Norwich closes the books on 2021-22 fiscal year with $1.2 million surplus
Aug. 18—NORWICH — While the city finished the 2021-22 fiscal year with higher than expected revenues, lower expenses in most departments and a healthy $1.2 million surplus, the picture in the central city paid fire district is less rosy.
City Comptroller Josh Pothier on Monday provided a two-page memo explaining end-of-budget-year final transfers along with revenues and expenditures for the fiscal year that ended June 30.
The city ended the year with general fund revenues $500,000 higher than budgeted and with general fund expenditures some $700,000 less than budgeted, Pothier wrote in the memo. In addition, the Norwich Public School budget is expected to end in a surplus. School officials will request that at least part of the anticipated surplus be placed into the nonlapsing account the City Council created a year ago for school emergency costs.
But the CCD, or City Consolidated District, the urban district that pays personnel costs for the paid city fire department, ended 2021-22 with a $74,000 deficit, due to increased overtime and other replacement costs for firefighters on vacations or absences. Pothier wrote that major factors were "on-duty and off-duty injuries causing thousands of hours of replacement cost."
The City Council has scheduled a public hearing for its Sept. 6 meeting on an ordinance to cover the CCD cost overrun using the CCD general surplus fund. The fund balance is only $137,000, Pothier wrote, or 1.7% of annual expenses. He said while the city has no policy on how much money should be kept in reserve, he would recommend a balance of 8% of expenditures as "an adequate level for a fund with moderate levels of risk, like the CCD."
The council approved using $13,000 in the contingency budget to cover an $11,000 cost overrun in Public Works Department for utilities and fuel costs, and $2,000 for building repairs at the Laurel Hill Volunteer Fire Department.
The citywide general fund surplus ended the year with about $18.2 million, 13.45% of annual expenditures, within the city's target range of 12 to 17%.
City Manager John Salomone said city expenses were down in part, because city spending has not fully recovered from pandemic drops. "There are still things we cannot do," Salomone said.
He said he is not overly concerned about the low surplus level in the CCD, because the fund covers only fire department personnel costs, which typically would not incur major emergency expenses. Major capital costs are covered in the city's general budget.