Town will fall short of revenue for 2019
Published 7:24 pm Tuesday, April 24, 2018
Can use surplus or increase taxes
By Elizabeth Pattman
Smithfield’s proposed fiscal 2019 budget is nearly $170,000 short and Town Council members are searching for new revenue sources to make up the difference.
Budget discussions began at Monday’s Town Council committee meetings. Town Treasurer Ellen Minga stated there is a $169,103 deficit in the general fund for fiscal year 2019, but suggested several possible revenue sources to compensate for the deficit.
These potential sources of additional revenue include an increase to the real estate tax rate or motor vehicle license taxes, fees for trash pick-up, a further increase in the local meals tax from its current 6.25 percent to 6.5 percent, business license taxes and selling the Phase I Pinewood Heights properties.
Town Council committee members did not discuss the possible tax hikes further.
No decisions were made regarding how the town would balance the budget by the end of Monday’s meeting, but council members plan to set a budget work session at the May 1 Town Council meeting.
The proposed fiscal 2019 operating budget is $12.6 million, up 10 percent from the 2018 adopted budget of $11.5 million.
Public safety comprises the largest amount in the budget, at $2.4 million, followed by parks, recreation and cultural at $2 million.
If expenses are not cut and none of the possible revenue increases are implemented in the final budget, the town will have to use reserves to cover the shortfall, said Town Council member Milton Cook.
“That’s what reserves are for,” said Cook.
The Town Council dipped into its reserves last year, about $83,000, to cover debt service costs associated with the restoration of the Windsor Castle manor house and the Joseph W. Luter Jr. sports complex.
Minga said this early draft of the budget was “very, very challenging,” and that the cost of looming infrastructure projects is one part of that challenge.
Earlier this year, Smithfield Director of Planning, Engineering and Public Works William Saunders told the Town Council that it was looking at more than a million dollars in infrastructure needs, including sewer and water line replacements and town pump station upgrades.