Published November 05. 2013 4:00AM
New London - Last year at this time, the city had overspent budgets in nearly every department, had overestimated its tax collection rate by more than $1 million and had to take $3.7 million from its savings to balance the budget.
Oh, what a difference a year makes.
A preliminary report on the 2012-13 budget, which ended June 30, shows the city has about $220,000 in surplus. While revenues were $553,000 less than expected, the city underspent its $81 million budget by about $774,000.
Finance Director Jeffrey Smith, who presented the unaudited numbers to the City Council Finance Committee Monday night, received little comment from committee members.
"This is a pretty significant turnaround," Smith said. "The council should take some bows with this."
City Councilor Donald Macrino, chairman of the finance committee, said he would celebrate when the final audit is complete. Smith said he does not expect the numbers to change significantly when the final audited numbers come in.
"I think the conservative approach is better," Macrino said following the meeting. "When all the dust settles ... I think the major achievement of this council will be we stopped the hemorrhaging in the city. I think we've done that."
The budget, which covered July 1, 2012 to June 30, 2013, is also the subject of a referendum today. Voters will be asked to approve the budget, even though the year ended nearly five months ago. Smith said today's budget vote will have no bearing on the budget since the taxes have already been collected and the money already spent.
In the 2012-13 budget, there was $490,000 surplus in the $39.8 million education budget, and more than $300,000 surplus in the $41 million general government budget.
Over expenditures included $200,000 in the fire department, about $200,000 in employee benefits, and $677,000 in former employee and retiree insurance.
Smith said each year the fire department is underfunded and runs a deficit. In 2011-12, the fire department overspent its budget by more than $550,000.
The other overages were mostly due to the large number of employees who retired, were laid off or left the city, he said.
Most of the loss in anticipated revenue - about $450,000 - came in reduction in state and federal grants. The city had estimated it would received about $33.8 million from state and federal grants. The actual number was closer to $33.3 million.
The city's savings account, also called a fund balance, is now just under $1.5 million.
Also on Monday, the City Council approved a $15,000 expenditure to Thames Valley Council for Community Action for its Meals on Wheels program, which was hit by sequestration cuts. TVCCA officials appealed to the council two weeks ago, saying it had to lay off employees and deliver frozen meals once a week rather than every few days because of about $20,000 cuts in federal funding.
The council also approved spending $52,349 for a new animal control vehicle, to replace an old one that has been out of service for several weeks. The money came from a $1 million bond package that the council approved last year to replace vehicles in the Public Works Department.