Preston - The Board of Finance Monday approved town government and school budgets, debt service and capital expense budgets totaling $15.45 million and proposed using $660,000 from the town surplus fund to keep taxes at the current 23.24 mills.

The finance board made minor adjustments to the general government budget submitted by the Board of Selectmen, approving a $3.47 million budget with a 4 percent or $140,765 spending increase. The board made no changes to the proposed $10.85 million school budget, which has no increase compared to the current budget.

The finance board added $120,000 to the town budget to cover the potential town matching share for three $200,000 federal environmental cleanup grants for the former Norwich Hospital property.

The two major budgets, along with a $780,114 debt service budget and $344,530 for miscellaneous expenses, will be presented to residents at two public hearings. The first hearing will be at noon Saturday, April 18 at Town Hall and the second will be held Thursday, April 23 at 7:30 p.m. at the Preston Veterans Memorial School. The annual town meeting on the budget is scheduled for May 7.

Preston's financial picture remains strong, with the current town surplus at $2.8 million, 18 percent of the town's annual operating budget -- not including a new $140,000 check received from the town's insurance company to cover expenses from an oil spill several years ago at the Preston Veterans Memorial School.

Even after using $660,000 from the surplus fund to offset any need for a tax increase next year, the surplus still would be $2.14 million, 13.86 percent of the annual operating budget. The Board of Finance's policy is to retain an untouched amount totaling at least 9.5 percent of the town's annual budget in the surplus fund.

Board of Finance Chairman Norman Gauthier praised both the town and school officials for their frugal budgeting. At the end of the 2013-14 budget year, the town returned $376,700 in unused funds to the town, while the Board of Education returned $57,652 in unspent funds to the town.

c.bessette@theday.com

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