MERIDEN — The City Council in the coming weeks will need to decide what to do with a projected $1 million surplus left over from Fiscal Year 2018-19.
One option that councilors will consider is using the money on various approved capital projects -- such as library renovations, new hangars at Meriden Markham Airport, and a new banquet facility at Hunter Golf Course. Finance Director Michael Lupkas said other possible uses include applying the funds toward next fiscal year’s 2020-2021 budget, effectively lowering the burden on taxpayers, or allowing the money to roll into the city’s “rainy day fund,” which is currently funded at levels below standards set by the city’s own financial policies.
Lupkas on Tuesday presented details about the surplus to the council’s Finance Committee on Tuesday.
Lupkas told councilors that when the city completes its annual audit later this year, it expects to finish with a total surplus of $1.6 million. That figure includes $632,000 in unanticipated revenue the city received as a result of the past misevaluation of Eversource Energy’s personal property. The City Council voted earlier this year to set aside that $632,000 and use it to replenish the city’s rainy day fund, which is currently funded below levels recommended by the city’s adopted financial policies. Lupkas said that leaves about $1 million of the surplus money for the council to spend on certain expenses if it chooses. If the council decides to not spend the money on anything, the money would get rolled into the city’s rainy day fund.
Lupkas told councilors he wouldn’t recommend they use the one-time funds on recurring expenses such as salaries or maintenance items. In his presentation to the Finance Committee, Lupkas included a list of possible uses for the money that department heads have suggested recently. The library, airport hangar, and banquet facility projects were included on that list, along with a “cell block conversion” project suggested by police (estimated to cost $450,000) and a “downtown district playground, basketball court and/or skatepark (no cost listed).
The list also included items the city removed from its budget or capital improvement plan in the latest budget process, including a city-wide computer replacement (estimated to cost $90,000), a virtual/physical desktop deployment ($220,000), a fire department storage structure ($200,000), a complete repaving of Centennial/Oregon Ave. ($200,000), and police administration vehicles ($150,000). The Parks and Recreation Department also requested the following wishlist items: a pickup truck and plow ($50,000), a splash pad at Hubbard Park ($75,000), a sidewalk plow ($35,000), and a “3-point hitch aerator” ($20,000).
Councilors on Tuesday did not discuss how to use the surplus money. City Manager Tim Coon expects the subject will be raised in the coming weeks. Lupkas told councilors it’s “preferable” that they make a decision by the end of September because otherwise the money will get rolled into the city’s rainy day fund. If the council then chooses to take the money back out and spend it next year, it would show up as a deficit on the city’s fund balance sheet because the city’s fund balance would have dropped year-over-year.