Council begins long budget process

By Gloria Austin
Staff Writer
 HOULTON, Maine — On Monday in the town chambers, the town manager, council members, department heads and concerned citizens met for an hour and a half in the first of several meetings to go over preliminary numbers in hopes of chiseling out a 2014 budget.
At the end of the meeting, Town Manager Eugene Conlogue was instructed by council at the next budget session to not raise taxes — the taxpayers cannot take the burden of another 1.75 mill increase —  the town needs to find the balance of affordability to property owners and town-provided services.    “Last option on the table when it comes to our budget is eliminating, laying off or furloughing any employees of this town,” said Cleary. “We need to find other places to cut or find revenue instead of balancing the budget on the backs of our employees.”
Though asking does not guarantee any personnel cuts, the councilors are trying to do the best for the townspeople.
“As we have stated and the town will hear this over the next few months, the upcoming budget cycle is going to be a really difficult one,” said Cleary, referring to decisions that may not be popular out of budget talks, but necessary for the town to operate.
Councilor Phil Cloney did an exercise taking a couple of departments and he said, “By the time you take personnel wages and the cost to run building or equipment, there is not much left per department.” Thus Cloney surmised those departments will have to cut manpower.
“The town’s budget has been cut and cut again to the point where the next cuts are positions,” said Cleary, who suggested instead of having the same discussions each year, the council needed to stop talking and take action to move the town forward.
“Let’s start doing some action,” he said. “The taxpayers are looking at us to do action. Our direction to town manager and the department heads is it is now time for action. Talking is over. Let’s move forward and get things done.”
Conlogue had previously directed the department heads to build a municipal budget based on four proposals — a 3 percent and a 0 percent increase, along with a 5 percent and 10 percent decrease — but Conlogue cautioned one of these would not be the official budget presented in November.
The four scenarios presented to the council was designed to show what budgeting would look like if the town needed to adopt one of those proposals, as well as the impact each one would have to the town budget and services provided.
“There is a lot of refinement that will go into this in the next month,” Conlogue added. “Once we have direction to where we want me to go, we will have a clearer path to start making those adjustments.”
Cleary asked Conlogue what the town was looking at for projected revenue next year and secondly, what are the projected expenses and what is the gap?
“We don’t know what those revenues will be for sure,” said Conlogue. “And, we don’t know the expenses until we actually start preparing a real budget document. That being said, on just a few adjustments that we made, we didn’t change too many revenues. The biggest revenue changed was the anticipated revenue sharing loss, which is another sizeable cut to us.”
Several ideas were suggested on how to raise more revenue for the town including, tree harvesting, alternative energy to better use of TIF accounts. Conlogue worked on the assumption of a no wage increase next year and the fact that there would be an increase health insurance costs.
“We are trying to work out a budget to try and accommodate those costs into a budget without requiring a tax increase to support it and that is the challenge,” he explained. “We do not have a strong fund balance, therefore you are limited in your ability to go into that to help support the budget.”
Another unknown factor is the school budget, as well. It appears the state will pass on the cost of teacher retirement and another increase in the required local share.
To help make up revenue, Conlogue suggested that the town council look at a one-time revenue of $35,000 [based on a voluntary forester survey of the lot] with a light harvest on two of the three town-owned woodlots located at the airport, McSheffrey Road and Monticello.
“The two we would be targeting would be the airport and in Monticello,” said Conlogue. The McSheffrey Road lot had been cut a few years ago and it doesn’t appear it has grown back enough to be productive.
“The municipal side of the budget isn’t going to increase a lot, except to try and account for the revenue sharing loss, which would partially be offset by the wood harvesting if we do that, and we will have to shift around some other cost in the budget to try and make this work.”
Another suggestion was negotiating union contracts.
“We are getting to a situation or we are almost in where we would have to lay off personnel,” said Cleary. “We don’t want that.”
Another gap to bridge is the expenditure of fuel consumption for town buildings, with the Millar Civic Center being the top consumer. The town uses almost 50,000 gallons of fuel per year, which is $179,000 that is equivalent to almost one mill.
“We are looking for additional sources of alternative energy presentations to be made to the council,” said Conlogue.
Councilor Daniel Peabody wanted to know how to implement an alternative energy source to save money instead of just discussing it.
Conlogue said the council should not be hasty in its decision, as projections and calculations may not prove to be true figures. Instead, he suggested choose two sources and install them in two different buildings to see which one works the most effectively and shows a cost savings. That would be the recommended source.
“I don’t want to start with the civic center and make a wrong choice,” said Conlogue. “I think we need to be patient and work on this. Also, council approved the temperature control system, which should show savings in heat and electricity. If we hold off, we get to see how it works.”
Not wanting to raise taxes again, Cleary asked if there were any other ways to generate revenue to help offset expenses. He suggested the town manager should look into the TIF accounts to see what the town can and cannot do with the $800,000-plus sitting in the account.
“If we don’t use that in a certain amount of time, the state gets it,” said Cleary. “I don’t want the state to have it. I want the town of Houlton to have it.”
“We need to do a thorough analysis of each of those TIF accounts to see what is allowable for use of each account,” added Conlogue. “Some may be possible to amend, with the state’s permission.”