Board of Finance November Newsletter

Mill Rate & Budget Guidance. During the November 14 Board of Finance (“BOF”) meeting, the Board met and unanimously decided to set mill rate guidance at 4.0%. This guidance is meant to inform the Board of Education (“BOE”) and Board of Selectmen (“BOS”) budget development. 

As part of its discussion, the BOF reviewed a presentation which can be viewed here. This presentation was created with a mill rate model designed to show what the mill rate would be depending on different BOE and BOS budgets. The model included the following major assumptions, based on input from the BOS and BOE:

• 5.9% / $5.3m increase to the BOE budget (unchanged from the last discussion)
• 3.7% / $1.3m increase to the BOS budget (0.2% / $70k decrease from the last discussion)
• $300k in capital expenditures for school and town maintenance (new assumption)
• $460k increase in debt service ($282k decrease from the last discussion)
• No FY2024 budget savings available to reduce taxes.  $1.6 million of budget savings was used to reduce the current year’s property taxes.  FY2024-FY2025 budget savings will instead remain in the fund balance allowing the town to increase our Moody’s defined ratio of liquid fund balances to revenues from the current 23.5% to at least 25%, which is now required for Aaa bond rated municipalities. (unchanged)

With these assumptions, the mill rate increase was forecast to be 5.4%.

In addition to the above assumptions, the Board also discussed the following in its deliberations:

• Contractual level of union wage increases for both BOE employees (~4.0%) and BOS employees (~3.7%)
• Inflation (currently 3.2%)
• Forecasted changes to school enrollment (decline of 31 children from the current school year) and per-pupil-expenditure trends
• Student / teacher ratio across grade levels and disciplines
• Grand List development (15 projects through FY27)
• Consideration for what may or may not be acceptable to the residents of the town based on previous town surveys, annual town meeting votes, and municipal elections

The Board unanimously decided that while the 5.4% increase would not be a mill rate increase acceptable to the residents of the town, there would still need to be an increase to cover unavoidable expense increases. The Board ultimately decided that a guidance of 4.0% mill rate increase balanced both the needs of the town (an increase at or above contractual wage increases) and the desires of Wilton’s taxpayers. 

Residents should note that given that the revaluation is still ongoing, this guidance did not take any changes to the existing grand list into account.

School Buildings 10-year Needs Assessment Report and Funding. The BOF was invited to meet with the BOS and the BOE for a comprehensive review of the needs assessment on November 27.  The meeting delved into the specifics of the infrastructure recommendations, the proposed timeline, and funding considerations. You can find the presentations (and a Q&A list from the BOF) listed here.

Based on the presentation, the estimated cost to the town is $105.4m, net of $26.7m of state reimbursement grants. While the consultant categorized the work in 3 prioritized buckets to be completed over 10 years, this work could potentially be spread out over 15 years or longer.

First Selectwoman Vanderslice discussed two major funding strategies to finance these improvements: debt financing (in combination with routine infrastructure spending in the BOE and BOS operating budgets) and the creation of a new budgetary line item that can be funded via town development and other mechanisms. Wilton has ample debt capacity over the next several years, as well as a strong pipeline for development which enables flexibility in funding.

The BOF will discuss this topic at the next board meeting on December 12, and will explore the different funding mechanics over the course of the next few months. In conjunction with the BOS and BOE, we will also consider creating a tri-board committee to oversee the different aspects of this spending.

Welcome & Gratitude. Congratulations to Tim Birch, Rudy Escalante, and Prasad Iyer on their election to the BOF. They will all be excellent additions to the Board and we look forward to serving with them.

Thank you to Michael Kaelin, Chris Stroup, and Rich Santosky for their service on the Board of Finance. We are also grateful to Lynne Vanderslice (a former BOF member before her election as First Selectwoman) for her leadership. The town is a far better place because of their service.

If you have any questions or comments, please don’t hesitate to reach out to the Board of Finance at boardoffinance@wiltonct.org.

Matt Raimondi

Clerk

Board of Finance