CARIBOU, Maine — A preliminary report on last year’s financial totals points to a $34,000 surplus for Caribou, city councilors learned when they met Jan. 28.
City Manager Dennis Marker described the report in further detail during the meeting, and cited that expenses were $10,048,735, or $185,379 less than projected, while revenues were $10,190,844, or $151,205 less than projected, resulting in a difference of $34,174.
Marker emphasized that this is the unaudited report, and that these numbers may change following the city’s audit.
On the expense side, he said ambulance billing, approximately $196,000, was moved back under the fire and ambulance department’s budget line from the general government category. This transfer makes the general government totals appear under budget and the fire department total appear over budget.
Marker clarified that the fire and ambulance department would have been under budget were it not for this transfer, which creates the impression of general government spending far less and the fire and ambulance department spending far more than usual.
Other line items over budget in 2018 were the police department, airport, snowmobile trail maintenance and Section 8.
The city manager said police expenses were $43,254 over budget as a result of a new school resource officer being hired by RSU 39. Those expenses will be offset by the school.
The airport’s increase of $50,364 over budget arose from the city taking over FBO (fixed-base operator) services at the airport as opposed to Fresh Air, LLC, and the expenses incurred as a result of that transition.
Snowmobile trail maintenance, according to Marker, was $14,583 over budget as a result of trail repairs needed due to runoff damage as well as the early winter, requiring trail maintenance in November.
The Section 8 FSS (Family Self-Sufficiency) program was over by $3,248 because the expense budget was set before officials knew about grant money awarded to the city in 2018, which exceeded the budget by over $7,000. Marker added that this program is entirely funded by grant money.
Marker indicated in a memo to the council that the primary factor leading to less revenues than anticipated is the city receiving $185,079 less than projected from Medicaid and Medicare payments.
Mayor Mark Goughan asked if any action needed to be taken, such as a vote to transfer funds from one department to another.
Marker explained that the budget comes out as a wash because of the council’s prior actions.
After further discussion of the report, Goughan asked if the city would take funds from departments that were under budget and place them into departments that went over to “make up the difference,” which Marker said was correct.
Goughan expressed concern that the city’s leftover funds were getting smaller compared to previous years.
“Two years ago, and I’m using round numbers here,” he said, “we had unexpended appropriations of about $390,000 and we had to wait two years to use it for the budget. Last year we had about $250,000, and now we’re down to $34,000. So two years from now, when we go to grab what was normally $390,000, we’re not going to have it. We’re only going to have $34,000.”
The mayor said this “represents a ticking time bomb we need to focus on.”
“To put a positive spin on it,” said Marker, “the budget process is becoming more true with the numbers. There is a better grasp on revenue and expenses so that theoretically would be an indication that we’re coming closer to a truer budget.”
Marker said he agreed that this also means that the city will not have as much to contribute into its “rainy day fund.”
While Goughan said he has no problem with a “lean budget,” he suggested council might need to look at shrinking leftover funds in the future.
