Accounting firm reports on Newport audit, makes three recommendations

Newport Town manager Jim Ricker
Newport Town manager Jim Ricker Buy Photo
Posted Feb. 20, 2014, at 7:52 a.m.
Last modified Feb. 20, 2014, at 4:46 p.m.

NEWPORT, Maine — Auditors completed their review of the town’s books and reported no problems with the town’s management of almost $5.2 million, the select board learned at its meeting Wednesday night.

Revenues increased by $170,000 in 2013 due to higher excise taxes, state highway grants and solid waste fees while expenditures were $112,000 less than budgeted. Casey Leonard and Ryan Cormier of the accounting firm of Runyon Kersteen Ouellette in South Portland told the three select board members in attendance that these numbers were almost identical to their 2012 audit. This was the firm’s second year of auditing the town of Newport. Their audit process began in December 2013 and was completed in late January 2014.

There were three recommendations the accounting firm presented at the meeting. The first was to change the fiscal year from the current calendar year to a fiscal year which would end on June 30. According to the accountants, this would synchronize the state, education and town budget cycles. Currently the town makes a budget in March and literally guesses what they believe their share of RSU 19’s budget will be.

Town Manager Jim Ricker warned that changing the fiscal year “won’t cure all woes,” but it is a decision that the select board would make, not Newport residents. Despite Ricker’s statement, Select Board Chair Tom Breitweg said he liked the idea and will ask for feedback from residents at Newport’s annual town meeting on March 8.

If the fiscal year is changed to a July to June fiscal year, the annual town meeting would be in June. And to get onto the new cycle an 18-month budget would have to be created and then passed by voters. Property owners would also receive three tax bills during this interim period although the total amount owed would not change. Select board members agreed that this point would have to be carefully and repeatedly explained to reduce confusion and opposition.

Changing the fiscal year would also satisfy the second recommendation of the accounting firm, which is not to operate for three months, or one-quarter of a year, without a budget. This occurs annually because the ‘old’ budget expires Dec. 31 while a new budget is not voted on until March. Ricker called this gap voodoo economics; the auditors called it a dangerous place to be.

The third recommendation was to change the tax collection dates. Right now all property taxes, the town’s biggest source of revenue, are due in November. The auditors believe a second date should be added to smooth out the revenue flow into the town.

The town’s recreation committee’s news and activities took up a good part of the board’s time. With the recreation director’s resignation effective April 1, 2014, the select board discussed whether the position should be filled with a part- or full-time position. No decision was made but Ricker asked the board to consider how the Armory and its equipment would be maintained with a part-timer. Although the town leases the building from Bulldog Enterprises for $1 a year, the town is responsible for its maintenance.

The Armory’s roof is the biggest problem right now. According to Ricker, there are 15 layers of rubber and asphalt dating back to 1951 on it that have to be removed before a new rubber roof can be applied. The rec committee is very active now and asked that their by-laws be changed to increase the committee from seven to 13 members. They also requested that non-residents be able to be committee members. The select board unanimously agreed to both requests. The board also noted that this was the beginning of the high school basketball finals and every year at the tournament there are two or three players who played on the Newport Rec Committee basketball teams.

The final big agenda item was the update on the 2014 Town Report. Ricker reported that the final proof was approved and 500 books are expected to arrive at the town office in about one week. Because 2014 is Newport’s bicentennial, there is an insert in every book with a calendar of events and registration forms for the beauty pageant and other activities.

Ricker reported that the Bicentennial Committee is making real progress now. Twelve organizations have pledged floats and a local car club has confirmed their participation for the parade on July 5 while the carnival company confirmed they’ll be at the elementary school. All this costs money, and the board members were asked to sell raffle tickets to support the festivities. A motor scooter, 100 gallons of heating oil and a kayak will be raffled off at the closing ceremony. Tickets are also for sale at the town office on Water Street.

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