don't think to question it?

You had to be told...

Not necessarily. You know yourself, if you are building house, you have big expenditures in lumps. Framing, roofing, window package etc. I doubt if an auditor would know much about how purchases happen. If it was sudden a huge sum at the end, like hundreds of thousands, they might question it but other than that, no I don't think an auditor would catch it. A library might have a big purchase of book. Public works could have a big salt purchase. It could be anything.

[Blue Thunder]

I retired 4 years ago as Superintendent of the DPW in my town (34 years).
In Mass, the laws regarding Snow and Ice expenditures are very strict. S&I funds are appropriated separately at the Annual Town Meeting in the Spring. There are pretty stiff restrictions on the types of expenditures that can be made. Obviously, Sand, Salt, Liquid Calcium, Cutting Edges, Repairs to S&I related equipment, Hired Contractors, and payroll overtime were considered appropriate expenditures. There are others, of course, but they had to be directly related to Snow and Ice removal. When the Town is audited annually, close scrutiny is given to these expenses.
Any surplus funds are turned back in. They either revert to what is called “Free Cash” which can only be appropriated at a Town Meeting or they can be transferred to other municipal accounts that may be experiencing a shortfall, again, only by a vote of Town Meeting.
The Department of Revenue (DOR) has rules about S&I funding. A town must appropriate an equal to or greater amount of S&I funding each year in order to over expend S&I appropriations during a bad winter and funding runs out. This allows the town to carry forward those extra costs into the next fiscal year if necessary.

BT

[TiltonBB]

As an example of waste, I may have the year wrong but this occurred 10 to 15 years ago in the town where I was a Call Firefighter. We had excellent equipment and the last two pumpers bought were purchased in the previous 10 years. We really didn't need anything newer.

The Federal Government had a one year program that if you bought one fire truck you would get the second one paid for with Federal dollars. The Chief convinced the Selectmen that the deal was too good to pass up so we got two new trucks that we really didn't need.

There are many available examples of Government waste, both in equipment and personnel. In my opinion, more of a private industry perspective is needed in the Government. Yet, we keep electing the same career politicians, many of whom are not qualified to run a Dairy Queen.

[tis]

Originally Posted by TiltonBB

As an example of waste, I may have the year wrong but this occurred 10 to 15 years ago in the town where I was a Call Firefighter. We had excellent equipment and the last two pumpers bought were purchased in the previous 10 years. We really didn't need anything newer.

The Federal Government had a one year program that if you bought one fire truck you would get the second one paid for with Federal dollars. The Chief convinced the Selectmen that the deal was too good to pass up so we got two new trucks that we really didn't need.

There are many available examples of Government waste, both in equipment and personnel. In my opinion, more of a private industry perspective is needed in the Government. Yet, we keep electing the same career politicians, many of whom are not qualified to run a Dairy Queen.

Most of whom couldn't even run a lemonade stand successfully.

[John Mercier]

Originally Posted by tis

Not necessarily. You know yourself, if you are building house, you have big expenditures in lumps. Framing, roofing, window package etc. I doubt if an auditor would know much about how purchases happen. If it was sudden a huge sum at the end, like hundreds of thousands, they might question it but other than that, no I don't think an auditor would catch it. A library might have a big purchase of book. Public works could have a big salt purchase. It could be anything.

I get audited every quarter, and a deep outside audit at the end of the year, but when you are building a home... since the price is usually contracted... any extra expenditure is a loss to your bottom line.
I am sure the department heads would be very frugal if they got to keep the money like we do when building homes.

They act like a non-profit... so using a profit-driven model as a comparison isn't really accurate.

[John Mercier]

Originally Posted by TiltonBB

As an example of waste, I may have the year wrong but this occurred 10 to 15 years ago in the town where I was a Call Firefighter. We had excellent equipment and the last two pumpers bought were purchased in the previous 10 years. We really didn't need anything newer.

The Federal Government had a one year program that if you bought one fire truck you would get the second one paid for with Federal dollars. The Chief convinced the Selectmen that the deal was too good to pass up so we got two new trucks that we really didn't need.

There are many available examples of Government waste, both in equipment and personnel. In my opinion, more of a private industry perspective is needed in the Government. Yet, we keep electing the same career politicians, many of whom are not qualified to run a Dairy Queen.

We use a specially funded CRF. They are careful not to waste it, because it doesn't get replenished by taxpayers.

[LIforrelaxin]

In all forms of government there is waste. Anyone that doesn't believe so or believes they live in a community that is better then the rest is fooling themselves. The question is how visible is the waste, and can it be sheltered from sight.

