Bedford mulls fiscal year switch
Dionne said the disadvantages of the current system include the town’s reliance on its fund balance to pay bills, delaying some projects until receipt of tax money, and closing one year and preparing a budget for the next year at the same time. Dionne said although the current system has worked, the town collects money in arrears and spends money for three months without budget approval.“
Councilor Bill Dermody, who is among those in favor of moving to a fiscal year, said this option is like, “giving birth to an elephant. Your checkbooks are going to have a hernia during this transition period.”
Option 2 would allow the town to establish a reserve fund in anticipation of transitioning to fiscal year accounting. With this option the town could set aside money a little at a time, but would have to budget this item every year.
“It’s easily explainable. It does mitigate the spike in the tax rate. It does spread the transition out over a number of years and allows us to make the transition immediately,” she said.
Option 4 would set up quarterly tax billing but, Dionne said, quarterly tax bills may confuse taxpayers and bank escrows, and increase operating costs for the town’s software updates and preparing, mailing and collecting bills four times a year. This option needs more analysis, she said.
Councilors asked Dionne and Levine to provide calculations on what impact the move would have on taxpayers based on a $400,000 home, including costs for all four options. Dionne said the Town Council will further discuss the possibility of moving to fiscal year accounting at either its Sept. 11 or Sept. 25 meeting.
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