As I write this, we're waiting for the mayor to stop fretting over whether or not he'll veto the Council's decision to fund the reconstruction of Community Pool. But his deep concern over money is curiously selective. While he frets over the cost of the pool, he may not have paid that much attention to Wallingford's Capital and Non-Recurring Fund (CNR). It had a balance last year of $6.82 million. Monies in the CNR are dedicated to the repair and replacement of roads, buildings, bridges and other capital items — like Community Pool. Is there unused, extra money in the CNR to help pay for the pool and reduce borrowing costs? You betcha!
For some context, let's review why so much cash has been stored in the CNR. The money trail begins when customers of the Electric Division pay their utility bills. Then, by reason of a town ordinance adopted long ago, the Electric Division transfers a small slice of that cash to the CNR. In fiscal year 2020-2021, the Electric Division will send over about $1,842,000. The mayor determines how he'd like to have that money divided among capital projects, and he puts that spending plan into his proposed budget. The Council reviews the mayor's proposal, and by passing the budget, authorizes the capital-spending plan.
Year after year, though, a large residue of money has accumulated in the CNR. Historically, therefore, money has been appropriated faster than it has been used. That has caused a build-up. The case of Wallace Ave. illustrates how this happens. In 2009, the Council authorized $75,000 for the construction of Wallace Ave. That's the little street that takes you into the town parking lot on the Wooding-Caplan site. The street is done, but $40,275 of the original appropriation has been unspent for 11 years. The town has decided, year after year, this money can't be used for anything else except for more work on that project, even though something else may be more urgent and shovel ready — like Community Pool. So that residue is still in the CNR assigned to Wallace Ave. while more is added.
In 2011, the council authorized $150,000 for a project called South Turnpike Road Culvert. But after 9 years, the town still has almost $80,000 left over in the CNR, with no prospect of using that balance in the near future. In 2015, money was appropriated for town wide paving, and $496,402 of that appropriation is still unspent. Despite that, still more money for paving was appropriated in later years, and even those newer appropriations for paving have not been completely exhausted. But with every year that passes, the same choice is made — keep appropriated money in the bank and appropriate more.
In addition to these sums, the CNR has another $1 million unspent and available from prior budgets through fiscal year 2019; it may not use all of the funds appropriated for spending in this fiscal year; and on 7/1/20, the CNR gets refreshed for next year with an additional $1,830,747. Will history repeat?
The mayor can stop this stockpiling of cash. He can do that, first, by funding only projects that can be shovel-ready during the fiscal year. He needs to stop thinking of the CNR as a long-term savings account. We have enough of those. This, however, involves more planning and a seismic shift in the culture at Town Hall.
Next, the mayor needs to lead the involved departments by instructing them that they must do whatever is appropriate and necessary to be ready to use the funds when they arrive in July pursuant to the new budget. If the department cannot be ready to get the project started, the mayor has made the wrong choice in his budget. If, due to circumstances beyond anyone's control, the anticipated capital project will not get started in the same fiscal year, the mayor with the Council's assent, has to make the case-by-case choice as to whether to redirect the money to a more pressing and shovel-ready need, or hold the money temporarily instead of indefinitely.
If the CNR fund balance grows, the mayor has made the wrong choices. If he chooses to redirect the funds to another use that is ready and more pressing, the original project is not lost. To refund it, the mayor need only insert it in the next capital budget, and all will be well.
Finally, the administration and the council need to monitor the expenditures of capital appropriations. If a logjam of money becomes apparent, public officials need not be patient. Good management involves setting timelines and insisting on good results. There's no excuse in the world why the town should still be holding on to $40,275 assigned to Wallace Ave. as a result of a 2009 appropriation, together with other old appropriations, while the mayor frets over Community Pool.
Mike Brodinsky is a former Wallingford town councilor and host of “Citizen Mike” on WPAA-TV.