MILLINOCKET – Millinocket’s finances are very healthy, according to the town’s auditor, who nevertheless warned officials to prepare for cuts in state revenues as lawmakers grapple with the state budget.
Despite the town’s healthy financial position, Roger Lebreux, an auditor and partner at the accounting firm Runyon, Kersteen and Ouellette, told members of the Town Council last week to get ready for cuts in state revenues. “Be ready for that especially on the school side,” he said referring to education subsidy.
Lebreux said the town’s undesignated balance or surplus for fiscal 2002 (ending June 30) grew by about $102,000, from $2.39 million last year to $2.5 million this year. He said the fund balance grew as the result of conservative estimates of revenues and reduced spending efforts.
“You are much better off today than you were back in 1998,” said the auditor, pointing to the fact the town’s surplus had dropped then to a dangerously low level, about $305,000. He commended officials for rebuilding the surplus account.
Lebreux said every town was different when it came to deciding an appropriate amount of surplus. “The property tax base for Millinocket is made up very differently than other municipalities,” he said. “Fifty percent of your tax base is one taxpayer. When you have to rely that heavily on one payer, I say your fund balance should be as high as you can get it.”
He said the town’s surplus represented about 20 percent of the total budget. “That is excellent, but don’t think that is a lot and that you are all set,” he said. “Get it as high as you can get it when you rely that heavily on one taxpayer.”
Councilor Gail Fanjoy said the town’s $2.5 million surplus actually would grow after $405,618 in reserve account balances, which are no longer needed, is lapsed to surplus at the end of this fiscal year. She said it was important that the council and residents understand that while officials used more than $389,000 from surplus to lower this year’s tax rate, the town would still be replenishing its surplus by adding about $103,000 to it after the reserve balances are transferred later this year.
In addition to the $2.5 million surplus, Fanjoy said, the town also has other funds in designated reserve accounts, which include $802,379 in special revenue funds, $448,316 in capital project accounts and about $2 million in wastewater reserve accounts.
In other business, the council approved spending $2,000 to join a new coalition of communities, who oppose some lawmakers’ proposal to eliminate personal property taxes.
Town Manager Gene Conlogue said 59 percent of Millinocket’s tax revenue came from personal property taxes. He said about $234 million of the $397 million in total town value was for personal property.