Dear Editor:
A basic financial principle is that you can’t spend more than you earn in business, government or personally. It’s unsustainable.
But in an effort to keep taxes artificially low, the town for more than a decade has maintained a structural deficit, spending more than it earned to cover its daily operating expenses and using utility surpluses, reserves and leveraging debt instead of collecting enough revenue to cover those expenses.
The result of those long term budget decisions by elected representatives has created a perpetual cycle of higher deficits, debt and interest costs.
Increased debt directly results in higher interest payments, which takes up a larger portion of the budget leaving less funds for services and infrastructure projects.
The federal government spending cuts, tariffs and inflation and an estimated $700,000 less revenue from the 1515 PILOT agreement made this year’s budget even more challenging and likely added more than 1% to the tax increase.
Given the challenges, the CFO and the Business Administrator delivered a fiscally responsible budget that addresses
- Immediate critical issues
- aligns with long-term objectives
- sets a path for financial stability
Beginning to address the structural deficit now helps ensure going forward tax rates will remain more stable. Continuing another year of ignoring the deficit will only lead to much higher costs for residents later.
Janice McCarthy
