Warren seeks to change fiscal year
Warren — At its May 28 meeting, the Warren Board of Selectmen reviewed the advantages and disadvantages to changing the town's fiscal year.
A special town meeting will be held Tuesday, June 24, at 7 p.m. to discuss the idea.
Currently the town runs on a calendar year, from January to December with taxpayers making a single payment in November.
"For much of the calendar year, the town operations are funded through borrowing via a Tax Anticipation Note [TAN]," explained Town Manager Elaine Clark.
When tax revenues arrive, the TAN is paid off.
However, Clark explained the payment consumes most of the tax proceeds — leaving revenue for only a few months of operations. This makes it necessary for the borrowing to start again.
"Borrowing has increased slowly over the past 10 years, and the current board wishes to correct the situation," said Clark.
The change to a fiscal year running July 1 to June 31 may cause some initial financial difficulties, but would also allow taxpayers to break their burden in two — making payments in May and October.
Town auditor Chris Backman, after briefing on the 2014 draft audit to the board, explained the advantages with the fiscal year change.
"It is a good thing," Backman said, adding "It will require three payments in a 12-month period to start and 18 months of TAN loans and hard work."
"The fiscal year change, in combination with two payments per year, will provide cash flow to the town, and will also be easier on taxpayers who will not be facing a single large property tax bill just before year-end," said Clark.
Another important benefit of the change, Clark noted, is that actual budget figures for Warren's share of the Regional School Unit 40 budget will be known for budget preparation purposes.
"The proposed change is essential to town operations," said Clark, adding "The town should not fund its operations with borrowed money for such a large portion of the year. In my opinion."
She feels changing fiscal years and enacting twice-a-year tax bills is the only responsible course of action for the town. Backman, who works for RHR SMith & Company, concurs with the change.
Courier Publications reporter Beth A. Birmingham can be reached at 594-4401 ext. 125 or via email at firstname.lastname@example.org.