Sometimes the waste in way of capital expenditures, sometimes it is in the way of personal that is not needed... in the end it isn't the purpose of an audit to point out the waste, Audits on ensure that the money was spent for the items it was appropriated for, and that all the money is accounted for.

If 100% of every towns budget was audited I would be surprised. Auditing is often done at a high level... leaving plenty of low level ways to hide and misuse money...

[tis]

Originally Posted by John Mercier

I get audited every quarter, and a deep outside audit at the end of the year, but when you are building a home... since the price is usually contracted... any extra expenditure is a loss to your bottom line.
I am sure the department heads would be very frugal if they got to keep the money like we do when building homes.

They act like a non-profit... so using a profit-driven model as a comparison isn't really accurate.

I'm just saying at the end of the year, they could order say $25000, worth of lumber for a project to help make the budget higher for next year.

[John Mercier]

It would show in inventory. And in a for-profit, having that level of inventory would need to exist for a good reason or cut into profits through a carry charge.

Even with what I do... mostly windows and doors pre-paid for, or at least a 50% deposit... if it sits here for more than a week (as it shows in our system)... I get an immediate email wondering what I am doing about it.

If I pre-buy stock inventory... it shows on my inventory. And the system shows how many days that I am ahead on inventory. That triggers an email.

Even purchasing from a distributor that is not our primary supplier triggers an email. I do that usually to avoid shipping costs on a single item or two that I can attach to a larger order that will ship free.

It isn't like years ago when everything was a piece of paper that could be simply filed away never to be seen again.

Our new system is even tighter... I get the email the next day.

For department heads... any question that goes unanswered can result in the loss of a job.

The BPD couldn't thoroughly explain why it needed more money, and their contract was not passed at town meeting. The Budget Committee couldn't fully express why they needed more money... and so that budget didn't pass.

With Board Meetings being taped, and the internet, there is a lot more control over the towns that have slowly modernized.

SB2 also got rid of the cliques controlling the outcomes.

[AB_Monterey]

Originally Posted by tis

Exactly right. They are not going to announce it. And it might not be wasted, it might be something they will use in the future. But just to spend money to make sure your budget doesn't get lowered the next year isn't the way it should be---but it is.

My wife is a town administrator in NH. I can tell you for a fact, that's not the case. Budgets do not get lowered arbitrarily if, for example, plowing comes in with a surplus. Depts do not go on spending sprees to use up their budget.

[tis]

Originally Posted by AB_Monterey

My wife is a town administrator in NH. I can tell you for a fact, that's not the case. Budgets do not get lowered arbitrarily if, for example, plowing comes in with a surplus. Depts do not go on spending sprees to use up their budget.

Hate to disagree but I know first hand it does happen. And if you think there isn't waste in government you are naive.

[Descant]

I don't think dept. heads spend like crazy in the fourth quarter. But certainly the BOS or Town Council can move money around from one line item to another. Keeping taxes stable, using such tools as the (required) six year capital improvement plan is just good management. An unstable tax rate can impact bond ratings and may make business owners less likely to expand if there is no predictability to their future expenses.

[John Mercier]

We got hit with a little unexpected from the late storm.
Some spring ''repairs'' were already in process.

[AB_Monterey]

Originally Posted by tis

Hate to disagree but I know first hand it does happen. And if you think there isn't waste in government you are naive.

You cannot simply take money from a budget line, such as snow plowing, and use it elsewhere on a whim. It requires approval from the select board. In order to use unassigned fund balances, you need state approval.

[tis]

Originally Posted by AB_Monterey

You cannot simply take money from a budget line, such as snow plowing, and use it elsewhere on a whim. It requires approval from the select board. In order to use unassigned fund balances, you need state approval.

I didn't say they took money and used it elsewhere, I said they bought more supplies for their own department to meet the budget.

[AB_Monterey]

Originally Posted by tis

I didn't say they took money and used it elsewhere, I said they bought more supplies for their own department to meet the budget.

and I never said there wasn't waste in "government". So there's that. Budgets are not arbitrarily cut if not spent the previous year. Line item budget spending isn't that flexible and easily spent elsewhere without going through an approval process. They're not spending snow removal money elsewhere without showing justification and, speaking from personal experience, those aren't just rubberstamped.

[John Mercier]

Government waste is always a topic of debate around here.

Enhancing lifestyle can enhance the tax base... but there is always offsets.
Even investments in industrial/commercial development have not stood up... basically because the players all don't have a full understanding of the issues at hand.