Meredith passes $22 million budget, reduces local tax rate with amendment

MEREDITH — The budget on the Town Warrant was amended on the floor Wednesday night, using surplus funds to bolster the revenues and reduce the estimated local tax rate.

Article 10 was amended by Meghan Theriault, keeping the operating budget figure as presented at just under $22 million, and taking $1 million from the unassigned fund balance to reduce the tax impact. That approval resulted in the estimated municipal tax rate to be $3.90, instead of $4.16.

This represents a 13.4% increase, rather than the 20.9% estimated if the budget and other articles were all approved as written.

Article 10 asked to raise the sum of $22 million, a 5.5% increase, for general town operations. Before the discussion took place, Selectboard Chair Mike Pelczar made a point of order to discuss a plan to reduce the projected tax rate.

Pelczar said the rate could be reduced to about 13% by redirecting money from the unassigned fund balance to cover projects in Articles 11 through 16, which would have instead come from taxation.

His plan was initially to vote on the proposed budget, and then immediately move to consider Article 17, which asked the town to add $960,000 to the Community Infrastructure Trust Fund. The money came from unexpended appropriations and one-time unexpected revenue through a property sale.

Pelczar told voters he would then make a motion to amend this amount to $6,000, to keep some money for emergency purposes. The remaining $900,000 would go into other expendable trusts through amendments to articles 11 through 16, to decrease the municipal tax rate. There was $1.4, million in total spending through taxation in Articles 11 through 16.

The idea Pelczar brought forward quickly disappeared with a successful amendment to the budget which ultimately had the same result.

The Article 10 discussion began with Vice Chair Steve Aiken making a presentation showing the total budget would be $24.4 million, or a 9.8% increase. The largest increases are from capital costs and personnel items like raises, health insurance and hiring.

Frank Michel, a former selectboard member, was vocal from the start about his disapproval of the budget brought forward, and inquired why they don’t just use $1.4 million of the fund balance, instead of putting it toward expendable trust warrant articles.

Town Manager Judie Milner said the current fund balance is $7.4 million, and removing $960,000 leaves 12% of the operating expenditures. This falls within recommended guidelines from the state Department of Revenue Administration, and while the town wouldn’t be penalized if it were lower, she noted the most recent recession parameters changed, because several municipalities went bankrupt. Milner said the town wouldn’t be considered as bond-worthy as other communities with a lower percentage.

Theriault asked what percentage the town had carried in previous years, and Pelczar said in his 11 years on the board, it had always been around 12%. She noticed last year, about $1.8 million of the fund balance was used, and generally has averaged around $1 million per year.

David Voltz made an amendment to the article to change the general operating budget to $20 million, a 4.7% decrease. While this sounded appealing to some, others were wary of where to find the savings. Milner said there could be several impacts if it were approved, and she would need time to make the best decision for Meredith.

John Dever asked for a sense of from where the money would come.

“Taking a whack at things and just 'saying figure it out' isn’t good, in my opinion,” Dever said.

Voltz said he came up with the number by looking at the 2025 budget, not out of thin air. He was also at the selectboard meeting on March 9, asking about the amendment process. Voltz said something needs to be done to make the town more affordable.

Resident Jonathan James wasn’t in favor of cuts, saying the town needs to survive. He pointed to infrastructure, saying the town looks pretty above the pavement, but the underground needs work, which will cost a lot of money.

“It’s just crazy to cut this budget,” James said.

Resident Jack Carty was in favor of cutting the budget, saying he was not delighted with bringing in additional employees if the town doesn’t need them. He felt the current staff has done a “fine job.”

He then asked to call the question, and the amendment was defeated.

Theriault said she wasn’t in favor of cutting a large portion, and instead proposed an amendment to use $1 million from the unassigned funds directly into the budget, so each subsequent warrant article could be voted on.

“Residents can decide which are worth approving,” she said.

Theriault said her motion didn’t cut the budget, but used the $1 million to be put back into the budget to reduce the tax impact. The amendment and article then passed 137-106.

