Finance official worries about fallout from funding windfall

WINCHESTER -- Town boards in Winchester have scrambled in recent weeks to incorporate $550,000 of recently identified funds into a revised fiscal 2006 budget, which the Finance Committee will present at the fourth session of spring Town Meeting on Monday.

The money will help the town bolster its stabilization fund, which is used as a cushion against unforeseen needs and helps maintain Winchester's solid credit rating. School funding would be boosted, and several town jobs would be restored.

The money is coming from sources that have been discussed in open meetings, said Town Manager Melvin Kleckner. ''This is not new money. This is not 'found' money," said Kleckner, who assumed his post last December, ''but the town has the discretion to use it now, and many choices have to be made."

However, Finance Committee chairman Roger Berman said the process of reallocating money at the last minute has been frustrating, as well as avoidable. A more serious concern, he said, is giving ammunition to those who rejected December's proposed tax increase because they said the town always can find the money it needs.

He is also concerned about alienating the Winchester Foundation for Educational Excellence, which agreed to raise private donations to pay for teaching positions deemed essential by school officials in March, when no alternative sources of public funds appeared available.

According to foundation trustee Caren Connelly, about $400,000 has been donated to date to The Promise Fund. The goal is to raise $660,000 to pay the salaries for four high school, one middle school, and six elementary school teachers.

''There are no villains in the plot; no one thinks the information was intentionally withheld. But in business, the number-one rule is no surprises," Berman said. ''I've been trying to understand how this happened, and I've concluded that Town Hall is undermanned and the professional staff assumed we knew about things that we, as volunteers with day jobs, didn't know to ask about.

''At the end of the day, we have to be grateful these funds arrived, but we also have to look at conservative, multiyear budgeting for fiscal '07 and fiscal '08," Berman continued. ''If we don't, we'll be sorry because no reasonable person in Winchester will vote for an override after what's happened. Credibility doesn't just need to be restored; it needs to be established."

Kleckner submitted his original budget to the Board of Selectmen and Finance Committee in February. He distributed a revised report to Town Meeting members at the May 9 spring Town Meeting session, in light of $177,700 in additional state aid proposed April 29 by the House of Representatives and $349,069 more than the expected $700,000 from the Northeast Solid Waste Committee.

The town has a waste-disposal contract with the consortium, which has kept a stabilization fund to even out swings in trash fees. The group is releasing money from the fund in preparation for the contract's expiration Sept. 30.

At its May 12 meeting, the Finance Committee took budget recommendations from Kleckner and the Board of Selectmen under advisement before voting to recommend to Town Meeting a balanced fiscal 2006 budget of about $67.5 million, a 6 percent increase from this fiscal year, which ends June 30.

The Finance Committee endorsed the call from Kleckner and the selectmen to allocate an additional $550,000 to the fiscal 2006 budget. That amount comes out of the $177,700 of additional state aid and the $1.04 million expected from the trash consortium.

The committee also voted to allocate about $600,000 from these sources to the town's existing $6.67 million stabilization fund.

The increases for fiscal 2006 include $104,334 to restore a part-time building and zoning inspector, provide for election-related town clerk services, restore Fire Department funding, and restore a Department of Public Works laborer position at the transfer station.

The remainder of the money will go to the schools, funding such things as additional teachers, reduced athletic fees, and supplies.

Even in light of the new funds earmarked for the schools, Connelly said, no donors have asked for a refund from the educational foundation. In fact, donations are still coming in. ''People still want to contribute money to core educational services," Connelly said.

Sam Rippin, finance director for the Winchester public schools, said the teaching positions will remain a top priority and the schools will use some of the newly identified funds to pay for teachers if The Promise Fund does not attain its goal.

Karl Fryzel, chairman of the Board of Selectmen, said the challenge beyond approving a fiscal 2006 budget will be improving communication about the town's current and projected financial state. According to Berman, future discussion will include potential uses for an additional $540,000 that will be released by the trash consortium sometime after the contract expires.

Regardless of the newly available funds, however, Kleckner cautioned, the cost of maintaining programs and services townwide will continue to outweigh revenue. As a result, the fiscal 2007 budget already has a projected shortfall of $1.3 million to $1.5 million. A tax increase may be required in fiscal 2008, he said, especially if reserves are used in fiscal 2006 and 2007.

Cynthia Cantrell can be reached at cantrell@globe.com.