Oak Bluffs selectmen learned Tuesday that their town now expects to fall $336,607 short of its revenue projections at the end of the current fiscal year, on June 30, this year.
In their first meeting of the New Year, facing head-on a municipal byproduct of the national economic downturn, the selectmen got the sobering report from Paul Manzi, Oak Bluffs finance director and treasurer. Selectmen Ron D’Orio, chairman of the board, had asked Mr. Manzi to deliver the news.
Having passed the halfway mark in the 2009 fiscal year, Mr. D’Orio said he asked Mr. Manzi to provide the numbers because he thought it wise to be proactive.
“I do not want to be here in May with too short a time to make up $336,000,” Mr. D’Orio said. He said the town would need to look at the numbers now and make appropriate adjustments in the budget to deal with the shortfall.
One possibility may be savings from the budgets of town departments, including the highway and tax collector departments, which have not filled several vacant positions.
During the short discussion that followed Mr. Manzi’s report, selectman Roger Wey, who is also Council on Aging director, suggested across-the-board department cuts. He said the most important consideration was to keep employees.
Selectman Kerry Scott said there are some department budgets that cannot be cut. She offered the town clerk’s department as an example.
The selectmen agreed that in concert with the finance committee, they would begin the search for savings or revenue increases when they meet next.
After the meeting, Mr. Manzi told The Martha’s Vineyard Times one option to generate revenue might be an auction sale of town-owned properties or foreclosed properties.
Local receipts lag
About this time last year, town leaders and department heads began the annual process of putting together the town operating budget they would present to voters at the spring annual town meeting.
Referring to the revenue projections made at the time, Michael Dutton, town administrator, told selectmen Tuesday night, “Those were conservative estimates, but they were not conservative enough.”
Despite signs of a slowdown in the economy, no one anticipated the financial meltdown that would occur in the fall. Mr. Manzi’s estimate is based on expected shortfalls in three of the town’s primary local sources of revenue.
He said motor vehicle excise taxes are expected to fall $93,050 short of a budgeted $674,827. The reason, he said, is that people are not buying cars.
Revenue from licenses and permits is expected to fall $157,782 short of a budgeted $409,418, due to a decline in building activity.
And it is estimated the $155,537 the town expected to receive in investment income will be off by $85,775, due to a drop in interest rates.
The estimated $336,607 shortfall does not reflect cuts in state aid. Mr. Manzi does not anticipate a major hit in FY 09, but in FY 10, the town will likely see cuts, he said.
To be on the conservative side, next year’s budget will be built around an expected 10-percent cut in state aid, or approximately $170,000, Mr. Manzi explained.
Selectmen moved briskly through an agenda that included several appointments and a public hearing designed to qualify the town for significant federal money that would allow a qualified homeowner to seek a zero-percent, deferred-payment, forgivable loan to rehabilitate his or her house.
Selectmen reappointed Robert Huss to the Steamship Authority port council and named M. Casey Sharpe, a lawyer and former town administrator, to the Martha’s Vineyard Commission.
Selectmen approved a one-day beer and wine permit for a potluck inaugural event at the Dreamland building, sponsored by the Oak Bluffs Association, and they approved the dates for four popular road races: Memorial Day race, May 24; NAACP race, Sept. 12; Columbus Day race, Oct. 11; and Thanksgiving Day race, Nov. 26.