Some voters were expecting Article 17 to be moved up, as proposed by Pelczar, but with the motion and budget approved, the selectboard decided to carry on in order.

Theriault said while her motion brought the municipal tax rate down, it could be reduced even further depending on the votes on Articles 11 through 16. Each article was passed by voters, with funds coming through taxation.

Articles 11 and 12 asked residents for $75,000 each for the Main Street Rehabilitation and Waterfront Infrastructure trust funds.

The money for Article 11 will go toward engineering costs for the Main Street project, and funds for Article 12 are going toward repairing the Waukewan Canal. These both passed with a card vote.

Approval of Article 13 allowed $182,000 to be added to the Fire Department Equipment trust, for turnout gear at the end of its useful life.

Article 14 was also approved, which adds $535,000 to the Fire Department Vehicle fund, bringing the total to $1.2 million, to be used for a down payment on an Engine 1 replacement. This is 90% of the total estimated cost of $1.3 million.

Article 15 was approved, but not without discussion from residents both for and against. Passage allowed for $200,000 to be added to the Parks and Recreation Improvement trust, intended for engineering studies for the Prescott Park Revitalization Project.

Some residents didn’t feel this should fall on taxpayers, with one saying there are there are well-funded hotels and restaurants in the area who could offer money, with recognition at the park. Resident Bob Manley said it is a small price to pay for what appears to be an incredible asset to the community.

Prescott Park is home to the town athletic fields. Aiken said aspects including the road issue in the area and lighting need to be studied to find out the actual cost. After some nudging from residents, and hesitance to make an estimate, Aiken reluctantly said it could cost between $5 and $10 million.

“We don’t know the actual answers until we get the engineering done,” Aiken said.

Article 16 also passed, which adds $337,000 to the Department of Public Works Equipment trust. This is to finance or purchase an excavator, dresser loader, an F-350 and an F-600 with a plow and sander upfit.

Then came Article 17, which asked the town to add $960,000 to the Community Infrastructure fund. While not earmarked specifically, it was recommended by Milner, and Finance and Administrative Services Director Robert Carpenter, to be used for engineering for a Town Hall/annex project, and to cover a $320,426 shortfall in the Main Street Project.

With the budget amended, Pelczar wanted to make sure people knew what they were voting on. If the article was approved, it would have taken nearly $2 million from the unassigned fund balance, due to the $1 million amended into Article 10.

Pelczar referred to Attorney Timothy Sullivan to address the voters to quell any confusion.

Sullivan said the operating budget was approved as proposed in Article 10, and the amendment adding $1 million would be a source of funding, or revenue. Sullivan said if voters don’t want to pull twice from the fund balance, they should not approve Article 17 as currently drafted.

Michel asked what would happen if the voters approved using the $960,000 toward the budget, as well. He asked if Meredith would be in trouble if the fund balance was lower than 12%. Both Milner and the town attorney advised against a low percentage. Milner said a healthy fund balance is helpful for cash flow, emergencies and for bond rates.

Sullivan said he understands the temptation to think of this as a savings account, but it isn't, and is designed for cash flow.

Resident Lisa Davis asked if Article 17 were passed, what the percentage would be, and Milner said it would be at 8.8%.

Theriault agreed with Pelczar and recommended voting down the article, due to the approved amendment, saying the town doesn’t need to “double dip.”

Resident Brian Harris said, “This has been a strange road that we’re traveling this evening,” and followed with an amendment to the article to “decomplexify everything and get us finished.”

He proposed an amendment to cut the number to $75,000, which consistent with Articles 11 and 12, as placeholders for future projects the town has, coming but doesn’t have specifics.

“I think it is a good warrant article, we can afford it, and wrap up this section of the meeting,” Harris said.

Harris’s amendment failed to pass.

After about three hours of deliberating Articles 10 through 17, a secret ballot vote for Article 17 resulted in 207 “no” votes, and only 20 votes in favor.

Look for further Meredith Town Meeting coverage in Tuesday's paper.